The World Bank
Caribbean Ocean and Aquaculture Sustainability FaciliTy (COAST) Project (P171321)
Appraisal Environmental and Social Review Summary
Appraisal Stage
(ESRS Appraisal Stage)
Public Disclosure
Date Prepared/Updated: 03/24/2020 | Report No: ESRSA00435
May 26, 2020 Page 1 of 8
The World Bank
Caribbean Ocean and Aquaculture Sustainability FaciliTy (COAST) Project (P171321)
BASIC INFORMATION
A. Basic Project Data
Country Region Project ID Parent Project ID (if any)
Caribbean LATIN AMERICA AND P171321
CARIBBEAN
Project Name Caribbean Ocean and Aquaculture Sustainability FaciliTy (COAST) Project
Practice Area (Lead) Financing Instrument Estimated Appraisal Date Estimated Board Date
Environment, Natural Investment Project 5/25/2020
Resources & the Blue Financing
Economy
Borrower(s) Implementing Agency(ies)
Caribbean Catastrophe Caribbean Catastrophe Risk
Risk Insurance Facility SPC Insurance Facility
Public Disclosure
Proposed Development Objective(s)
The Project Development Objective is to strengthen financial resilience of Caribbean countries through insuring
against climate-related events that impact the fisheries sector.
Financing (in USD Million) Amount
Total Project Cost 2.40
B. Is the project being prepared in a Situation of Urgent Need of Assistance or Capacity Constraints, as per Bank IPF
Policy, para. 12?
No
C. Summary Description of Proposed Project [including overview of Country, Sectoral & Institutional Contexts and
Relationship to CPF]
The development objective of the project is to strengthen financial resilience of Caribbean countries through insuring
against climate-related events that impact the fisheries sector. This will be achieved by financing the COAST
capitalization and sovereign insurance premium in participating countries (St Lucia and Grenada). COAST is an
innovative climate risk insurance mechanism to promote sustainable fisheries, food security, livelihoods of fisherfolk
and disaster risk reduction in the Caribbean. COAST is designed to support governments’ efforts to rapidly put money
into the hands of fisherfolk impacted by extreme weather, providing them with immediate economic relief.
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The World Bank
Caribbean Ocean and Aquaculture Sustainability FaciliTy (COAST) Project (P171321)
D. Environmental and Social Overview
D.1. Detailed project location(s) and salient physical characteristics relevant to the E&S assessment [geographic,
environmental, social]
The proposed project will be implemented in St Lucia and Grenada. As Caribbean countries, both St Lucia and
Grenada are highly vulnerable to extreme weather events such as tropical cyclones and excessive rainfall, magnified
by climate change. The project does not contemplate any direct physical investments in any specific location and will
benefit the fisheries sector in general through parametric insurance pay-outs. The parametric insurance products are
insurance contracts that make payments based on the intensity of an event (for example, hurricane wind speed or
volume of rainfall) and amount of loss calculated in pre-agreed model caused by these events. This type of insurance
is different from traditional or indemnity insurance settlements that require an on-the-ground assessment of
individual losses after an event before a payment can be made. Pay-outs can be made very quickly after a hazard
event. The project will enable direct support to fisher communities that may be impacted by extreme weather events
and payment will be range from US$100 to US$300 per beneficiary. The insurance funds will not be tied or tracked to
any specific investments.
The proposed project is expected to have positive direct poverty reduction and social impacts by enhancing the ability
of the countries to meet the needs of their fisher communities in the aftermath of major disasters. The project will
encourage inclusiveness and participation of women. It is intended to be inclusive of all participants in the fisheries
sector, including fish vendors and processors who are mostly women. The list of beneficiaries was predefined by the
governments as per the project Operational Manual.
Public Disclosure
D. 2. Borrower’s Institutional Capacity
The project will be implemented by the CCRIF SPC (formerly the Caribbean Catastrophe Risk Insurance
Facility), a segregated portfolio company, owned, operated and registered in the Caribbean. The CCRIF SPC is
operated through a virtual office with very limited numbers of ful time staff. It is the world’s first regional fund
utilizing parametric insurance, giving member governments the unique opportunity to purchase disaster risk
insurance with lowest possible pricing. CCRIF was developed under the technical leadership of the World Bank and
with a grant from the Government of Japan. It was capitalized through contributions to a Multi-Donor Trust Fund
(MDTF). 19 Caribbean governments and 1 Central American government (Nicaragua) are currently CCRIF members.
CCRIF has experience on bank funded project implementation. It has implemented Central America and Caribbean
Catastrophe Risk Insurance Project from mid 2015. CCRIF is also working on the development of a standardized
integrated risk management framework for use by all Caribbean countries which includes economic, geopolitical,
environmental, social and technical risks.
II. SUMMARY OF ENVIRONMENTAL AND SOCIAL (ES) RISKS AND IMPACTS
A. Environmental and Social Risk Classification (ESRC) Low
Environmental Risk Rating Low
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The World Bank
Caribbean Ocean and Aquaculture Sustainability FaciliTy (COAST) Project (P171321)
The environmental risk classification of the project is low under the World Bank Environmental and Social Framework
based on the nature and scale of the project intervention and client capacity. The project will not support any physical
works or procurement of goods. The project will provide parametric insurance support to the fishing communities as
emergency support in extreme bad weather condition and tropical cyclone. Additionally, the project will cover the
payment of participating countries annual insurance premium. The project activities are not expected to have any
adverse impact on human population and the environment.
Social Risk Rating Low
The project social risk rating is considered low. The project does not include any physical works and it is anticipated
that projects will have positive impacts on its intended beneficiaries. The project is essentially a pass through
financing from the CCRIF to local ministries in Grenada and St Lucia for a risk insurance program for fisherfolk
communities in the event of a catastrophic weather event. The current contours of the project do not represent risks
to human populations in both of these countries.
B. Environment and Social Standards (ESSs) that Apply to the Activities Being Considered
B.1. General Assessment
ESS1 Assessment and Management of Environmental and Social Risks and Impacts
Overview of the relevance of the Standard for the Project:
This standard is relevant since this standard sets out the Client’s responsibilities for assessing, managing and
monitoring environmental and social risks and impacts associated with each stage of a project in order to achieve
Public Disclosure
environmental and social outcomes consistent with the Environmental and Social Standards (ESSs).
During the project concept stage, the project screening included review of the Project Concept Note, cross-checking
expected impacts of similar insurance projects in the region or elsewhere, discussions with task team members, and
literature review including fisheries assessments in St Lucia and Grenada. These assessments were carried out to
gather fisheries and disaster risk management information at the country level and incorporate it into the
development of the COAST product. The assessment entailed the collection of data on fisheries assets, management,
and beneficiaries, which fed the COAST fisheries model in each of these countries. The information of the
beneficiaries also provides the social baseline of the project. Consultations were undertaken with fisher communities,
fisher cooperatives, and government to assess their readiness to adopt COAST. The anticipated environmental and
social risks and impacts to the project interventions are likely to be negligible. Therefore, consistent with the
requirements of ESS1, no further environmental and social assessment was deemed necessary after initial project
screening.
ESS10 Stakeholder Engagement and Information Disclosure
This standard is relevant. Stakeholder Engagement Plan (SEP) is one of the key factors for project success. The CCRIF
SPC in coordination with the Ministry of Finance of St Lucia and the Ministry of Finance of Grenada has prepared and
disclosed a SEP that includes the stakeholder engagement activities during implementation and adoption of the
grievance redress mechanism prior to appraisal. SEP has been built on the consultations carried out under the
fisheries assessments in St Lucia and Grenada. CCRIF SPC is primarily responsible for stakeholder engagement and
information disclose as per ESS2. Through these two ministries, CCRIF SPC will provide stakeholders with timely,
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The World Bank
Caribbean Ocean and Aquaculture Sustainability FaciliTy (COAST) Project (P171321)
relevant, understandable and accessible information, and consult with them in a culturally appropriate manner,
which is free of manipulation, interference, coercion, discrimination and intimidation. The strategy for information
disclosure, consultations and feedback of vulnerable groups have been incorporated in the SEP. The CCRIF SPC will
also facilitate meaningful consultations with all stakeholders throughout the project-life cycle, paying attention to the
inclusion of vulnerable and disadvantaged groups (the elderly, persons with disabilities, etc.). A Communication Plan
has been developed and implemented as part of the SEP. The GRM will enable stakeholders to channel concerns,
questions, and complaints from stakeholders and respond to issues related to a broad range of project
implementation issues.
B.2. Specific Risks and Impacts
A brief description of the potential environmental and social risks and impacts relevant to the Project.
ESS2 Labor and Working Conditions
This standard is relevant. According to the proposed project design, the existing staff of the CCRIF SPC, the Ministry of
Finance of St Lucia and the Ministry of Finance of Grenada will be responsible for its implementation. It will not
require any additional staff, consultant or workers for implementation. However, a Labor Management Plan (LMP)
has been prepared as a precautionary measure to set out the way in which project workers (if required during
implementation for additional consultations and other project related activities) will be managed, in accordance with
the requirements of national law and ESS2.
The parametric insurance contracts make payments based on the intensity of an event (for example, hurricane wind
Public Disclosure
speed or volume of rainfall) and amount of loss calculated in pre-agreed model caused by these events. Therefore
extensive field work to assess individual damages on property or other physical structures that is typical for insurance
payout is not a feature of this vehicle given that compensation is dispensed based upon extreme weather events. The
project however will include provisions in the LMP in the event that any fieldwork workers are needed.
In addition, LMP describes mitigation measures used to manage health and safety risks and ensure that the client
does not employ any child labor. It is anticipated that the risks to be low given the nature of the work by the client
which is mostly office work and risks are low of any serious health and safety incidents.
ESS3 Resource Efficiency and Pollution Prevention and Management
The standard is not relevant as the project activities will not be associated with any significant use of resources such
as water or energy.
ESS4 Community Health and Safety
The standard is not relevant as the project activities will not have any adverse environmental and social impacts on
communities.
ESS5 Land Acquisition, Restrictions on Land Use and Involuntary Resettlement
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The World Bank
Caribbean Ocean and Aquaculture Sustainability FaciliTy (COAST) Project (P171321)
This standard is not relevant as there will be no anticipated land acquisition or resettlement.
ESS6 Biodiversity Conservation and Sustainable Management of Living Natural Resources
This standard is not relevant. The project does not have any physical work and will not cause any impact on
biodiversity and living natural resources.
ESS7 Indigenous Peoples/Sub-Saharan African Historically Underserved Traditional Local Communities
This standard is not relevant.
ESS8 Cultural Heritage
The standard is not relevant. The proposed operation does not pose any risk to cultural heritage.
ESS9 Financial Intermediaries
The project will not involve Financial Intermediaries.
B.3 Other Relevant Project Risks
Public Disclosure
No other risk
C. Legal Operational Policies that Apply
OP 7.50 Projects on International Waterways No
OP 7.60 Projects in Disputed Areas No
III. BORROWER’S ENVIRONMENTAL AND SOCIAL COMMITMENT PLAN (ESCP)
DELIVERABLES against MEASURES AND ACTIONs IDENTIFIED TIMELINE
ESS 1 Assessment and Management of Environmental and Social Risks and Impacts
CCRIF SPC shall maintain qualified staff in adequate numbers and experience, in a manner acceptable
05/2020
to the Bank, to support implementation the ESCP.
ESS 10 Stakeholder Engagement and Information Disclosure
Prepare, disclose, adopt and implement a Stakeholder Engagement Plan (SEP), in a manner acceptable
03/2020
to the Bank.
May 26, 2020 Page 6 of 8
The World Bank
Caribbean Ocean and Aquaculture Sustainability FaciliTy (COAST) Project (P171321)
Maintain and operate a grievance mechanism, as described in the SEP. 05/2020
ESS 2 Labor and Working Conditions
Prepare, adopt, and implement the Labor Management Procedures (LMP) that have been developed
03/2020
for the Project, in a manner acceptable to the Bank.
ESS 3 Resource Efficiency and Pollution Prevention and Management
ESS 4 Community Health and Safety
ESS 5 Land Acquisition, Restrictions on Land Use and Involuntary Resettlement
ESS 6 Biodiversity Conservation and Sustainable Management of Living Natural Resources
ESS 7 Indigenous Peoples/Sub-Saharan African Historically Underserved Traditional Local Communities
ESS 8 Cultural Heritage
ESS 9 Financial Intermediaries
B.3. Reliance on Borrower’s policy, legal and institutional framework, relevant to the Project risks and impacts
Is this project being prepared for use of Borrower Framework? No
Public Disclosure
Areas where “Use of Borrower Framework” is being considered:
No
IV. CONTACT POINTS
World Bank
Contact: Sylvia Diez Title: Senior Environmental Specialist
Telephone No: +1-202-473-3893 Email: sdiez@worldbank.org
Contact: Jose Villalobos Title: Senior Financial Sector Specialist
Telephone No: +1-202-458-1829 Email: jvillalobos@worldbank.org
Borrower/Client/Recipient
Borrower: Caribbean Catastrophe Risk Insurance Facility SPC
Implementing Agency(ies)
May 26, 2020 Page 7 of 8
The World Bank
Caribbean Ocean and Aquaculture Sustainability FaciliTy (COAST) Project (P171321)
Implementing Agency: Caribbean Catastrophe Risk Insurance Facility
V. FOR MORE INFORMATION CONTACT
The World Bank
1818 H Street, NW
Washington, D.C. 20433
Telephone: (202) 473-1000
Web: http://www.worldbank.org/projects
VI. APPROVAL
Task Team Leader(s): Sylvia Diez, Jose Villalobos
Practice Manager (ENR/Social) Maria Gonzalez de Asis Cleared on 24-Mar-2020 at 11:08:6 EDT
Public Disclosure
May 26, 2020 Page 8 of 8