Notes on Micro, Small and Medium Enterprises (MSMEs) in Barbados

Overview

• Position paper discusses the role of MSMEs in Barbados.
• Focus on how MSMEs can utilize Disaster Risk Finance (DRF).
• Barbados known for tourism and international business, but MSMEs are critical for socioeconomic development.

Employment Impact

• Between 2015-2019, micro enterprises in the manufacturing sector employed 6.5% of the population.

Challenges Faced by MSMEs

• Lack of Capital
• Low Profitability
• Inadequate Marketing and Promotion
• Insufficient Workforce
• Difficulty Accessing Financial Instruments
  • Challenges include credit and insurance access.
• Vulnerability to climate-related extreme events and natural hazards.

Importance of Disaster Risk Finance

• DRF can help MSMEs manage risks and protect against financial impacts from disasters.

Barriers to Uptake of DRF

• Small profit margins.
• High insurance costs.
• Limited choice in bundled insurance products.
• Low financial literacy among MSMEs.
• Lack of incentives for MSMEs to engage with DRF.

Recommendations from the Position Paper

1. Cost-Effective Insurance Products
   • Products should address specific challenges of MSMEs.
2. Increased Awareness
   • Develop understanding of insurance products and their benefits.
3. Adequate Coverage
   • Expand product range to enhance recovery from hazards.
4. Flexible Payment Plans
   • Quick payouts necessary for business continuity and recovery.

Call to Action

• Encourage involvement and advocacy for MSMEs.
• Visit Caribbean Policy Development Center's Risk Resilience Hub for more information and research.