Damage a car travelling round island country (5,4)
I believe the answer is:
costa rica
'country' is the definition.
(Costa Rica is an example)
'damage a car travelling round island' is the wordplay.
'damage' becomes 'cost' ('damage' can informally mean a price or cost).
'travelling' indicates an anagram.
'round' means one lot of letters goes inside another.
'island' becomes 'i' (geographical abbreviation).
'car' anagrammed gives 'rca'.
'rca' enclosing 'i' is 'rica'.
'cost'+'a'+'rica'='COSTA-RICA'
(Other definitions for costa rica that I've seen before include "place in Central America" , "Central American republic" , "international team?" , "A Socratic kind of country in S America" , "source of coffee" .)