At the start of the 45th Meeting Of The Board Of Governors of the Caribbean Development Bank (CDB) in Basseterre, St Kitts and Nevis, yesterday, president Dr Warren Smith warned that solutions to the region’s debt crisis must be found without delay.
Repeating an appeal he made at the 43rd annual meeting in St Lucia two years ago, Smith called for a broad-based Compact Of Cooperation between Caribbean countries and the wider international community to deal with the issue of sovereign indebtedness.
“I asked for us to revisit the strongly held view that middle-income countries, like ours, do not qualify for debt relief.
“In 2014, I raised the issue of debt again in Jamaica at a high-level Caribbean forum sponsored by the International Monetary Fund (IMF). In that forum, I challenged the large multilateral institutions to use their balance sheets creatively, as CDB had done in St Kitts and Nevis in 2011, to address this country’s debt problem.
“Mr Chairman, I make bold to place the debt issue on the table, once again! I humbly submit that the sentiments expressed in St Lucia and in Jamaica remain just as relevant today, and are in urgent need of a solution.
“This is not an intractable problem if we heed the UN Panel’s injunction to be uniformly ambitious.”
Smith also outlined what he called the “unfinished agenda” the Caribbean must tackle to realize structural transformation that would overcome obstacles to sustained prosperity.
Noting that Caribbean countries had been slowly emerging from the global economic crisis, the CDB president urged governments to take strong action to reverse their fortunes.
“We believe firmly that governments must set aggressive timelines for implementing reforms that create more business-friendly environments.
“We want fiscal management to become more predictable in our borrowing member countries. Fiscal rules, backed by tough legislation, must become the norm rather than the exception. And, building fiscal buffers must also become an integral component of every national sustainability strategy.”
Smith also advised the Caribbean, which has been experiencing the damaging effects of climate change, to support the creation of a Project Preparation Facility, which would enabled CDB borrowing member countries to develop a pipeline of “bankable” projects that would be eligible for climate financing.
“These projects would include climate-proof roads and other critical infrastructure. They would also address the vulnerability of our islands and coastal zones in order to protect vital industries, such as tourism, agriculture and fisheries.”
The opening ceremony, held at the St Kitts Marriott Resort, also heard a call from Minister of Finance Chris Sinckler for regional states to set a new agenda for reform that combines systems that worked in the past with new technologies to
create a more enabling environment for economic expansion.
“. . . A new platform to ensure that vital sectors are strategically positioned and supported by developmentally strong
human populations and environmentally secure countries.”
But Sinckler warned that as countries re-engineered their economic structures, they could not afford to leave people behind.
“We must not afford ourselves the luxury of forgetting that there is no security in economics if there is insecurity and unsalvageable dislocation in society. Success in building out both must be achieved as a symbiotic advance, with each undergirding the other, but none acting in a way to undermine the overall object for balanced growth and development.”
Sinckler’s position was endorsed by St Kitts/Nevis’ Prime Minister Dr Timothy Harris, who made a case for new economic strategies that meaningfully addressed the needs of the region’s people.
Expressing concern about the growing level of poverty, he complained that the banking system within the Organization of Eastern Caribbean States was overflowing with cash, while youth with big ideas but no money were languishing.
“It is perhaps here that a Development Bank must bring a new focus, new attention and new resources to help us to pursue a people-centred path of diversification in which a new, local entrepreneurial class is nurtured and supported.
The new head of government also proposed that countries develop an integrated regional approach to the production and distribution of alternative energy and a new approach to the economic citizenship programme.