WASHINGTON, D.C., USA: The Inter-American Development Bank (IDB) hosted a meeting last week with heads of state and ministers of the English-speaking Caribbean and Suriname at its headquarters in partnership with the Caribbean Development Bank (CDB).
The discussions were presided over by IDB executive vice-president Julie Katzman, CDB president Warren Smith, and IDB executive director for the Caribbean countries, Richard Bernal, with the participation of IDB president Luis Alberto Moreno at the closing session, and with representatives of the Organization of East Caribbean States (OECS), the Caribbean Community (CARICOM), the World Bank and the International Monetary Fund, and other IDB executives.
“We are pleased to offer this platform to discuss the debt problem and obstacles to strengthening growth in the Caribbean,” said Katzman. “The IDB is firmly committed to supporting countries tackle their financial, social and environmental challenges.”
The IDB’s English-speaking Caribbean member countries include The Bahamas, Barbados, Belize, Guyana, Jamaica, Trinidad and Tobago, as well as Dutch-speaking Suriname. The Bank also partners with CARICOM to support regional integration and provides financing and technical support for the OECS members in partnership with the Caribbean Development Bank.
Participants in the dialogue included the director general of the OECS Secretariat, the governor of the Eastern Caribbean Central Bank, Dwight Venner and prime ministers and finance ministers of the following OECS countries: Antigua and Barbuda, Dominica, Grenada, St. Kitts and Nevis, St. Vincent and the Grenadines and St. Lucia.
The IDB regional economic advisor for the Caribbean countries, Valerie Mercer-Blackman, made a presentation to start off a dialogue on ways to foster growth while fighting critical debt problems and preparing for contingencies such as those related to climate change.
Fiscal consolidation was important, but policy options for reducing debt through inflation, fiscal compression, debt restructuring or debt-climate change swaps were limited in the Caribbean, and without growth their effectiveness would also be limited.
Participants also discussed proposals for small highly indebted open economies in the Caribbean, which are vulnerable to external crises, to promote productivity and growth by ensuring structural adjustments beyond fiscal issues.
The IDB suggested three areas to tackle beyond fiscal reform: increase trade cooperation to strengthen private sector development and access potential new markets; encourage energy efficiency and renewable energy to reduce vulnerability to commodity prices and shocks; and improve climate change and disaster risk management.
IDB general manager for the Caribbean countries, Gerard Johnson, closed the event by outlining the main issues discussed and identifying areas in which the IDB and other international and regional organizations may cooperate with each other and with the countries.
As an example, Johnson noted the IDB’s financing to Jamaica for the country’s fiscal consolidation program, based on measures taken by the government following an agenda also supported by a stand-by agreement with the IMF.
Johnson said the IDB is deeply invested in the future of its Caribbean member countries. In 2010, the IDB approved financing for more than US$900 million to English-speaking Caribbean countries and US$12 million for Suriname.
After the consultation meeting, Bernal hosted an event to jointly commemorate the independence days of the five English-speaking Caribbean members of the IDB.