President Bharrat Jagdeo told leaders at the recent Caricom summit in Antigua that there is need to craft a strategy for middle-income debt relief for vulnerable Caribbean countries and that Jamaica should take the lead in advancing the proposal to the G8 countries.
According to a Government Information Agency (GINA) press release Jagdeo used Guyana’s record as a model for other countries to emulate. He told the 29th Caribbean Community summit that it has been two years since Guyana exited the International Monetary Fund programme to which it was committed for 18 years. He said Guyana was able to move its stock of debt from 750 per cent Gross Domestic Product (GDP) to 45 per cent since 1992.
On examining the situation facing some middle-income Caribbean countries, including the Organisation of Eastern Caribbean states, Jagdeo said, “quite a few of them have debt to GDP ratios of more than 10 percent, as high as 180 percent in some cases and they use a significant part of their revenue and foreign exchange to service those debts.” On this note Jagdeo submitted that the Caribbean needs to craft a strategy to get the issue on the agenda of the G8 countries. “That’s the only place it will make a difference. The IFIs (International Financial Institutions) are not going to address these issues by themselves. They do not have the instruments available to them to give debt-relief to middle-income countries,” he said. Further he said, should debt-relief be granted to such countries the same courtesies would have to be extended to larger middle-income countries like Mexico, Argentina and Turkey. The President said the best strategy is to craft space for small developing countries, “who by their peculiarities, are very vulnerable, especially those in the Caribbean.”
No coherent strategy
Jagdeo said over several years the Caribbean has talked about a possible proposal to the G8 but to date this has not happened as there has been no coherent strategy to move the idea forward. In this light, the President said Jamaica is best placed to advance the proposal and he has offered all the necessary assistance to that state’s finance minister. He told reporters that in order to push the proposal a number of things need to be done: technical studies and soliciting the Heads of the IFIs and NGOs. Jagdeo pointed out that Jubilee 2000 helped Guyana to put multilateral debt-relief on the G8 agenda and as such they should also be included.
The President said too the Caribbean needs to lobby for countries at the level of the G8 to champion its cause for middle-income debt relief. However, he noted that this would be for small states which rely on one or two crops, which have small domestic markets and those which are vulnerable to hurricanes. Jagdeo said some middle-income Caribbean countries owe large amounts and that is why the issue will not be addressed across the board. “It is more manageable when it comes to small countries … and it is more possible to succeed rather than if we argue for middle income debt relief generally,” he said.
Meanwhile, in response to Jagdeo’s assertion that Jamaica is best placed to advance the proposal to the G8, Prime Minister Bruce Golding said his country has already started soliciting the Group of Eight (G8) endorsement of the issue. Golding said he has had extensive discussions with British Prime Minister Gordon Brown and that he has been given assurances that the matter would be pursued.
According to GINA, Brown said too that a high level meeting is planned for September 4 in New York and he is hopeful that it would provide a framework within which the Caribbean could solicit a response from the G8. The meeting is expected to be hosted jointly by Brown and Commonwealth Secretary-General Kamlesh Sharma. Golding noted that any multilateral initiative especially one of such magnitude is not likely to garner much action unless it secures some acceptance from the G8.
He is therefore, looking forward to the forum which will be held on the margins of the United Nations General Assembly.
