The 43rd annual meeting of the Caribbean Development Bank (CDB) Board of Governors in St Lucia last week, had the aura of a stocktaking of the state the region’s economies, in a context of persistent difficulty being experienced by many of the member countries. Speeches by both Prime Minister Kenny Anthony, as host Chairman of the meeting and Dr Warren Smith, the President of the Bank, gave voice to what is a general concern in the region. There is the feeling that too many Caricom member states are bogged down in deep financial difficulty, with a seeming inability, over the last many years, to stabilize financial systems and resume economic growth.
The Bank’s meeting follows a year in which the economy of Jamaica, in particular, has been subjected to long negotiation with the International Monetary Fund (IMF), eventually arriving at an agreement which is probably the harshest experienced by any country in the region. And not only that. For in addition, there seems much doubt, both in Jamaica and beyond, that the measures intended to ensure stabilization of the financial system, are likely to induce in the forseeable future, significant possibilities of upward movement to economic growth.
In that respect a statement in President Warren Smith’s address to the conference is notable, sounding almost like a warning to those who have administered the medicine to Jamaica: “We should never forget the lessons of adjustment programmes of the 1970s and 1980s. Some of these were so fixated on solving the fiscal problem that they laid waste social sectors like education and health, with devastating long-term consequences. Those lessons need to inform our current approach.”
Dr Smith could well have had in mind the experience of Guyana, when, in the late 1980s into the early 1990s, the beginnings of a domestically agreed plan for a return to economic stabilization were accompanied by favourable consideration of needed assistance from some major Commonwealth and other countries to, as it were, smooth the passage of austerity, and begin support for resumed growth by the failing productive sectors. He called for what he described as a “broad-based Compact of Cooperation between Caribbean countries and the wider international community,” asserting also that “We cannot do it alone.”
The opening address by Prime Minister Kenny Anthony also gave attention to the parlous economic situation being experienced by many Caricom states. He no doubt would have had the difficult fiscal situations of most OECS countries on his mind. But in the Eastern Caribbean, people and governments are also closely following the current economic situation in Barbados, normally a country whose economic management they would look up to, and expect not to descend into the economic doldrums experienced by others.
Prime Minister Anthony also adverted to the need to find, or at least deliberately pursue, a path of economic integration – reconstructing the common economic space of Caricom, as a means of facilitating economic growth in member states. But his listeners would immediately have felt that that particular clarion call is being made too often by those who are supposed to be responsible for making it a reality.
The question in the mind of listeners will also have been why there seems to be so much difficulty, or reluctance, to bring the measures for implementing the Single Market and Economy (CSME) into effect. Is it a case of the community’s leaders not being convinced that the strategy outlined for implementing the CSME is likely to be effective? Or is it the case that they cannot perceive a possible operational strategy for pursuing what may seem to be laudable objectives, but not effective plans? For surely, the decision to place a ‘pause’ on pursuit of the CSME will not have struck an acceptable chord in the international community, where major countries, particularly in the European Union with which we have an Economic Partnership Agreement, seem themselves to be persuaded that a significant part of the solution for their own present fiscal problems is, as they put it, “more integration not less.”
And surely too, disappointment abroad about what would appear to historical donors in the international community to be our reluctance to connect individual country economic growth with medium-term planning and implementation of a single Caricom economic space, will surely mean a certain reluctance on their path to enthusiastically pursue a Compact of Cooperation designed to find new bases for regional economic growth.
The Caricom public will not have been privy to the discussion that followed these speeches, and will not know whether the issue of finding new paths to economic growth, as distinct from economic stabilization, will have been extensively considered. No doubt the CDB President will be hoping that an “in principle” authority for pursuit of a compact will allow a discussion with the international donors, and therefore with CDB member states, that can lead to some future planning about the part that regional integration can play in stabilizing, and then inducing economic growth in individual member states. For there is, and has been for some time now, talk about common air transportation, sea transportation and energy planning, but year by year, nothing more seems to come out of Caricom communiqués.
Prime Minister Anthony, in his speech, called for a return to an institution like the Caribbean Group for Cooperation in Economic Development – presumably something not dissimilar from the CDB President’s call for a compact. But Anthony, no doubt conscious of recent criticisms, insisted that such an institution must pursue agreed objectives “with specific timelines.” But clearly the preliminary international response will be that Caricom must make up its mind, and commit to sticking to agreements made.
In the meantime, as Vice President Biden has come and gone from his discussions with our heads of state and government, he, and we, will have been bearing in mind the recent meeting in Costa Rica, on which we recently commented editorially, of President Obama with Central American governments, at which both Belize and the Dominican Republic (whose President will also have been in Port of Spain) were invited to be present. President Obama was obviously impressed with the signing and implementation of the US-DR-CAFTA agreement, and no doubt, in the back of the minds of our American visitors there will been a question on whither, and when, a US-Caricom FTA.
