One of the Caribbean’s most experienced politicians, Barbados Prime Minister Mia Mottley, has raised the grim spectre that some small-island developing states – numbered among which are several Caribbean Community (CARICOM) member countries – could simply collapse under what might become the unbearable weight of COVID-19.
A story published in the Trinidad and Tobago Guardian of Wednesday May 20 quoted the CARICOM Chair as saying in her address to the 73rd World Health Assembly that while some countries will enjoy the good fortune of successfully restructuring their economies others will not be so fortunate. “Many countries will either have an orderly restructuring of debt or at the very least a debt moratorium that provides certainty for both the borrower and the lender, or they will have a disorderly unravelling that will create a crisis both within their respective countries and within the global financial markets,” Mottley is quoted as saying. And according to the CARICOM Chair, the falling apart of some of the small-state economies will not be without consequences for the rest of the world.
According to the Barbados Head of Government, it is for this reason that the Caribbean is of the view that the necessity has arisen for discourse among middle small-island developing countries across the globe on matters relating to debt obligations in the current environment of the coronavirus pandemic.
Describing Barbados’ recent major debt-restructuring exercise as a “leap of faith,” Mottley said that the restructuring exercise had embraced natural disaster clauses in the nation’s domestic and external debt instruments that provide for greater fiscal space to be created through a moratorium on the payment of principal. It also allowed for a capitalization of the interest, should the country face a natural disaster. Contextually, she contends that were natural disaster debt relief clauses available in the context of this (coronavirus) pandemic, it would bring tremendous relief to those countries and better position many of us to rebuild in a post-COVID-19 environment.”
Already long suffering from high debt and low growth rates, Mottley says, Caribbean economies, in view of their high dependence on tourism and travel had, in effect, exposed their economies and their people in a manner that had not been experienced since the countries became independent, in many instances, more than half a century ago. The current crisis, she said, necessitates global leadership that allows for the region to rebuild its humanity, environment and the equity which she says it needs at this time. The Barbadian Prime Minister is of the view that “apart from having brought people together it has also shone a light on the inequalities in societies,” the Trinidad Guardian reports.
