Sat | Mar 28, 2020

Anthony rejects notion of Caribbean as failed economies

Published:Tuesday | June 16, 2015 | 5:38 PMMcPherse Thompson

St Lucia’s Prime Minister, Dr Kenny Anthony, has challenged regional governments to dispel the widespread notion that they are all managing failed economies and instead work together to develop a model that confronts the present economic realities.
“I do not subscribe to that perspective. These economies may be broken but I believe we can pick up the pieces,” he said Tuesday.

“I believe that our historical task is to conceptualise, shape and define an economic model that answers to the times and to our needs,” the Prime Minister told participants  at the opening of the third Caribbean Growth Forum, organised by the World Bank in collaboration with its multilateral partners at Sandals Grande St Lucian Resort.

His comments were endorsed by Vice President of the World Bank for Latin America and the Caribbean, Jorge Familiar, and Director of Economics at the Caribbean Development Bank, Justin  Ram, who explicitly agreed that there are no failed economy in the region and that they can build on what have been achieved so far.

According to the World Bank, governments have expressed interest in tracking the progress made on the reforms identified according to the three pillars of the growth forum: logistics and connectivity, investment climate and skills and productivity, as well as issues around trade and competitiveness, entrepreneurship and innovation.

Dr Anthony said they were gathering once more against the backdrop of weak growth outcomes evidenced by low average growth of 1.1 per cent for the Caribbean region over the period 2008 to 2013.

Given that anaemic performance, he said, the region’s governments agreed to work with major donor partners to establish an initiative aimed at identifying short term policy actions to facilitate enhanced competitiveness.

Dr Anthony said it was no secret that the global financial crisis, which started in 2008, has adversely impacted the economies of non-commodity exporting Caribbean states.

The crisis accentuated structural weaknesses within those economies as foreign exchange inflows decreased due to lower tourism arrivals.

Added to that were high levels of unemployment, triggered in most instances by job losses and limited capacity of domestic firms to absorb new entrants in the labour market.

In the post-financial crisis period, the Prime Minister said, even as the economies of the region’s major trading partners have begun to recover, all Caribbean countries have experienced decelerated foreign direct investment (FDI).

He pointed to a 2015 report by the Economic Cooperation on Latin  America and the Caribbean which showed that FDI inflows into the Caribbean sub-region declined by 4.7 per cent in 2014 after falling by more than a third since 2008. 

“This holds true even for the region’s largest economy and top recipient of FDI inflows, the Dominican Republic. FDI into this nation, while increasing by 11 per cent in 2014, was less than the amount received in 2012,” he said. 
Cognisant of the region’s fiscal challenges and limited policy options, governments of the Caribbean have had to implement measures to alleviate the economic crisis, the St Lucian Prime Minister added.

Notwithstanding that, “if today’s discourse is to yield true fruit, we must acknowledge that declining growth in the Caribbean featured from the mid-1990s” and was not just a phenomenon of the post 2008 period, Dr Anthony said.

Referring to recent discourse in and about the region, he said the debate has focused on a raft of oft-repeated business and structural reforms to remedy the problems.

“Some of this, I readily concede, is tiresome. It is easy to dismiss it all by the usual quip: ‘We have heard it all before’,” he said.

“My simple point is that there has been no shortage of analysis on these issues. What eludes us is agreement on the solutions and consensus on the way forward. Therefore, our gathering in St Lucia for this third region workshop is a further step in both identifying solutions to effect change and building national and regional consensus on these proposed solutions,” the Prime Minister said.

The launch of the Caribbean Growth Forum three years ago initiated dialogue between representatives of business associations, civil society groups, government, private sector and international development agencies on growth and development in the region.

So far, 12 countries have launched their national chapters -Antigua & Barbuda, The Bahamas, Belize, Grenada, Dominica, Dominican Republic, Jamaica, St Kitts-Nevis, St Vincent & the Grenadines, Suriname, Trinidad & Tobago, and St Lucia.