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Caribbean alliances key to attracting investment - PwC partner believes region could woo more investors as a bloc

Published:Thursday | June 5, 2014 | 12:00 AM

Jermaine Francis, Staff Reporter

PORT-OF-SPAIN, Trinidad:

CARIBBEAN NATIONS are being urged to create greater alliances among themselves in their quest to attract private investors from outside the region.

Delivering the keynote address on Day Two of the 2014 CIBC FirstCaribbean Infrastructure Conference at the Hyatt Regency in Port-of-Spain, Trinidad, on Tuesday, Richard DesLauriers, partner at PricewaterhouseCoopers (PwC) in Canada, said the region would be better served if it seeks investors as a bloc than if it approached them as separate states.

DesLauriers said there is not much smaller countries can do to convince bigger investors to enter private-public partnerships (PPPs) geared at improving their infrastructure.

"Efforts probably could be made to better market the Caribbean as a region for PPPs because a lot of the non-Caribbean potential bidders don't recognise the Caribbean as a market they should be looking at," DesLauriers explained.

He said small island states generally find it more difficult to persuade big investors that their projects are good enough for financing.

REGIONAL BOOST

"On a country-by-country basis, it is not as compelling a story, but if you look at it on a regional basis, that can be more interesting," DesLauriers argued, adding that regional bodies and multilaterals could aid in facilitating this process.

He said Caribbean countries should also be mindful of their credit ratings and procurement processes if they want to attract more private investors in the development of much-needed infrastructure.

Using Canada as an example, DesLauriers said it has managed to carry out a large number of infrastructure projects through PPPs because the country has maintained favourable credit ratings over the years.

He said investors pay very close attention to the creditworthiness of governments who are behind PPP projects, as they represent a long-term commitment with the Government committed to pay back the investors for their contribution to the projects.

"For a private investor to do that (take on these projects), they have to have confidence that the Government will in fact pay them over that period, and the measure of that confidence really is the credit rating," he said.

Noting that there are several risks in investing in PPPs, DesLauriers said government commitment to ensuring that the legal framework and procurement processes are solid is important as this would help to give investors and the wider public confidence in the projects being undertaken.

jermaine.francis@gleanerjm.com