CARICOM pursuing new economic model

PORT OF SPAIN, Trinidad, November 30, 2009 – The Caribbean Community (CARICOM) is seeking international support for a new economic model which Guyana’s President Bharrat Jagdeo says is urgently needed.

Backing for the new model is being canvassed and United Nations Secretary General Ban Ki-moon and the heads of several multilateral financial institutions are to join CARICOM leaders in Dominica in March to discuss it, President Jagdeo told reporters over the weekend while attending the Commonwealth Heads of Government conference in Trinidad.

Jagdeo, current CARICOM Chairman and head of the regional economic task force addressing the impact of the global economic crisis on the 15-member community, maintained that the model of economic development the region has been pursuing is not sustainable given its peculiarities.

He said huge debt overhang and massive sums spent to service debt have affected the community’s capacity to intervene in the current global economic crisis which has had a major impact on its members.

He noted that the two largest industries in the region – tourism and the financial sector – have been affected and capacity and fiscal space to do anti-cyclical spending has been limited because of the debt overhang.

“There is no way we are going to build a viable medium term economic strategy without a change in the model,” Jagdeo insisted.

He said CARICOM has argued that the model that would be viable for the Caribbean would be one that sees debt relief for middle income countries; special and deferential treatment in the global trading system; dedicated instruments from the multilateral financial institutions (MFIs) to target the special vulnerabilities of the region – like a contingent line of credit to deal with hurricanes and other natural disasters which have a systemic impact on their societies.

The new economic model and climate change were the two big issues for the region, he said.

“It was important that we advocated for both and that we seek the support of this broad range of countries across the world because this support would be vital when we get to the WTO (World Trade Organisation) or when we take specific measures to address these issues at the boards of the multilateral financial institutions,” he said.

The President chaired a meeting Saturday between CARICOM and British Prime Minister Gordon Brown, while in Trinidad, and said he dealt with the impact of the global financial crisis on the Caribbean. He said the region’s leaders asked for support for the model they intend to pursue.