Focus on competitiveness, CDB director urges region

With Caribbean countries gearing up to recover from the coronavirus crisis, Caribbean Development Bank Director of Economics Ian Durrant is encouraging both private and public sector leaders in the region to prioritise improving competitiveness as a means to achieve inclusive growth.

The office of the Caribbean Development Bank in St Michaels, Barbados. (Photo: caribank.org)

Last Thursday, during a virtually held seminar, Reimagining Caribbean Economies in the Wake of the COVID-19 Pandemic, the director opined that the region’s economies, due to their size, had no reserve currencies and relied heavily on imports to maintain standards of living.

“This means that increasing gross domestic product, increasing incomes, and improving standards of living in a sustainable way requires export growth. But this export growth must be diverse to ensure that there are not major setbacks when one export industry is affected by a shock. In turn, diversification requires enhanced competitiveness,” Durant said.

As part of the CDB’s efforts to improve competitiveness across the Caribbean, he said the financial institution will place digitalisation and physical resilience at the core of its strategies.

“We need to create digital citizens with access to the internet and services online,” he continued

At the same time, Durant underscored that based on the Caribbean’s susceptibility to natural hazards, it was equally important for the bank to prioritise improving physical resilience and upgrade infrastructure. In this regard, Durant urged citizens to hold senior government officials accountable on national development objectives.

Ash and smoke billow as the La Soufriere volcano erupts in Kingstown on the eastern Caribbean island of St Vincent.
(Photo: Robertson S Henry/Reuters)

Pandemic impact

Some 13 borrowing member countries have reported double-digit declines in gross domestic product (GDP). Meanwhile, regional exports fell by 26 per cent while imports decreased by 27 per cent in 2020. BMCs that had debt-to-GDP ratios above 60 per cent increased to 13 in 2020, compared to nine in 2019.

In terms of recovery, the regional bank projects a moderate, average growth of 3.4 per cent.

Both imports and exports decreased by over 20 per cent in the Caribbean. (Photo: Qilai Shen/Bloomberg)

Panellists who contributed to the virtual seminar included: Gregory Bowen, minister of finance, economic development, physical development and energy, Grenada; Marsha Caddle, minister of economic affairs and investment in the Ministry of Finance, Economic Affairs and Investment, Barbados; Nigel Clarke, minister of finance and the public Service, Jamaica;  and James Thompson, minister of state for finance, The Bahamas.