BUSINESS MONDAY: Multilateral financial institutions have failed Caribbean countries: Robinson

THE University of the West Indies (The UWI) economist, Dr. Justin Robinson, has lashed out at the multilateral financial institutions, saying that they had failed small countries just when they require financing to get out of their present predicament.

He was the featured speaker at the 50th anniversary function of the Public Workers’ Co-operative Credit Union Limited, at Hilton Barbados.

“The multilateral financial institutions have failed Barbados and other Caribbean countries by not coming up with a package to assist these states hit hard by COVID-19,” said Dr. Robinson, who heads the Sagicor Cave Hill School of Business.

Dr. Robinson said that these countries do not have the financial resources to undertake countercyclical policies to deal with the economic fallout from COVID-19.

The simple reality, The UWI official remarked, is that as small island developing states, tourism dependent and vulnerable, their fiscal and monetary responses are not adequate.

He went so far as to suggest there could be another lockdown in Barbados in the wake of the crisis.

“These countries are unable to find the financial resources of the scale required to protect productive capacity, life and limbs, and maintain a social order and integrity,” Dr. Robinson remarked.

Noting that the healthcare response to the COVID has been enormous, the Economist argued that Caribbean countries need temporary access to concessionary financing to help to strengthen healthcare systems, social security systems, support for businesses and workers.

He went on to suggest that “it is absolutely critical that the multilateral financial system, of which we have been faithful members since independence, do their utmost to support us through this period”.

Dr. Robinson admitted that the multilateral community – the IMF, World Bank, IDB – had announced some very attractive policies.

The Economist pointed out that while these initiatives are laudable, they nonetheless remained inadequate for the needs of the heavily-dependent economies, and noted that because of their high per capita income, the Caribbean countries are ineligible for that support.

“The multilateral institutions have an obligation to act more boldly to assist our economies at this time,” he added.