Dr. Ram: Region underperforming

“Our 19 borrowing countries are underperforming significantly.”

That is according to Dr. Justin Ram, Director of Economics at the Caribbean Development Bank (CDB), while speaking yesterday at the Central Bank of Barbados 37th Annual Review Seminar, ‘Practical Solutions to Strengthen Economic Growth and Adjustment in Small Open Economies’ at the Radisson Aquatica Resort.

“Compared to comparative groupings around the globe, we are underperforming significantly. Yes, we are small open economies, but when you look at other small island developing states, they are performing. Maybe there is something structurally wrong. The question is, ‘How can we move beyond slow economic growth?’”

It was further stated that, “In a nutshell, we have low growth and high level of debts. We have high levels of unemployment, but youth unemployment is even higher. As policy makers, we should be concerned also about the possibility of social problems related to high youth unemployment.

In addition to this, we have low levels of productivity and competitiveness; this is not new information. Furthermore, we live in a bad neighbourhood in terms of natural disasters, which impact the level of debt because of the recovery from natural disasters that often means that we are building up levels of debt.”

Dr. Ram added, “We ranked our countries with respect to their debt to GDP ratio and Barbados has the highest debt to GDP ratio in the Caribbean, previously it was Jamaica, now Jamaica in the last few years has taken steps to ensure that their debt to GDP ratio is going in the right direction. However, that is not the case for most of our borrowing member countries, although Barbados is at the top now, we also have other countries that are also on the wrong trajectory. Trinidad and Tobago is also on the wrong trajectory. The lessons learnt from Jamaica and perhaps Grenada, show that we can turn things around if we take the right policy measures and steps.”

According to him, “A lot of projects are not finding their way to implementation, but why do we have implementation deficit in the Caribbean... as serious policy makers we need to start doing something about it. In addition to this as we look at foreign currency reserves, many of our borrowing member countries we have reserves that are well below the benchmark level of three months of import cover …Trinidad has a lot of foreign exchange reserves... But if you are in Trinidad you can’t seem to get foreign exchange, something has gone wrong in the market.” (NB)