C’bean states must examine growth opportunities

THERE is a role for central banks across the Caribbean, along with the Caribbean Development Bank, in helping the region to finance its economic development goals.

This is the view of Dr. Shelton Nicholls, former Deputy Governor of the Central Bank of Trinidad and Tobago.

He also said recently in Barbados that there must be investments by both the public and private sectors to aid in the process of economic development.

Dr. Nicholls gave an address at a seminar which the Central Bank of Barbados held at the Radisson Aquatica Hotel. The Trinidadian official revealed that the Caribbean region is once again at a critical crossroad in its growth and development trajectory.

“Ultimately, success will largely depend on what future development path the region opts to take,” he stated.

The Economist recalled that, in the past, the region relied heavily on official, multilateral inflows to fund various aspects of our development programmes.

 However, he noted that these avenues for financing development have been diminishing considerably in the aftermath of the global financial crisis.

He stated that while Caribbean states are in the process of exploring funding opportunities from the new growth poles, we also need to look at opportunities in our own spheres.

“Perhaps, the time is right for the central banks of the region and the Caribbean Development Bank, to get together and issue a suite of long-term development bonds in the liquid markets in the region, to kick-start our development drive,” Dr. Nicholls said.

According to him, “The Caribbean region should ensure that it does not lose sight of the bigger goal of economic transformation and development. We need to ensure that the strategies that we are currently grappling with to rekindle economic growth do not just address the immediacy of current challenges, but really take us some distance along the road to achieving a sustainable development path.”

He advised that short-term tinkering alone with our macroeconomic and financial environment, while crucial for economic stabilisation, may not give us the fillip that we really need to push our economies out of the current stasis.

“Our survival will ultimately depend on finding several engines of growth, which together would give us enough of a diversified base to remain on a sustainable growth path,” he reasoned.

“We must of necessity begin to take chances with developing some of the latent industries (like the creative arts, the cultural sector and sports) that have been under our noses for some time,” Dr. Nicholls maintained.

He pointed out that building these engines would require significant investments from the public as well as the private sector.

“Issuing a long-term development bond for the Caribbean might be a place to start,” he added, while noting also that the first imperative is to reform and diversify our productive sectors to enable the emergence of a new set of goods and services.