AMIDST GLOOMY assessments for most economies of the 15-member Caribbean Community (CARICOM), Guyana is forecast “to lead the way with real GDP (gross domestic product) in 2013 projected at around five percent…” That’s the official assessment from the Barbados-based Caribbean Development Bank (CDB), as outlined by President Dr Warren Smith in his annual start-of-the-year press conference, as he looks back at developments in 2012 and points to “positive”  and  “concerned” outlooks for this year.

At his press conference, President Smith warned member countries of the regional institution to avoid facing their own “fiscal cliff” — as happened to the USA — by moving vigorously to reduce their “mounting debt stock”. 

At least seven borrowing countries currently confront this economic challenge. They range from the Caribbean Community’s sole energy-based economy, Trinidad and Tobago, to Barbados, (which formerly boasted a record in robust economic management); to current crisis-ridden economies like Jamaica, Grenada, St. Kitts and Nevis and Grenada.

In his more-than-two-hour-long press conference, supported with printed statements and graphs, President Smith discussed and answered questions varyingly related to the CDB’s role as more than a provider of financial aid to borrowing member countries (BMCs), as well as how it interacts with international financial institutions and donors involved as partners in this region’s economic and social development.

In reviewing the CDB’s activities for 2012 and providing the “economic background and prospects” for 2013, he disclosed that the debt levels of the seven BMCs (Jamaica and St Kitts and Nevis (the two highest), Antigua and Barbuda, Barbados, Belize, Dominica and St. Lucia) “have become unsustainable”; and he emphasized that “anchoring investor confidence, both at home and abroad, will require governments to take corrective policy action…”

Fiscal policy agenda

As analysed by the CDB, “the fiscal policy agenda” of the seven economies identified with “unsustainable debt levels” must include measures that tackle improvements in tax yields by reassessing the range of exemptions and concessions offered, as well as by “improving compliance and collection of arrears, (also) improvements in expenditure, (and) management systems should increase the focus of progammes with high development impact and cost minimization…”

At a time of high unemployment levels for developed economies in Europe and the USA, unemployment levels remain a major factor in the still “unfolding” global crisis.

Available data provided by four of five borrowing countries disclosed the following jobless scenario for 2012: St Lucia 21.2 percent; The Bahamas 14.7 percent; Jamaica 14 percent, and Barbados 12.2 percent.
In contrast, Trinidad and Tobago was showing a mid-year unemployment of merely four percent, compared with a 5.8 percent rate at the end of the first quarter of 2011.