Governor-General of St Kitts and Nevis
Prime Minister Timothy Harris
Sir Governor Dwight Venner
President Warren Smith
Deputy Managing Director Min Zhu
Ministers, partners and colleagues
Unlocking finance for growth in the context of a less favorable global economy is key for Caribbean countries, many of which are facing gaps in financing, heavy debt burdens, and high vulnerability to economic shocks and natural disasters.
Just a couple of months ago, Prime Minister Kenny Anthony of St Lucia hosted the third regional Caribbean Growth Forum to discuss new strategies and tools to achieve growth. One key take away from the discussions in St Lucia was that being small has a number of advantages. For instance, small states can be more agile in ensuring high competitiveness. A number of small states ranked at the top of the 2014 Global Competitiveness Index including Singapore, Mauritius and Malta.
In the western hemisphere, a good example is Costa Rica that some years ago took a proactive public policy approach and embarked on a comprehensive set of reforms to transform an agricultural based economy into a high tech export economy to address an unsustainable debt problem.
Given the large debt burdens faced by many Caribbean countries, financing growth calls for combining public and private finance.
To free up greater public financing for growth, continued efforts on fiscal consolidation and structural reforms are essential: There is no doubt that putting the fiscal house in order is a must. But high debt burdens also stem from weak competitiveness, low productivity, low skill levels, high logistics costs and poor connectivity. In this context, St Kitts, Jamaica and Grenada have continued on a path of reforms that are contributing to reduce their high debt burden.
However, in view of the large infrastructure gaps and other investment needed, it is clear that financing growth calls for significant private sector participation.
So far, levels of Foreign Direct Investment have remained high, but have not translated into much growth. There have been few successful public-private partnership projects, and the local private sector has suffered from low levels of access to finance for investments.