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Results Briefs May 8, 2018

Promoting Evidence-Based Policies for Inclusive Growth in OECS Countries

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The Commission and members of the Organisation of Eastern Caribbean States have developed policies to improve statistical capacity and produce comparable statistics for evidence-based policy making by addressing the limited capacity typical of small island developing states. Under a regional approach, member countries have benefited from economies of scale and South-South knowledge exchanges to build statistical capacity and to develop innovative, timely, cost-effective methods for data collection and data analysis.

Challenge

The member nations of the Organisation of Eastern Caribbean States (OECS) are highly susceptible to external and climate shocks. While the OECS countries experienced high levels of growth in the 1980s, they have experienced significant growth slowdowns since the 1990s, with annual growth rates of 2 percent or less on average. Natural disasters are estimated to have cost an average of 3 percent of gross domestic product (GDP) in the twenty years through 2015. Preliminary estimates of damages in Dominica from Hurricane Maria in 2017 have reached as high as 200 percent of GDP. Vulnerability and low levels of growth threaten the region’s path to reduced poverty and shared prosperity.

OECS members neither collect nor monitor poverty indicators on a regular basis. The latest poverty estimates were produced by the Caribbean Development Bank (CDB) Country Poverty Assessment (CPA) between 2005 and 2009. The limited data suggests that over the past decade poverty declined less than in the Caribbean than in the Latin America and the Caribbean (LAC) region overall. Moreover, given resource constraints, updated poverty assessments have not been completed. Targeted poverty-reduction interventions therefore lack current poverty data.

Weak statistical capacity is common among OECS members, especially human, technical, and financial resources. Several countries, including Antigua and Barbuda and St. Vincent and the Grenadines, have recently conducted their first labor force surveys. The latest Household Budget Survey (HBS) for many OECS countries was carried out in mid-2000s, financed by the CDB. Frequently, data documentation and storage systems are lacking. These and other deficiencies result in substantial data gaps, and many Caribbean countries thus rank low on the Bank’s Statistical Capacity Indicator.

Approach

The Bank adopted the Caribbean: Poverty and Equity Programmatic Approach and related initiatives for tackling the limited statistical capacity typical of the small island developing states. These efforts include:

  • An innovative, cost-effective approach to data collection and analysis that requires fewer human resources than traditional approaches; for example, computer-assisted personal interviewing (CAPI) methods were used for data collection and automated economic analysis software was used for data analysis.
  • A regional approach that standardizes the statistical system, allowing OECS countries to benefit from economies of scale and South-South knowledge exchanges, using, for example, the OECS Regional Strategy for the Development of Statistics.
  • A systematic approach that gradually builds capacity from a simple survey, such as the Labor Force Survey (LFS), to more complex efforts, such as the Household Budget Survey, and that improves systems sequentially from the initial steps of data collection to the final steps of data dissemination.

Results

Bank lending, trust fund financing, and analytical support between 2014 and 2017 helped achieve the following results:

  • Increased cost-effectiveness and timeliness of data collection: OECS member states received training and technical assistance in the use of CAPI methods for data collection. The advantages of using CAPI include (i) reduced turnaround time between survey collection and production of analysis, (ii) ability to program question checks and skips in questionnaires, and (iii) decreases in data errors previously generated by the scanning process. St. Lucia and Grenada, early adopters of CAPI, now run the LFS on a quarterly basis.
  • Adoption of harmonized statistics and statistical practices: The Bank and other development partners’ support for a regional approach to building and strengthening institutional, organisational, and human capacity for statistical development across the OECS region was expressed in the OECS Regional Strategy for the Development of Statistics (RSDS). The OECS countries have adopted the standardized Labor Force Survey and Household Budget Survey. Labor market statistics are now comparable, helping to inform regional economic planning. Poverty assessments and a multidimensional poverty index were also developed at the regional level.
  • Enhanced economies of scale and South-South knowledge exchanges: Integration of the OECS countries into an economic union allowed them to share fixed infrastructure costs and to rely on country connections to achieve some economies of scale in adopting new forms of technology, training, capacity building, and knowledge dissemination. Several Bank trainings were conducted in regional workshops. Some OECS countries more advanced in adopting innovative approaches and producing statistics, such as St. Lucia, led the South-South knowledge exchange in workshops and consultations with other OECS members. The follow-up workshop on using CAPI for data collection, for example, was conducted by the Statistical Office of St Lucia.
  • Use of data for evidence-based policy making in some OECS countries: Grenada presented employment numbers in presenting its budget and used the LFS to monitor labor market trends. St. Lucia regularly uses LFSs for labor market monitoring and analysis. Antigua and Barbuda, St. Kitts and Nevis, and St. Vincent and the Grenadines are preparing their first labor briefs.

Bank Group Contribution

The Bank, through the Trust Fund for Statistical Capacity Building, oversaw the distribution of project financing in the aggregate amount of US$500,000.  

In addition, credits from the International Development Association, financed the St. Vincent and the Grenadines Household Budget Survey and enhanced Country Poverty Assessment (eCPA). Under this project, the harmonized HBS will be conducted using a cost-effective approach, CAPI. The new HBS and eCPA will help identify the poor and vulnerable, improving the targeting of social protection policies.

Partners

Several project activities have been implemented jointly or in close coordination with other donors and development partners. The Caribbean Development Bank approved an enhanced 2015–2019 eCPA and is expected to finance the collection of the Household Budget Surveys and the eCPA for each member state. The Bank and the CDB cofinanced St. Lucia’s 2015–2016 HBS, which is expected to become a model for other member states under the CDB eCPA project. The Bank is financing St. Vincent and the Grenadines’ 2018–2019 HBS and eCPA and, jointly with the United Nations Development Programme (UNDP) under the Department for International Development Externally-Financed Output (DFID EFO), it supported the development of the OECS RSDS, which emphasizes the need to pilot innovative methods to collect, document, and disseminate data in the region. UNDP and CDB have also supported CAPI methods by supplying hardware.

Beneficiaries

National Statistics Offices in the OECS have moved from paper to electronic environments, facilitating data collection processes. Edwin St. Catherine, Director of St. Lucia’s Central Statistics Office, has commented on this transition: “It assists us in collecting interviews … and also allows us to collect better data.... What we are doing here today is sharing experiences in a South-South cooperation. Hopefully, [other member states] can take a lot of information back to their individual countries so data collection is done in a more effective way.”

Regular availability of current poverty and labor market statistics allows governments to make more effective policy decisions. The Honorable Oliver Joseph, Grenada’s Minister for Economic Development, Trade, Planning, Cooperatives, and International Business, stated at the official launch of the OECS Regional Strategy for the Development of Statistics, “These are the factors that have us, the policy makers, juggling scarce resources among demanding and competing public services. How much do we spend on roads? How much do we allocate to health services? To education? I can certainly attest to this daily challenge, having a portfolio for Economic Development, Trade, and Planning. My decisions and policy proposals are hindered without evidence: timely and relevant data.”

Moving Forward

The Bank will continue its partnership with the OECS Commission and member states to promote evidence-based policy making that fosters inclusive growth, builds resilience and sustainability, and informs regional economic planning. The Bank will also continue to leverage its expertise and help mobilize other development financing to achieve sustainability and regional development, with these particular goals foremost: (i) to increase the frequency of data collection and poverty estimates, (ii) to produce comparable and timely statistics, and (iii) to support the design and formalization of the OECS Regional Statistical System.