Castries – St Lucia prime minister Phillip J Pierre appealed on Tuesday for the Caribbean to develop new and innovative financing mechanisms to deal with the prevailing debt sustainability constraints.
Pierre, who has taken over the chairmanship of the board of governors of the Barbados-based Caribbean Development Bank (CDB), said the new strategy must foster social, economic, and environmental resilience.
He was addressing the media launch of the 53rd annual general meeting of the CDB that is scheduled for June next year.
“The classification of many of our countries as middle and high income solely on the basis of per capital gross national income (GNI) is devoid of consideration for inherent vulnerability to environmental and economic shocks and our low propensity for speedy recovery,” Pierre said.
He said this has significantly constrained access to much needed concessionary resources to fund development priorities such as mitigation of and adaptation to climate change.
“It is for this reason that St Lucia is firmly behind the innovative work being undertaken by the CDB to develop the recovery adjustor that seeks to incorporate a reliance adjusted gross national income measure to determine to concessionary finance,” Pierre said.
He said international financial institutions and developed countries want to “align our vulnerability to our financial needs”.
“What is happening now is that the world measures what they call our credit in terms of a GNI…and that means a few who are very wealthy and who are very poor…the country would seem to be very rich, but that is not the case,” he later told CMC.
“Any one of our islands, we can get up at any day in the week and find that we have a hurricane that has wiped out the entire country. It has happened in Dominica, it has happened in Grenada, it has happened in Jamaica, and so on.”
He added: “So what we want to have is a measure, which the CDB is working on, and which says if you are seeking finance, other factors must be taken into consideration, your vulnerability and how quickly you can recover from a disaster.
“This is what we are speaking of when we are speaking of new methods of seeking finance for our region.”
CDB president Dr Gene Leon said the world has been struggling with the idea that GNI was not an appropriate measure of development and not an appropriate measure of access to finance for development for about the past 35 years.
He said that the CDB, the region’s premier financial institution, had taken on board the most vulnerable index and had broadened the concept to be able to distinguish vulnerabilities that may exist before and after a catastrophic event.