One of the Caribbean’s leading economists is urging Barbados and other islands in the region to establish public investment funds and pump more money into initiatives that make people, not just infrastructure, more resilient.
Trinidadian Dr Justin Ram, who is chief executive officer of Justin Ram Advisory, and a former director of economics at the Caribbean Development Bank (CDB), made the suggestion as he argued that the economic model used by Barbados and the wider Caribbean was leaving them “very, very vulnerable”.
“We tend to focus on gross domestic product. We need to accumulate as much foreign exchange as possible so that we can import, primarily. What we consume is actually about 70 to 100 per cent imported. In my humble opinion, you can’t build resilience on that,” he said.
“In that type of economic environment, we are not focused on the human condition and human well-being.”
Ram was delivering a keynote address on the topic Nexus Of Economics And Sustainability on Wednesday on the third and final day of the Caribbean Sustainable Infrastructure Conference 2025 at Hilton Barbados Resort.
The event was hosted by the CDB, in association with the United Kingdom Foreign, Commonwealth and Development Office and the French Development Agency.
Ram recommended public investment funds for the region to “start mobilising a lot more of your own domestic financing, [and] get your people to also be part of that development through their savings”.
“I think that each of our countries can have what I call a public investment fund. And that fund can initially be financed through some of the foreign exchange reserves that we have,” he suggested.
“Money [would be] put in by our governments . . . encouraging savings by individuals and domestic firms into that public investment fund. And that fund then has the mandate to invest on the country’s behalf, investing in the projects that make sense, but investing in the projects that also provide an economic and financial return for the persons who have placed their money there,” Ram
said.
“I think the time for us to start mobilising more domestic resources with the . . . technical assistance from places like CDB . . . has come, because there is no longer going to be sufficient funds from external sources for us.”
He added: “I know Prime Minister Mia Motley has spoken about it many times. How do we mobilise domestic savings for our development? So instead of perhaps saving our foreign exchange reserves and treasuries . . . overseas, why not take some of those resources and help finance our public investment fund and then crowding other investors into that for our development?”
Ram noted that “over the last few years, my thinking on economic development and certainly on sustainability and resilience has changed tremendously”.
“We are still so vulnerable. Almost every year, one of our countries is hit with some type of catastrophe. And just last week, of course, we saw . . . Jamaicans suffering from that terrible Hurricane Melissa,” he said.
Ram called for a new economic paradigm instead of the existing one which said “rising consumption equals economic growth, and we’re happy with that”.
He also asserted that economists had lost their way because “we don’t focus enough on the human condition, we focus on macro indicators”.
“But what’s really happening on the ground? I think that it’s time for us to focus our sustainability and resilience efforts on the human condition, human well-being, thinking about what sustainable production means for that,” he said.
“Inclusive growth, environmental care, of course, because that’s critical for us and . . . building resilient communities. In my humble opinion, I think that’s the true meaning of economic success for our region.” (SC)
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