2006 a challenging year, says Sir Dwight

Governor of the Eastern Caribbean Central Bank, Sir Dwight Venner has predicted that the year 2006 will be one of the most defining periods in the lives of the people of the Eastern Caribbean region.

The Central Bank Governor expressed this view during the Eastern Caribbean Currency Union Economic Review 2005, aired last week Thursday throughout the Eastern Caribbean. He is of this opinion because of the wide variety and great intensity of challenges the region will face as small states in a rapidly changing regional and international environment.{{more}}

Sir Dwight alluded to recent circumstances, most notably the negotiations on access for our bananas into the European Union, which clearly indicate that the small size of the Eastern Caribbean islands do not evoke much sympathy in international economic relations.

Sir Dwight warned that well-recognised challenges, among them, faster-than-anticipated erosion of preferential trade access arrangements, would have a major impact on the future prospects of our economies.

“This should make it abundantly clear to us that we need to proceed into the future with an increased sense of realism, objectivity and clarity,” he advised.

“The Caribbean Single Market and Economy (CSME) will in all probability come into existence during the course of the year. This arrangement will pose a major challenge for the OECS countries as deeper forms of integration are proposed, which will require substantial structural and institutional changes at the political and economic levels for their successful participation.”

These events, he said, will take place against the backdrop of a world economy, which experienced significant growth in 2005 and will by all accounts continue to do so in 2006.

Sir Dwight noted that while we anticipate a thriving global economy, locally there are significant economic and social challenges which our countries will have to confront.

“Increased levels of crime and violence, the apparent state of social alienation of the young male population, higher levels of drug use and abuse and higher levels of HIV/AIDS infection,” Sir Dwight pinpointed as critical concerns.

The Central Bank Governor noted that with respect to the economic issues, the New Year finds a number of our countries facing major challenges.

Dominica, he said, is working with an International Monetary Fund (IMF) programme in response to a severe fiscal crisis, Grenada recovering from the devastation of hurricane Ivan, while Antigua and Barbuda is restructuring its public finances.

“Fiscal and debt imbalances due to the high per capita cost of government, small populations, inelastic tax systems and the excessive demands placed on governments in liberal democratic systems with competitive party politics,” were some of the more pertinent issues Sir Dwight highlighted as damaging to all countries in the Currency Union.