In Turkey, where meetings of the IMF and the World Bank were held during the week of October 4th, Caribbean Finance Ministers raised with the First Deputy Managing Director of the International Monetary Fund, John Lipsky, their concerns about “the need for better representation and participation of small, developing countries in key meetings and fora such as the G20, where decisions that can significantly impact these small economies are frequently made”.

But, Caribbean representation in the already overcrowded G20 will not happen without a strong case being made and accepted by governments currently at the table.
Similarly, much needed reform of the IMF and World Bank to benefit the Caribbean appears remote.

At the Bank/Fund meetings, the President of Guyana, Bharrat Jagdeo, as current Chairman of CARICOM, led a team of Prime Ministers from the Bahamas, Barbados and St Lucia to make a case to the President of the World Bank, Robert Zoellick, that special attention should be paid to relieving and restructuring the debt of the highly indebted, vulnerable, middle income countries of the region.

And, Barbados Prime Minister, David Thompson, speaking at the formal meeting was emphatic that “limited access to World Bank funding has forced many middle income Caribbean countries to borrow in the private capital markets at substantially higher rates and shorter repayment terms”. Mr. Thompson recommended that “further consideration be given to this issue of access by middle income countries to financing from the multilateral financial institutions.”

All of this is right. The entire Caribbean region is facing a serious reversal of its economic and social progress arising from a number of factors. It is true that one of the significant factors is poor economic management and decision-making by some of their governments, and this is a concern that Caribbean countries must themselves address.
The external factors are also real. Not least among them is the point raised by both Jagdeo and Thompson that the classification of Caribbean states as middle-income countries disqualifies them from concessionary financing from the international financial institutions and forces them into the commercial market for borrowing.

But, is anyone really listening? The moment for effective reform of international institutions is fast receding. Those industrialised nations that pledged themselves to reform in the wake of last year’s financial crisis are quickly retreating from their pledges as their economies begin to pick-up. The creation of the G20 and the provision of some additional resources to the IMF appear now to be the most they will do.

The new resources for the IMF are insufficient and, in any case, are not targeted to middle income countries such as those in the Caribbean; they are focused on low income countries and on bigger countries such as those in Europe and Mexico.

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