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Caribbean forced to consider ‘lost decade’

Caribbean forced to consider ‘lost decade’


The continuing effect of the global financial meltdown is forcing the Caribbean “to contemplate the implications of a potential ‘lost decade’ of development,” Prime Minister Dr Ralph Gonsalves told the United Nations Friday.{{more}}

“Our region is not immune from the economic pressures and fissures that have turned other parts of the world into tinderboxes of social unrest and political upheaval,” Gonsalves told world leaders.

He said Caribbean nationals have “nobly struggled under the weight of externally-sourced contraction, austerity and hardship” but “are not possessed of limitless patience or endurance.

“Our hard-won developmental gains are in jeopardy, and our settled political stability is in possible peril.”

He told the General Debate of the 67th Session of the United Nations General Assembly that the international community “cannot ignore our plight based on a distorted calculus of middle-class status and relative prosperity, or on simplistic, even offensive, stereotypes of peaceful Caribbean paradises”.

He noted that the Caribbean is vulnerable to natural disasters and international economic convulsions.

Gonsalves told the gathering in New York that small, highly-indebted middle-income developing countries — like those in the Caribbean — have especial concerns that the international community is obliged to partner in addressing properly.

The modern circumstances and individual national characteristics “do not lend themselves to classical or Keynesian economic prescriptions or their variants,” he said.

Keynesian economists believe that aggregate demand (total spending capacity in the economy) does not necessarily equal aggregate supply (the total productive capacity of the economy).

They say that aggregate demand is influenced by a host of factors and sometimes behaves erratically, affecting production, employment and inflation.

Gonsalves noted the “peculiarities of size, openness and vulnerability” of St Vincent and the Grenadines (SVG) and its Caribbean neighbours and said the nations “require uniquely home-grown economic policies that are rooted not in any prevailing ideology or fashionable theories from outside; but a sensible, flexible and focused practicality.

“We have little interest in esoteric arguments about the role of the State in economic activity, because, historically, our national governments have been a force for good in the stimulation, diversification and growth of our economies in tandem with the private and cooperative sectors,” he said.

While the Caribbean welcomes and solicit help and consultation with relevant institutions and organisations, Gonsalves said, “such consultations must be free of the type of textbook orthodoxies or formulaic prescriptions that are inapplicable to our times and circumstances.

“Our path to development must be our own,” he added.

He said the cause of development has suffered from “the wilful neglect of the international community in recent, post-crisis years”.

The current UN budget for peacekeeping, he further told world leaders, “dwarfs the resources allocated to fostering development, even as we recognise that most conflict is rooted in underdevelopment”.

Development goals fears

Gonsalves further expressed fears that given the present situation, the Millennium Development Goals (MDGs), “will not be met across large swaths of our planet”.

The eight MDGs range from halving extreme poverty to halting the spread of HIV/AIDS and providing universal primary education, all by the target date of 2015.

“The poor especially in Asia, Africa, Latin America and the Caribbean can hardly be expected to wait any longer,” Gonsalves said.

He said SVG is thankful to the nations and organisations that “have found it possible to continue extending their hand in cooperation with our people, even in difficult economic times”.

The International Monetary Fund (IMF) said in its World Economic Outlook Update that in the three months ending June 2012, “the global recovery, which was not strong to start with, has shown signs of further weakness”.

“Growth in a number of major emerging market economies has been lower than forecast,” the IMF further said.

UN chief’s reassurance

Gonsalves’ comments on Friday came one day after UN Secretary-General Ban Ki-moon reiterated UN commitment to help Caribbean countries tackle some of the most pressing issues

in the region, including climate change, organized crime and debt.

“I attach great importance to regional cooperation among States and between regional organizations and the United Nations,” Ban told the heads of Government of the 15-member Caribbean Community (CARICOM), the UN said in a release.

“CARICOM and the United Nations are good partners. I am committed to ensuring that our cooperation — both with the CARICOM Secretariat and with member states — is more targeted and more responsive to the needs of the region,” Ban further said.

He said he would continue to call on members of the group of eight largest world economies to fulfil their pledges to maintain international

aid, to help Caribbean countries whose growth has been weakened by high levels of debt and barriers to trade, the release further said.