ST GEORGE'S–Former Barbados prime minister Owen Arthur says the resilience of Caribbean people rather than the content of programmes with the International Monetary Fund (IMF) is what will likely determine whether regional countries succeed or fail.
Arthur, delivering the Sir Archibald Need Memorial lecture on Thursday night, said the new type IMF programmes will "not in and of themselves solve all the problems of the Caribbean."
"At best, they will function as catalysts which can trigger access to additional resources and help to generate new policy responses from others that all together may help to make a situation which started as being unsustainable, come into the realm of being manageable," Owen said, as he spoke on the theme Can the Prescriptions of the IMF solve the economic problems of the Caribbean?.
He said countries facing such a "brutal reality must draw therefore upon more than what the IMF provides for."
"Indeed, the totality of the adjustment that will be required to solve the problems will be the sum of those undertaken by the government in response to the national challenges, those undertaken by enterprises to improve and reform their balance sheets, and those undertaken by the people to ensure that they can enjoy successful livelihoods," he said.
The Arthur said the contemporary Caribbean does not face the best of circumstances nor does it enjoy good fortune.
He said the longstanding and often cited difficulties that are associated with and derive from the region's dubious distinction as the world's smallest and most vulnerable set of nations, have persisted and have become more pronounced.
"In addition to its long standing challenges, our region, now has to grapple with stresses which are of a more recent vintage, which are gathering in scope and intensity and which are now so massive as not to lend themselves to easy resolution," Arthur said.
He said the typical Caribbean country now faces the real danger of having to rely for their material progress on economic systems that are not viable.
"Conditioned for centuries to depending upon preferential access to foreign markets for their exports, on high levels of domestic protection for their industries and on generous access to concessional financing to support their development, almost every Caribbean nation has, now to face the prospect of building economic systems without the benefit of such props. "
Arthur said all the evidence suggests that the transition from the age of preferences to the age of competitive self-reliance has had devastating consequences, as is evidenced in the case of every banana producing economy.
"Our region has also been more adversely affected than most other regions, though unintentionally, by the economic rise of the South, especially China and India," he said, adding "for much of the capital that our region used to attract to build for manufacturing and our informatics industries has been diverted to those nations, as they have embraced liberalization as their dominant economic ideology."
"Ideally, therefore, the fiscal consolidation programme should go hand in hand with the growth programme," Arthur said. CMC