UNITED NATIONS May 18, CMC – Trinidad and Tobago Friday said Caribbean Community (CARICOM) countries were adopting a new paradigm as it relates to socio-economic development in light of the ongoing global; economic and financial crisis.
Prime Minister Kamla Persad Bissessar, addressing the special United Nations conference on the state of the world economy, said the regional countries were moving away from development dependent on external sources to one of Caribbean convergence where endogenous growth must be the real driver of Caribbean development
“We are beginning to witness, however modest, some success as a result of this new approach to development. The Caribbean is projected to grow by approximately three per cent in 2012, after expanding by an average of 1.7 per cent during the first half of 2011.
“In the case of Trinidad and Tobago, my government remains steadfast in its mission to address lingering financial vulnerabilities and to refocus our efforts on promoting growth and diversification. These policies have had some positive effects and the IMF (International Monetary Fund) has noted that economic recovery in 2012 came after an extended slowdown lasting three years,” she said.
The Prime Minister said that the prospects for global economic recovery have been “increasingly overshadowed by myriad downside risks.
“In the face of these risks, the United Nations must not abdicate its responsibility, to forge common positions and devise ways geared to improving the global economic and financial situation which has impacted very negatively on development and resulted in dire social consequences for our peoples. If we are successful in our endeavours, we may avoid a second major crisis.”
She said there is also a real risk that the present global fragility could impact on small peripheral economies and other developing countries that were able to withstand the initial impact of the crisis due to strong domestic economic buffers. “ However, it is likely that these countries may not be able to withstand a second shock of similar magnitude having not as yet attained pre-crisis economic strength.”
She told the world forum that the global outlook is not very promising with the IMF projecting that global economic growth will decrease from approximately four per cent in 2011 to about 3.5 per cent this year “because of weak activity during the second half of 2011 and the first half of 2012.
“This unflattering picture makes it imperative that we embrace new approaches to development to replace those which have created underdevelopment and persistent poverty in many countries,” she said, adding that “home grown solutions must assume major importance if we are to achieve long-term successes”.
The Trinidad and Tobago Prime Minister praised the inclusion of the international financial institutions in at the conference, noting “we now have an opportunity, as States, to engage in open and frank discourse with these Washington-based institutions and to impress upon them the need for small States such as Trinidad and Tobago, to have a greater voice in their operations.
“I submit that this would lead to greater transparency and an increase in the credibility of these bodies,” she said, noting that the economic recession impacting on many European capitals and the current crisis within the Eurozone reverberates around the world.
She said that economic models have to treat with the social and political climate of the day, adding “it is clear that there is a need for more discussion on the different paths to economic growth and it should not be treated as a mantra. We need to think outside the box.
“We in the developing countries are asked to slavishly follow the economic policies dictated in the north without due regard for our particular economic and social circumstances. It is now time that we are all allowed greater participation at the table with our views, ideas and special experiences.
“We have to forge a new economic paradigm that adequately caters for our interests also. It cannot be business as usual,” she said, adding that in many of the developed nations, debt ratios are at historic highs and rising, borrowing requirements remain very large, financial markets continue to be in a state of uncertainty, and downside risks to the global economy exist.
“Developing countries face particular risks as many depend on commodities and primary sectors. We do not have convertible currencies so we are price takers who suffer from the vagaries of the currency exchange movements of our major trading partners. Our productive sectors have been traditionally focused externally with the result that we are at the mercy of external forces. “
Prime Minister Persad Bissessar said that fiscal policy has to support and complement other economic and financial and that the long term solution to debt management “is the achievement of economic growth in our economies and the full employment of all available productive factors of production”.
