LAST WEEK, the director of the Western Hemisphere Department of the International Monetary Fund announced that the economic growth forecast for the Caribbean and Latin American countries for 2015 has been re-adjusted downwards to just 1.25 per cent, nearly one percentage point below the earlier forecast.
Once more, the lower forecast is linked to external factors, including changes in the prices of various commodities such as oil and food on the global market.
Despite this reduced forecast, a certain degree of optimism still remains in relation to the future prospects for those economies.
Indeed, according to the director, “boosting growth prospects and sustaining poverty reduction in a more challenging external environment will require determined efforts to improve the business environment, raise productivity, and increase saving and investment. It’s not too late yet for good New Year’s resolutions”.
Clearly, what is emerging from those sentiments is the message that even within the context of a hostile global environment, which no doubt has the potential to limit the growth prospects of highly-open and vulnerable economies like those in the Caribbean, individuals charged with the responsibility of managing our economies can still make a difference by refocusing domestic policies to issues that are certainly growth-enhancing.
But in a broader context, what it all means is that in order to create conditions that can propel Caribbean economies to the next level of economic performances, serious efforts must be made to re-configure the various elements of the models of economic growth and development that we embrace and seek to implement from time to time.
In so doing, we have to make value judgements as to what has, and can, work in our favour as well as figure out some of the things that continue to limit our potential to advance as economic powers.
These considerations lead us directly to the critical issue of which Caribbean do we wish to advance to maximise our economic growth and development potential?
For example, as Caribbean countries, do we wish to go forward with big governments, large fiscal deficits and public debt, rising crimes and other social challenges, high unemployment, poor business culture and practices, low productivity in private and public enterprises, and economies that are solely dependent on one or a few major commodities or sectors?
Or alternatively, do we wish to redirect our economic strategies along the lines of smaller governments, healthier business environments to foster private sector growth and development, diversified economies, improvements in productivity, higher saving and investment, lower crimes and other social difficulties, greater personal responsibilities, and generally more economic freedom?
In short, going forward, we as Caribbean people do have serious choices to make if we want to ensure that our economies can continue to grow and develop well into the future in a sustained manner.
The challenges posed by external forces will always be there. Hence, what we do in terms of domestic policies and strategies will go a long way in determining our economic fortunes.
Are we prepared to make the required changes?
Email: [email protected]
