The time has come for the Caribbean Development Bank to show leadership in the de-risking challenge facing its borrowing member countries in the region.
Jamaica National Building Society (JNBS) general manager, Earl Jarrett, gave that advice to the bank’s leadership recently during a luncheon linked to the CDB’s 46th annual general meeting in Montego Bay.
Jarrett said the Barbados-based financial institution should play a leading role in crafting the region’s response to the growing crisis, which has led to the loss of correspondent banking relationships for some regional financial institutions.
The Caribbean has been the worst affected by the issue, as the World Bank and regional researchers, the Caribbean Policy Research Institute, have pointed out in recent studies of the issue, which threatens to cut off the Caribbean’s access to the global financial system.
In a November 2015 survey, the World Bank said about 75 per cent of international banks have experienced a reduction in correspondent banking services with the Caribbean being the worst affected.
Jarrett said the CDB should see the issue as a key part of its responsibility to the development of its borrowing member countries.
“As the CDB considers its mandate and growth at this annual meeting, it must also deeply reflect in the economic progress of its member states. It must determine if there is need to adjust its sails in this world of uncertain winds, to ensure its member states that benefit from its primary services are growing, at least, at relatively the same rate as the organisation,” he said.
He noted that the CDB’s assets had grown since establishment in 1969 from $50 million to US$900 million, while the economies of member countries, such as Jamaica, had barely grown two per cent since its independence from Britain in 1962.