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Darcy Boyce

COTED meeting agrees on CCREE full operationalisation

GEORGETOWN, Guyana, Apr 20, CMC – The Special Meeting of the Council for Trade and Economic Development (COTED) on Energy has ended here with an agreement that work has advanced towards the full operationalisation of the Caribbean Centre for Renewable Energy and Energy Efficiency (CCREEE) by the middle of this year.

Minister of State in the Office of the Barbados Prime Minister, Darcy Boyce, who chaired the one-day meeting on Thursday, said “we can then move forward with appointment of the executive board and staffing of the Centre”.

Darcy Boyce
Darcy Boyce

Montserrat became the latest Caribbean Community (CARICOM) country to have deposited its instruments of ratification of the agreement establishing the CCREEE.

Barbados, Dominica, Jamaica and Belize are the other CARICOM countries that have deposited their instruments of ratification.

The Centre is intended to function as the implementation hub for the CARICOM Energy Policy, as well as the Caribbean Sustainable Roadmap and Strategy (C-SERMS). I

n 2015, CARICOM leaders approved the establishment of the CCREEE and identified Barbados as the host country for its Secretariat. The COTED agreed to interim operations of the Centre in January, 2016 and on Thursday, the meeting agreed on decisions related to the transition from that interim stage to the first operational phase.

When fully operational, the Centre is expected to improve the quantity and quality of programmes and projects in sustainable energy within the region.

“We had a very useful meeting, and I expect that we would have put ourselves in a position to achieve a lot more in the energy sector, in renewable energy and energy efficiency over the next few years,’ Boyce said, adding that “good progress” had also been made on the matter of labelling of energy efficient equipment within the region.

He said this step would ensure that people knew “exactly what they were getting” when they bought equipment and sought to encourage them to acquire more efficient equipment and appliances for their properties.

The meeting also approved a pilot programme which will get underway shortly to promote energy efficiency in commercial and residential buildings. Substantial discussions were held on integrating climate resilience into the C-CERMS against the background of the region’s vulnerability to intense climate-related events.

The one-day meeting also discussed insurance and electricity disruption.

“We felt that we needed to discuss ways in which we could get the work done to guide us… to become more resistant to those situations, and to help us to recover faster” when there are natural disasters,” Boyce said.

He said the ministers also took stock of the availability of technical assistance under the CARIFORUM Regional Programme for Energy under the 11th European Development Fund (EDF) to get the resources that were necessary for studies and to implement projects to grow the energy sector.

The ministers also had “robust” discussions on oil and gas in the Region. A working group is to be established to consider how there could be deeper cooperation and more advice available on the technical matters on that sector.

Boyce had at the start of the meeting made reference to the region’s oil and gas sector, and its potential to benefit the populace.

“While we are all determined to make sure that we benefit as best as we can from renewable energy and energy efficiency, we all also have to bear in mind that if we are the owners of resources, we ought not to let those resources stand there idly, but we should use them for the benefit of our countries and for the Region.

“So I am very glad that we are not shying away from the matter of oil and gas. It is a matter of balancing … oil and gas, with the natural resource of sunlight, and wind, and water. And this is what it is all about: optimising, getting the best mix of those resources to give our people and our economies what they need”, he said.

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Paul Collier

Government urged not to invest in oil refinery

GEORGETOWN, Guyana, Mar 24, CMC – An internationally recognised economist is urging the Guyana government not to invest in a local oil refinery noting that refineries attract large amounts of capital expenditure.

“The whole oil industry is going to tether out in 2040. You might be left with a great lump of technology off your shores which has no use,” said Professor of Economics and Public Policy at Oxford University, Sir Paul Collier.

Paul Collier
Sir Paul Collier

Sir Paul, who was here participating in a special high-level Cabinet caucus on the development of the country’s oil and gas industry,  told reporters that the margin on returns for refining oil is very small.

He also advised that the government avoids subsidising gas because “that way the society ends up drinking what it should be accumulating”.

Sir Paul said he is confident that the Guyana government will learn as the oil and gas industry develops, what are the best investments, taking into account the unpredictability of the market.

Minister of State, Joseph Harmon has already stated that the government will take on board all recommendations before making any decision on the establishment of an oil refinery.

“We have to take on board all of the advice that is given and then at the appropriate time the Minister (of Natural Resources) will bring a memorandum to Cabinet upon which we will cogitate and make a decision that is in the best interest of the people of Guyana,” Harmon said.

Last year, Pedro Haas, Director of Advisory Services at Hartree Partners, who was tasked with carrying out a feasibility study for an oil refinery in Guyana, said that the cost to construct an oil refinery would be in the vicinity of five billion US dollars.

The feasibility study found that it would be too costly for the government to invest in an oil refinery.

The consultant, whose services was secured through the New Petroleum Producers Group by the London-based Chatham House, said that the final results of the study showed that Guyana would be “destroying over half the value of your investment the day you commission your refinery”.

 

Further, Sir Paul suggested that the government examines the idea of establishing a national oil company, not to conduct off-shore drilling, but to operate as a minority equity partner to build expertise in the operation.

He said this will better position the Government in decision-making, policies and future engagements with other oil companies seeking to invest in the country’s oil and gas industry.

The British expert re-emphasised the need to have a national conversation on these and other issues to chart a common course forward.

The government said the objective of the caucus was to move preparations to a deeper level of engagement on issues such as prioritizing spending on infrastructure, agriculture and social programmes, inter-generational savings, geo-political considerations, legal and institutional strengthening, benefit sharing and engagement and involvement of the people of Guyana.

It has indicated that similar exercises will be held in the coming months.

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oil spill

PCJ seeks to assure measures being taken to preserve environment as it searches for oil and gas

 
KINGSTON, Jamaica, Mar 21, CMC – The Petroleum Corporation of Jamaica (PCJ) says it is taking all measures to ensure environmental preservation during its search for oil and gas on the island’s south coast.

PCJ’s Oil and Gas Manager, Brian Richardson, told a Jamaica Information Service (JIS) Think Tank that protection of the environment while undertaking its engagements is a pivotal part of the entity’s mandate.

oil spillHe said that the Corporation and its partner in the exploration exercise, Tullow Oil, have been abiding by this in accordance with stipulations from the National Environment and Planning Agency (NEPA), which is monitoring the project.

Richardson said NEPA, as an independent body, “has looked at what Tullow Oil is doing and has seen that they are doing the appropriate work, which is reflected in the international community”.

He noted that two 2D surveys have already been conducted by the companies, and “we have not had any issues.

“We are going to go through it a third time, and I don’t believe we are going to have any issues,” he added.

While pointing out that environmental risk is an ever-present possibility, Richardson said that “the way you manage it is to try and reduce that actively, and we have a company who actively pursues that”.

He said that in addition to the seismic vessel, there will also be smaller scout vessels around to protect fragile marine environment so that the various life forms do not cross the path of the large vessel.

PCJ Manager Corporate Affairs and Communications, Camille Taylor, said the survey vessel will also have marine mammal observers on-board.

She noted that these individuals have the authority to stop the survey if they think there is any risk to marine life, adding that “they will pretty much be directing when and where (things are done), and their top priority will be to preserve marine life”.

Taylor said that “as it is, seismic surveys are non-invasive and they (persons conducting the exercise) tend to be very respectful of marine life.

“The PCJ is taking every precaution, (and) with NEPA and the marine mammals observers on board, it is assured that marine life will not be harmed”.

Oil and gas exploration activities being undertaken by the PCJ and Tullow Oil, which began with an agreement in 2014, will shift into a higher gear with the initiation of the first-ever 3D seismic survey in the waters off Jamaica’s south coast between the Pedro Banks and Portland Cottage this month.

PM says electoral victories in Grenada and Antigua send strong messages

March 23, 2018
186 views
 

ROSEAU, Dominica, Mar 24, CMC – Prime Minister Roosevelt Skerrit Friday said that the “clear and strong mandates’ given to the incumbent governments in Grenada and Antigua and Barbuda should serve them to implement policies geared towards “the re-fashioning and revitalisation” of their respective economies.

Browne skerrit
Prime Minister Gaston Browne (left) and Prime Minister Roosevelt Skerrit (right) with CARICOM Secretary general irwin La Rocque (File Photo)

Speaking on the state-owned DBS radio, Skerrit in extending congratulations to Prime Minister Gaston Browne, whose Antigua and Barbuda Labour Party (ABLP) won 15 of the 17 seats in Wednesday’s general election, said it showed that as in the case of Grenada, the electorate had “evaluated all options and determined it would be better not to tinker or tamper with a formula that is working.

“All may not be well with everyone and for everyone in Antigua, but voters obviously took the picture and broader picture into consideration and stick with the incumbent party,” Skerrit told radio listeners,

“I believe the message we can draw from both the Grenada and Antigua election outcomes is that stability at this time is crucial. If what you have is working for you then it is better…to stay with it.

“These large mandates have given each respective government the opportunity to make hard but needed decisions with respect to the re-fashioning and revitalisation of their respective economies,” Skerrit said, warning that ‘these economies in the English-speaking Caribbean are at a very crucial stage.

“We cannot wish natural disasters away nor can we pretend that there aren’t international forces acting against our very best interest. Therefore governments in the region need a mandate to act and I think both the Grenadian and now the Antigua and Barbuda governments have been given such a strong and clear mandate to bring about needed reforms”.

Prime Minister Dr. Keith Mitchell led his New National party (NNP) to a complete washout of the opposition National Democratic Congress (NDC) in Grenada winning all 15 seats for the second consecutive occasion on March 13 and the third time overall since 1999.

Skerrit said that he was looking forward to working with both governments “in the furtherance of the CARICOM (Caribbean Community) and OECS (Organisation of Eastern Caribbean States) missions and agenda.

“To the losing NDC in Grenada and the UPP (United Progressive Party) in Antigua and Barbuda, I commensurate with Mr. Nazim Burke and Mr. Harold Lovell, I wish their respective organisations the very best wishes in their efforts to re-organise and re-position themselves.”

Skerrit said that in the case of Antigua and Barbuda, where “hundreds” of Dominicans reside, the outcome of the election was important.

“It was important for us that these elections were conducted in atmosphere of free from fear, violence or intimidation. We wish the very best for Antigua, because when Antigua prospers, Dominican families prosper as well”

But as he has said in the past, Skerrit reiterated that opposition parties in the Caribbean were becoming very critical of existing government policies without having developed any meaningful alternatives.

“It speaks to the fact that electorates are really in many instances fed up with the negative rhetoric coming in from political quarters,” he said, including his own country as part of that malaise.

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UAE-Caribbean Renewable Energy Fund launches second funding cycle

UAE-Caribbean Renewable Energy Fund launches second funding cycle

ABU DHABI, 14th January 2018 (WAM) — The UAE-Caribbean Renewable Energy Fund, valued at AED183.6 million (US$50 million), has launched its second funding cycle by establishing partnerships with seven new Caribbean countries, on the sidelines of Abu Dhabi Sustainability Week 2018, with

the aim of promoting its role in developing the renewable energy sector in Belize, the Dominican Republic, Grenada, Guyana, Haiti, Saint Kitts and Nevis, and Saint Lucia.

During the fund’s announcement on the sidelines of 8th session of the International Renewable Energy Agency, IRENA, General Assembly, Dr. Thani bin Ahmed Al Zeyoudi, Minister of Climate Change and Environment, has stated that the UAE has a prominent international role in promoting

renewable energy solutions and finding effective solutions to key challenges facing renewable energy projects and innovations, which is reflected in the availability of necessary funding and investments in the country.

He added that the UAE-Caribbean Renewable Energy Fund, which was launched last year during the Abu Dhabi Sustainability Week 2017 to finance a series of renewable energy projects, is one of the country’s key initiatives to promote relevant global energy solutions.

The announcement on the launch of the fund’s second funding cycle, which will include establishing projects in the nine Caribbean countries and add to existing projects in five countries in the region that were launched during the first funding cycle, highlights the UAE’s commitment to support international efforts related to the global transformation of energy, he further added.

Reem bint Ibrahim Al Hashimy, Minister of State for International Cooperation, said that these new projects, which will help to consolidate the UAE’s relations with Caribbean countries, have promising qualities in terms of decreasing economic costs, limiting environmental pollution, improving the living standards of the people of these countries, and enhancing the services offered to them.

WAM/Hazem Hussein/Hatem Mohamed

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EME press conf DSC_3689

Early Market Engagement of Montserrat’s geothermal energy continues

On Tuesday morning, January 23, 2018, the Hon. Minister of Energy Paul Lewis and his energy team, met and hosted officials from Thermal Energy Partners (TEP) out of the USA and Alquimi Renewables, in an Early Market Engagement (EME) to review the sites, and present an initial proposal for the geothermal project.

They later met members of the press to discuss their vision for supporting Montserrat’s push to run on 100% renewable energy.

Minister Lewis explained, as he reminded that the exercise began since November last year: “…we are proceeding with the Early Market Engagement so that we can capture the necessary technical information, the possible designs and of course maybe most importantly possible financing model going forward.”

Bruce Cutright of TEP said Montserrat was sitting on a gold mine, adding that the tough work had already been done by investing in the exploration of the wells. He said they were interested in offering up to 100% financing for the building and operation of a geothermal power plant. However, Minister Lewis shared that it is important to him that Montserratians have a stake in the project moving forward.

Cutright said: “High prices of energy can stop growth, can limit growth and can make the cost of living for the individual citizens of an area extremely expensive; and conversely if Government of Montserrat develops their energy resources they will cut their price of energy here on the island by at least 50%.”

The well researched Cutright said that although the early assessments have put the output power of Well 1 and 2 at around 3MW he is confident there is much more, which can be the basis for the regeneration of Montserrat’s economy by lowering costs to consumers and attract businesses who need cheaper energy.

“With that kind of inducement in the economy,” he continued, “you’ll see growth in industries wanting to move here, in resorts wanting to move here and the underlying benefit of each individual citizen would be increased tremendously”

He also revealed that TEP is currently a partner with the Nevis Government in its geothermal project. He said TEP is, “excited about submitting a formal response to Early Market Engagement and we hope that we can go forward and really become a partner with the Government of Montserrat.

The geothermal exploration of Wells Mon1 and 2, as well as a third, has been funded by the Department for International Development (DFID).

DFID Infrastructural Advisor Iftikhar Ahmed reported that work on Well 3 which was halted after a partial collapse in 2017 said a new agreement is being completed for the resumption of work at the third site, which he expects will be in the next couple of weeks.

Mr. Indranil Ahmed (newly appointed Infrastructure Advisor for Montserrat, St Helena and Tristan da Cunha for of DFID) also indicted that the Mon3 well is not critical to developing geothermal energy in Montserrat. However there is an intent to use one well for reinjection of fluids after heat has been extracted to generate electricity. DFID is committed to the development of three wells, including rehabilitation of the third well, which is now at 2.4 km depth.

DFID’s focus going forward is on a public-private partnership engagement towards successfully developing Montserrat’s geothermal resource, as the current plan does not involve DFID funding the development of a power plant. But, they will maintain their commitment to the short and long-term testing of the resource.

This is the second EME visiting event that the Government of Montserrat has done for the generation of geothermal power.

Late last year, Exergy was the first company to have participated in the initiative. Minister Lewis revealed that a potential six companies in total have expressed interest, informing that  the Government of Montserrat is exploring the possibility through expressions of interest of concretizing a public private partnership going forward there are a total of six companies have indicated an interest in bidding on the project.

(See related on the Geothermal development – “gold mine” here https://www.themontserratreporter.com/montserrats-geothermal-energy-gold-mine/)

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EME press conf DSC_3689

Montserrat’s Geothermal Energy “gold mine”?

Thermal Energy Partners of Texas suggests that Montserrat’s accessible geothermal energy resource is potentially 100 million watts

Geothermal energy for Montserrat is not just for the sake of renewable energy, (going green) unless it is the ‘game changer’ it has been touted to be. Hence the question, of significance now.

by GEM

BRADES – As the Government of Montserrat continues its “early market engagement” [EME] for geothermal energy development, on Tuesday January 23rd, it met with Mr Bruce L Cutright[1] of Thermal Energy Partners[2] [TEP], a Texas-based firm that is working to develop Nevis’ Geothermal energy resource. During the press conference held at the Ministry of Public Works, Mr Cutwright suggested that – given the temperature and fluid flow characteristics of Wells Mon 1 and Mon 2 – Montserrat may have up to 100 Million Watts of accessible geothermal energy. He also suggested that US Government research laboratory data indicates that costs for electricity could be reduced up to thirty to fifty (30 – 50) percent.

TEP is therefore offering itself as a potential partner for developing geothermal power in Montserrat on a public-private partnership, commercial basis.

An initial development would be likely to be 3 – 5 million watts. (Montserrat’s current peak electrical load is a bit over 2 million watts.)

When Mr. Cutwright was asked by TMR about the suggested potential reduction in cost of electricity, he explained that based on US Department of Energy [DoE] data, geothermal electricity is commonly produced at a “levellised cost” of US$ 0.05 – 0.12 per kWh [kilowatt hour]. He then suggested that our current costs to produce electricity are about US$ 0.38 – 0.55 per kWh. He further suggested that the reduction in cost to produce electrical energy could then lead to moving the price from about US$ 0.45 – 0.50 per kWh to possibly US$ 0.25 per kWh, hence reduction by a third to a half. However, TMR notes that specific, “hard” numbers will depend on the particular design of the plant to be developed and on various linked financial decisions. Transparency about the process is in the public interest.

Mr. Cutright also indicated that in neighbouring Nevis, TEP has helped to identify a geothermal resource of 100 – 400 million watts and is working with the Government of Nevis in a partnership to develop geothermal energy there. (Official sources there suggest 300 million watts and there are indications that some estimates are as high as 650 million watts.) The proposed initial plant size there is to be 9 million watts.  For Nevis, Mr. Cutright indicated that there is a contract to provide electricity at US$ 0.19 per kWh, of which the Government of Nevis gets US$ 0.025 – 0.030.

Encouraged by developments in Nevis, the Government of St Kitts-Nevis is also looking to develop identified resources in St Kitts and to explore interconnectivity with Nevis as well as possibilities for export.[3] Such export will require undersea power cables, which will therefore be within a few dozen miles of Montserrat.

A September 3rd 2016 Carib Journal article[4] indicates that the Government of Antigua and Barbuda has also signed a memorandum of agreement with TEP towards developing a Organic Rankine Cycle geothermal plant with ten million watts of capacity.

In a related development, Mr. Indranil Ahmed (newly appointed Infrastructure Advisor for Montserrat, St Helena and Tristan da Cunha for of DFID) has indicted that the Mon3 well is not critical to developing geothermal energy in Montserrat. However there is an intent to use one well for reinjection of fluids after heat has been extracted to generate electricity. DFID is committed to the development of three wells, including rehabilitation of the third well, which is now at 2.4 km depth.

 

DFID’s focus going forward is on a public-private partnership engagement towards successfully developing Montserrat’s geothermal resource.

[1]     See: http://www.thermalep.com/leadership

[2]     See: http://www.thermalep.com/about-thermal-energy-partners

[3]     See: http://newenergyevents.com/st-kitts-finalizing-geothermal-agreement-will-explore-interconnect-to-nevis/

[4]     See: https://www.caribjournal.com/2016/09/03/antigua-barbuda-develop-geothermal-energy/#

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Guyana venezuela border

ExxonMobil offers financial assistance to settle border controversy – report

GEORGETOWN, Guyana, Dec. 3, CMC – The government of Guyana could be getting help from US oil giant ExxonMobil, in its efforts to have a judicial settlement of the border controversy with Venezuela.

According to News Source Guyana, Government sources have reported that the company has set aside just under US$20 million to assist Guyana with legal fees and other costs that could be incurred once Guyana moves to have the judicial settlement of the border controversy.

Guyana venezuela border“Our national sovereignty is riding on this issue and it will be remiss of us if we are not prepared and all resources are not put in place. The actual amount is more than GUY$15 million but less than GUY$20 million. This is not the first time we are going this route as it was done with the CGX Energy and Suriname after the June 2000 incident with the Surinamese coastguard. The PPP was then in office. This is nothing new. This is not a signing bonus, but rather we are garnering the resources to prepare for the case. This is a sovereignty issue,” the source was quoted as saying.

Venezuela contends that the Arbitral Award of 3 October 1899 demarcating the border between Guyana (British Guiana at the time) and Venezuela is null and void. Consequently, it continues to lay claim to two-thirds of Guyana’s territory.

In 2015, the Guyana government requested the United Nations Secretary-General to take steps toward a resolution of the controversy using an option from the menu as stated in the Geneva Agreement of February 17, 1966.

Further, last year, as a consequence of a stalemate on the matter, outgoing United Nations Secretary-General Ban Ki-moon agreed with his successor,  António Guterres, to continue to use the Good Offices Process until the end of 2017 as a means of arriving at a settlement.

According to the mandate of the Personal Representative, “If, by the end of 2017, the Secretary-General concludes that no significant progress has been made toward arriving at a full agreement for the solution of the controversy, he will choose the International Court of Justice as the next means of settlement, unless the Governments of Guyana and Venezuela jointly request that he refrain from doing so.”

The government statement said that since his appointment on 27 February this year, Nylander has visited Guyana on four occasions holding talks with President David Granger and Greenidge, among others.

In September, the Guyana delegation to the United Nations General Assembly met with the Secretary-General as well as Nylander and held informal discussions with Venezuelan counterparts.

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IMF Andrew

IMF pledges support for Caribbean

KINGSTON, Jamaica, Nov 16, CMC – The International Monetary Fund (IMF) Thursday pledged its support for the Caribbean as the region moves to build resilience against the effects of natural disasters.

IMF managing director, Christine Lagarde, addressing the sixth IMF High level Caribbean forum, said the Washington-based financial institution is prepared to support the Caribbean with recovery funding and is cognisant of the impact of natural disasters on economic development and stability in the Caribbean.

IMF Andrew
Jamaica’s Prime Minuster Andrew Holness in discussions
with IMF managing director, Christine Lagarde

She told the forum, which is being held under the theme ‘Unleashing Growth and Strengthening Resilience in the Caribbean’, that the IMF is ready to provide leadership with sourcing special funding and expertise to assist the region in developing mitigation and resilience strategies over the short and long term.

She said Hurricanes Irma and Maria that passed through the Lesser Antilles in September causing widespread destruction and killing several people “have again highlighted the special vulnerabilities of the Caribbean, and the need to strengthen its resilience.

“Climate change is expected to intensify the impact of natural disasters, and worsen the vulnerabilities of small states in the Caribbean. Rising sea levels increase risks of erosion and flooding, and warmer water temperatures heighten the potential for more intense hurricanes,” she told the forum that is being attended by several regional prime ministers, central bank governors and other stakeholders.

“We must come together to address the challenge posed by climate change, and help those most affected by it. Emergency relief following events like Hurricanes Irma and Maria is a key responsibility of the global community.”

Lagarde said that the IMF stands ready to do whatever it can to help in these situations, in assessing macroeconomic implications, determining financing needs, and providing financial support that would also help catalyze broader financing from the rest of the international community.

“Beyond these efforts, I propose convening an event with all the major public and private stakeholders to explore options for building resilience in the region, including risk mitigation, debt management strategies, and use of catastrophe bonds. This effort is not about a short-term response, but about building defenses to events that will reoccur again.

“In this effort, we will work in close collaboration with our Caribbean partners and the World Bank, the Inter-American Development Bank, the Caribbean Development Bank, and other development partners.”

She said that the forum, which focuses on issues impacting the region and the potential opportunities within the context of an ever-changing global landscape, is an important platform for brainstorming and collaborating with key stakeholders on the challenges facing the region and the possible solutions to address them.

The IMF has just published a book by the same title as the theme of the forum and the IMF managing director said it which explores some of the ideas to be raised.

“This year’s Forum is also about hearing your views on how we can work together to deepen Caribbean growth, insulate it more from shocks, and make it more resilient. We all want this region to create more jobs and growth for the benefits of its current and future generations.

The IMF official said stronger economic growth is the essential foundation for a more resilient Caribbean and it is also a foundation for building defenses.

“Unfortunately, economic growth in the Caribbean has been low for several decades. This has led to rising social and economic challenges, including poverty, inequality, unemployment, and crime. While many authorities in the Caribbean were successful in their efforts to create a stable macroeconomic environment, growth still remains elusive.”

Lagarde said there is no one explanation for this disappointing growth performance. Caribbean economies have been hit by external shocks, such as natural disasters which affected agriculture in particular and loss of international trade preferences.

She said at the same time, they have not been able to fully insulate themselves from such shocks because of large macroeconomic imbalances. Growth has also been affected by structural impediments.

“A few come to mind: The region’s high cost of electricity, limited access to credit for households and medium and small enterprises, high rates of violent crime, and a persistent outflow of highly-skilled workers, the brain drain.

“So what can we do moving forward? That is what brings us together…This conference has been organized to discuss these issues. The IMF is not a specialist on these topics, and this conference will afford us an opportunity to learn.”

She said that the agenda covers three specific issues that are key to higher growth, namely crime and youth unemployment; fiscal policy and political cycles; and stability and growth trade-offs in the financial sector.

The IMF official said that crime and youth unemployment in the Caribbean is among the highest in the world. Crime, partly fuelled by this high rate of joblessness, a major obstacle to growth in the Caribbean.

She said crime imposes several economic costs, including public spending on security and the criminal justice system; private spending on security; and social costs from the loss of income due to victimization and incarceration.

In a recent study, the Inter-American Development Bank (IDB) found that, on average, crime in the Caribbean costs nearly four per cent of gross domestic product (GDP) annually, more than in most Latin American countries.

“So we need to create a virtuous cycle, where strong growth would reduce high unemployment and in particular high youth unemployment and crime which, in turn, would contribute to boosting productivity and growth, without which investors are reluctant to invest. “

But Lagrade said this “can only take us so far” and that politics and electoral cycles can have a strong impact on fiscal policies and economic outcomes, a phenomenon that has been observed around the world, and has also played a major role in shaping economic developments in the Caribbean.

She said too often, promising reforms have been cut short by policy reversals driven by political pressures, not in all cases, but in many instances.

“We need strong institutions and fiscal frameworks that can help safeguard and sustain prudent fiscal policy over time.

“For example, well-designed fiscal rules can help guide consolidation efforts. Indeed, such a rule targeting a reduction in public debt to 60 percent of GDP over the medium term has been introduced in several countries in the region—the Eastern Caribbean Currency Union—and has had success in putting public debt on a clear downward path in St. Kitts and Nevis, Grenada, and Jamaica.”

Lagarde said that the experience of these countries, which in the main has been very successful, provides a good example for other countries in the region.

She said fiscal councils are also increasingly recognized as tools to promote sound fiscal policies by providing independent information and analysis, and by monitoring compliance with fiscal rules.

She said Jamaica’s Economic Program Oversight Committee (EPOC) provides a good example.

“From 2013 onwards, this public-private sector committee has played a central role in monitoring Jamaica’s economic reform program and building support for it. While some had doubts whether the government’s program would work, through the authorities efforts including building support, the program succeeded.”

In her address the IMF managing director said that there is need to consider the connection between financial stability and growth.

“We know that a well-functioning and healthy financial sector should strike a balance between risk-taking, growth, and stability. But we also know that the financial sectors in the Caribbean have historically either taken on too much or too little risk.”

She said in countries with high public debt, banks have grown dependent on government paper, and have crowded out private sector credit.

In other countries, at times, banks have engaged in excessively risky lending, leading to struggles with nonperforming loans.

“What is the right balance? That will be the focus of a part of our conversation today. The distinguished panel has also been asked to examine policies to address constraints on financial sector inclusion and deepening—and I am very much looking forward to hearing its views,” she told the ceremony.

She said when it comes to banking, there is another challenge that needs to be looked at, noting that both Caribbean and other economies around the world have had to contend with the loss of correspondent banking relationships (CBRs), also known as de-risking.

The IMF, Lagarde said, has facilitated an international dialogue on this issue, aimed at fostering a shared understanding of the problem, and to help develop policy responses that are tailored to specific challenges faced by Caribbean economies.

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Anguilla Electricity company

CDB approves funds for electricity system upgrade in Anguilla

BRIDGETOWN, Barbados, Jul. 25, CMC  – The Caribbean Development Bank (CDB) has approved a loan of US$6.2 million  to the Anguilla Electricity Company (ANGLEC) to meet the growing electricity demand on the island.

Anguilla Electricity companyThe Seventh Power Project aims to improve the capacity and reliability of ANGLEC’s power-generating system.

“This Project will allow ANGLEC to provide a reliable and quality supply of electricity for its customers. This additional capacity is especially critical in light of Anguilla’s dependence on the tourism sector, the sustainability and growth of which is closely linked to electricity supply,” said  L. O’Reilly Lewis, the Division Chief of Economic Infrastructure Division at the CDB.

The Project will comprise the extension of the existing building at the Corito Power Station to accommodate two additional engines, and the installation of 5.1 MW diesel and/or propane generating plant. In addition to financing from CDB, the initiative will be supported by a contribution of USD2.8 million from ANGLEC.

Between 2001 and 2011, Anguilla experienced a 12.8 percent increase in population, with an associated 1,148 increase in the number of households. This, coupled with the continuous growth in demand for electricity and the retirement of several aging diesel sets at the Corito Power Station over the next three years, has resulted in the need for additional generating capacity to meet anticipated peak demand.

The Project aligns with Bank’s Strategic Plan 2015-2019 and Energy Sector Policy and Strategy in which it highlights promoting infrastructure to provide an affordable, clean, sustainable and reliable energy supply.

The initiative also supports the Government of Anguilla’s progress on achieving Sustainable Development Goal 7, which is to ensure access to affordable, reliable, sustainable and modern energy for all.

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