On Tuesday, January 28, at 8.00 p.m. The Hon. Sir K. Dwight Venner, via video conference and radio broadcast, presented his 2013 Eastern Caribbean Currency Union (ECCU) Economic Review.

The ECCB bank Governor issued the report under the theme – Realism and Hope: Moving towards our Development Goals, which he began by expressing “heartfelt sympathies to the people of St. Vincent and the Grenadines, St. Lucia and Commonwealth of Dominica, who were unfortunately affected by severe weather during the Christmas season. Our thoughts are particularly with the families who have lost loved ones or suffered injuries.”

He noted that the monetary cost of the damage, as a percentage of GDP, is tremendous, and, “comes at a time when the countries can least afford it.”

Overall, he said member states are still grappling with low economic growth, persistent fiscal deficits, rising debt levels, high unemployment and poverty rates.

The Governor’s report on the Economic Developments in 2013 was brief, as he moved on to speak of the main challenges and accomplishments; the top priorities in the near to medium term, pointing to the State, the private and the financial sectors.

He said there were three possible scenarios which confront the Currency Union which will weigh heavily on the decisions taken.

The global economy remains in its relatively low growth, high unemployment mode, particularly in our main trading partners while the ECCU countries continue with their current policies;

2. Economic activity in the global economy does not return to its pre-crisis levels while the ECCU makes significant policy adjustments; and

3. The global economy goes through substantial restructuring and rebalancing and the ECCU undergoes significant socioeconomic transformation.

Then to the top priorities, in the medium term for the region. Maintaining a stable currency by implementing policies and programmes aimed at high, sustained and balanced economic growth and development; continuing efforts at prudent debt management and fiscal reform; and enhancing the resilience of the financial system.

He spoke of the new Economic Union Treaty which gives the framework within which, “we can successfully address our fundamental challenges. However, there is an increased urgency for implementation, given the obvious and glaring vulnerabilities we have recently experienced through the global crisis and the disastrous rain storms. Indeed, with respect to natural disasters, the uncomfortable reality is that they are now almost predictable. The only thing that is unpredictable is which country they will hit and when!” he said.

The new arrangement he said, “allows us to contemplate a new economic model in the OECS based on the following premises:

Aggregation of resources; coordination of policies; increase in the quantity, quality, and competitiveness of production and output.”

He added: “Three agents, the state or government, the private sector and the financial sector, are vital to the success of this model.

He outlined the role of government:  to provide an efficient and effective system of justice, law and order; provide critical public services in health, education and social welfare; regulate the economy; and actively promote economic growth and development that is equitable and sustainable.

Defining the role of the private sector, he might as well have singled out Montserrat, when he said, among other things: There must be a systematic programme for the development of a viable and innovative private sector in our countries. Without this most of our important business enterprises in the traditional sectors will be sold off to regional or foreign interests, others will cease operations as the founders pass from the scene; and the current age of internet buying will finish off the rest.

Then: “The private sector itself should be organised and represented at the sectorial level, for example agriculture; and at the national and the OECS levels. This organisational system and structure should facilitate the development of industry sectors through – better representation for interfacing with governments and other important institutions – nationally, regionally and internationally;

research activities to facilitate effective advocacy, product improvement and marketing; and the provision of technical assistance to the sector as a whole.

As did much of the discussion that followed the Governor’s presentation, was the role of the private sector. The Governor answered questions, made his suggestions and offered challenges.

All the OECS were represented at the video conference hosted as usual here at the Agency office. Montserrat showed some interest in the banking sector, while also noting the change in the Governor’s address, asking if the conversation he highlighted last year had begun.

photo caption: Montserrat participants at Agency office during video conference presentation of ECCU Economic Review