CARICOM to present united position to multilateral institutions in September

A special Caribbean Community (CARICOM) task force on the global economic crisis has ended a meeting in Jamaica with an agreement on a united position to present to the heads of the international multilateral institutions in September.

Guyanese President Bharrat Jagdeo, who chairs the task force, told reporters most CARICOM states have indicated that over the coming months they will be seeking some form of assistance with institutions such as the International Monetary Fund (IMF).

The one-day meeting was attended by Jagdeo, who is also CARICOM Chairman, and prime ministers Patrick Manning of Trinidad and Tobago, David Thompson of Barbados and Jamaica's Bruce Golding. St. Vincent and the Grenadines Prime Minister Dr. Ralph Gonsalves participated by telephone.

Jagdeo told reporters that in order for the region to have success in their medium term strategies to deal with the crisis, there is a need to deal with issues such as debt servicing ahead of the September meeting with the international agencies.

He said regional leaders "will argue that middle income countries with the peculiar vulnerabilities that we have in this region must be eligible for multilateral debt relief.”

He said the group would also seek resources to refinance some of the debt already contracted on commercial terms or with high interest rates.

“If support is secured at the level of the multilateral agencies, political support is also needed to ensure that middle income countries get multilateral debt relief," Jagdeo added.

The meeting also addressed the Venezuela-led Petro Caribe initiative under which several Caribbean countries are able to purchase oil and energy products from Caracas on concessionary terms.

Jagdeo said Venezuela's recent change to the payment structure would pose new problems for member states.

"The financing that they had was immediately available because we didn't have to pay the full cost of the import of oil...this change will jeopardise the arrangement and put some of our countries at a disadvantage when we most need this support," he said.

Jagdeo pointed particularly to countries in the eastern Caribbean which have faced enormous problems, with downturn in several sectors, and subsequent significant losses in revenue.

He noted that Antigua has lost 35 per cent of its revenue in the past year. "They have difficulties paying on a monthly basis, wages and salaries in the public sector, and this problem is not unique to Antigua and Barbuda," he explained adding that "we have to ensure, at the task force level, that they receive all the support they can get from the bilateral and multilateral agencies."

The Jamaican Prime Minister said his government has to stress the fact that the national budget was predicated on the PetroCaribe arrangement.

"We have already indicated to the Venezuelans that, while we understand some of the difficulties that may warrant a change in the PetroCaribe arrangement...any sudden change would have a significant effect on our external and fiscal accounts," Golding said.

At the same time he acknowledged Venezuela's generousity.

"To be allowing deferment for 20 years at 2 per cent of as much as 60 per cent of the cost of the product, is a significant amount of generosity and, given the difficulty that Venezuela is now facing, it is not difficult to understand why they may need to make some adjustments in those arrangements," he admitted.