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Speaker:The Honourable Basdeo Panday, Prime Minister of the Republic of Trinidad and Tobago
Date: December 4, 1999
Occasion: Address at the 40th Anniversary Celebrations of the Inter-American Development Bank
Ladies and Gentlemen:
It is a special honour for me as Chairman of Caricom to be associated with this distinguished hemispheric gathering commemorating forty years in the life of the Inter-American Development Bank.
The Inter-American Development Bank has established a rich tradition of service on behalf of the Governments and peoples of Latin America and the Caribbean, and has been a positive force for development and integration in the hemisphere.
It is fitting that this celebration of cooperative partnership should take place in Quitandinha (Qee-Tan-Deen-ya), where in 1954 the meeting of Finance Ministers of the American States gave decisive impulse to the proposal for the creation of the Bank.
But if Quitandinha has a special place in the Bank's history, so too must the former President of Brazil, Juscelino (Joo-Seh-Lee-no) Kubitschek (Koo-Bit-Schek), who was instrumental in the eventual establishment of the Bank in 1959.
Our host, President Cardoso, has followed in this fine tradition, by inviting us to this hallowed site to reflect on the Bank's accomplishments and its role in the coming century.
I thank you President Cardoso for your magnanimous gesture, and for your unstinting support to the cause of regional development and hemispheric solidarity.
Permit me to also pay tribute to the efforts of the Bank's First President Felipe Herrera, his successor Antonio Ortiz Mena, and the present President Enrique Iglesias whose leadership and vision have helped to shape the unique character of the Bank, making it the Bank of integration.
Excellencies,
Trinidad and Tobago is the site of the 1973 Chaguaramas Treaty establishing the Caribbean Community and Common Market, and has become the headquarters of the Association of Caribbean States - the latter being an interesting model of 'open regionalism' with its membership cutting across the entire OAS spectrum from the Andean Community to the Central American Integration System to CARICOM and the Group of Three.
We have always viewed regional integration as an important imperative, and the Inter-American system as the foundation on which to construct intra-hemispheric cooperation, and to deepen our relations with our partners from other continents.
This explains my presence earlier this year in Rio when I attended the historic Summit of the countries of the European Union and Latin America and the Caribbean.
This is why in September of this year I accompanied my colleagues, the Presidents of Central America, to the United States of America to promote support for the meaningful enhancement of the Caribbean Basin Initiative (CBI), as a means of fostering economic growth and building a more robust and diversified regional economy for the countries of the Caribbean and Central America.
A good example of this principle in action, has been the special partnership we have developed over the years with the Inter-American Development Bank.
Trinidad and Tobago was the first English-speaking Caribbean nation to join the Bank having done so in 1967.
And we at one point enjoyed the status of being both a borrower and creditor nation in our relations with the Bank.
To date, we have accessed over US $1 Billion in loan and technical cooperation resources in such key areas as health, education, agriculture, tourism, and human resource development.
In the 1970's, in recognition of the adverse impact of the oil crisis on countries of the region, Trinidad and Tobago was one of two borrowing member countries that agreed to provide 100% of its contribution to the Bank's concessional window, amounting to US $7.2 million, in fully convertible currencies.
Additionally in 1974 and 1977, we subscribed to two bond issues of the Bank to the extent of TT $35 million.
Excellencies,
The imperative of regional integration has assumed greater significance and urgency given the realities of the international trading regime, the dynamics of globalisation and the need for the region to ensure that its concerns and interests are reflected in the new and emerging global financial and trading architecture.
The existing international regime as you all know is not as yet sensitive to the special needs of developing economies, and in the case of Caricom, small economies.
I cannot overemphasize Caricom's determination to obtain support for the recognition of the plight of smaller economies of the hemisphere, and the need for the international community, including the international financial institutions, to devise innovative and flexible programmes to treat with our special needs and vulnerabilites.
Excellencies,
At the sub-regional level, Caricom's response to the changing global trade and economic environment is the advancement of the CARICOM Single Market and Economy which is scheduled for full implementation in the year 2000.
The objectives of this deepening of the integration process are expanded production, optimal allocation of resources, increased intra-regional trade and enhanced competitiveness and export capability.
There has been substantial progress in the elimination of all tariff and non-tariff barriers to intra-regional trade in goods; in a Common External Tariff for goods from third countries; and in terms of Protocols governing the creation of a free market for services, and the Movement of Capital and the Rights of Establishment.
The overall community integration process however, has faced several challenges over the years, paramount of which have included:
-the need to structurally adjust the national economies to maintain or increase growth with low inflation, and to respond to international economic shocks;
-the need to operate effectively in an increasingly open and competitive international environment characterised by global and liberalised markets for goods, services and capital, new information and communication technologies, and dominance of knowledge in the production process;
-the rise of mega economic blocs, including the North American Free Trade Agreements (NAFTA) and the negotiation for a Free Trade Area of the Americas;
-the decline in international prices of the major export commodities of the region, the challenge to preferential markets, and the need to diversify and shift production structures; and
-the rapid movement of finance capital and the need to strengthen the supervisory and regulatory arrangements for money and capital markets.
Excellencies,
The integration process in CARICOM has benefitted from a strong and positive working relationship with the Inter-American Development Bank (IDB) including support for key regional projects in the areas of education, justice, tourism, and capital market development.
In looking to the future, and to challenges which confront the Community into the Twenty-First Century, it is easy to envision a number of areas where IDB's support could be vital.
These include, but are not limited to:
(i) placing greater focus on strategies which accelerate the process of diversification, particularly the development of the services sector, upon which so many of our economies are dependent;
(ii) enhancement of the competitiveness of the private sector which requires not only appropriate Government polices, but access to capital and technical support including access to technology, information, and the re-engineering of production systems;
(iii) instituting the capacity to function in a knowledge-based economy through strengthening of the Human Resource Capacity, and access to computer and information systems;
(iv) the strengthening of the transportation infrastructure and encouragement of private investment, especially in the very small States; and
(v) ensuring access of all CARICOM States to the resources of the Bank, for both public and private sector activities.
In this regard, the smallest Members of CARICOM - the six countries of the Organisation of Eastern Caribbean States (OECS) - do not currently have direct access to the resources of this Bank through full membership. The five Caricom countries that now form the Caribbean Constituency in the Bank have agreed to surrender a portion of their shares to facilitate the entry of our smaller partners. This has already been communicated to the Bank's management.
Additionally, the rapid pace of integration envisaged in the FTAA could pose severe adjustment problems for some States - especially the smaller economies.
Failure to attenuate these adjustment problems in the FTAA could put an unbearable strain on CARICOM.
Excellencies,
The IDB is both a financial and technical institution with a long history of involvement in the analysis of integration processes.
Caricom expects that the bank will assume a leadership role in anticipating the resources which might be required both to deal with the adjustment problems, and to create the capacity to seize the market opportunities which will arise from hemispheric trade liberalisation.
The Inter-American Development Bank has been a good friend to Trinidad and Tobago, to Caricom, and to the cause of regional integration.
We look forward to taking that partnership to even greater heights in the new century as we work collectively to advance the economic and social development of the peoples we serve, and in whose interests we have gathered here today.
I thank you.
And May God Bless you all.