Montserrat Can Benefit from CARICOM Development Fund, Says Minister of Trade
CHRIST CHURCH, Barbados – Current chair of the CARICOM Council for Trade and Economic Development (COTED) and Honourable Ministry of Agriculture Claude Hogan, says Montserrat stands to benefit from the CARICOM Development Fund once it accedes to it.
Minister Hogan was speaking at the Fifth Meeting of Contributors and Development Partners of the CARICOM Development Fund (CDF) held at ACCRA Beach Hotel & Spa in Barbados on Tuesday September 22, 2015. Under the theme “CDF’s Transition to the 2nd Funding Cycle – Targeted, Innovative and Dynamic” the chair announced that Montserrat was poised to join the fund in this new cycle.
“We have declared Montserrat as a Region of CARICOM, having special and differential needs as a full member of both the OECS and CARICOM and the Premier of Montserrat at the last Heads of Government declared Montserrat’s intention to accede to membership of the CDF.
“For the future, Montserrat needs to draw on both material and human capital to progress physical rebuilding and population growth relying on growth in several economic clusters using public-private partnership approaches, as far as possible, in our quest to make the private sector the engine of growth and the efficient provider of services. These clusters are: Port Development; Town Development; Housing; Hospital; New High School; Geothermal; Fibre-optic; Mining: Quarry, Tug and Barge; Finance and Professional Services; Tourism Services,” explained the COTED chairman.
Minister Hogan explained that the CDF is to receive from the European Union, USA, Turkey, Japan, China, and Trinidad and Tobago in the new cycle.
In his address, he noted that the CDF is a regional financial institution specifically dedicated to addressing the adverse social and economic dislocation arising from the operations of the CSME; pre-existing structural disadvantages as well as facilitate businesses in the disadvantaged countries, regions and sectors to take full advantage of new opportunities within the CSME and externally.
“The ultimate aim is to improve the lives of the people and to assist in reducing the level of disparities in the region. Unlike the other financing agencies in the region, this is their sole responsibility – an ambitious long term goal.”
The COTED Chair also shared the findings of the independent evaluation of the first cycle of the CDF.
“On balance the evaluators were favourably impressed by the CARICOM Development Fund (CDF) as an institution. They concluded that the strengths of the organisation substantially exceed the weaknesses. Moreover the weaknesses can readily be remedied. They urged the CDF to carefully manage the threats to its future sustainability and to maximise the opportunities for growth.
“The evaluators also examined the CDF’s technical and financial assistance programmes. On a scale of 1-5 with one being poor and 5 being very good, the weighted average of the CDF performance was 3.58. Relevance scored 4.48. The extent to which the programmes achieved their purpose was given an efficiency score of 3.26. Sound management and value for money, (Effectiveness) received a score of 3.13. The measurement of impact was 3.76. The Sustainability score of 3.25
“The programmes for Belize and St Vincent and the Grenadines scored consistently high grades.
“On the downside, the assessment showed that delays occurred in nine of the projects especially with respect to SME loans. However, the reasons for delays varied across countries and were not attributed to the CDF. From a COTED perspective, it is therefore fair to say that given the learning curve that had to be climbed by both the CDF and Member States, this first cycle performance provides a sound platform for the future interventions of the Fund.
“In hindsight, in the early years of the CDF, the Community may have had unrealistic expectations for this new institution. We may have wanted the CDF to begin running before it had learnt to creep or to walk. The CDF is now firmly on its feet and has done well. The Community expects that by the end of the cycle in 2020, the CDF would have made even more significant progress in fulling its mandate.
“My charge to the CDF is to be targeted, innovative and dynamic in your approach to assisting Member States in the new cycle, but be realistic and mindful of the challenges and uncertainties that loom in your operating environment. In the medium term while the recovery in the tourism and construction sectors is expected to boost growth in CARICOM Member States, this is likely to be partially offset by the softening of commodity markets. On the international front, recent volatility in international financial markets, the slowdown in China and other emerging economies, as well as a rise of geopolitical tensions in the Middle East pose downside risks to global trade and investment. The CDF will therefore have to be prudent and focused in the use of its limited resources.
In the first cycle the CDF created a niche in the development programmes of disadvantaged countries as a supplier of long term, low cost financing to Micro, Small and Medium-sized Enterprises (MSMES) through national development banks. In some countries this was the main source of external financing for these financial intermediaries.
Hogan charged the CDF to continue the support for Micro, Small and Medium-sized Enterprises (MSMEs) “especially since they are the main drivers of growth in small economies and access to financing and lack of competitiveness are the main impediments to their success.”
During 2015-20, the CDF plans to assist beneficiary Member States in the areas of energy efficiency, reduction of regional and sectoral disparities, human capacity development, specific infrastructure, and continued low cost financing for SMEs.