Caribbean Countries Decry Disparate Treatment By Global Financial System

UNITED NATIONS – Over the decades, representatives of Small Island Developing States (SIDS) have come to the United Nations General Assembly to state the case for fairer treatment of their developmental needs and challenges by the international community, but Caribbean Community (CARICOM) countries made their feelings strongly known, during the just-concluded 79th Session of the UN General Assembly Debate, that SIDS continue to be “severely disadvantaged by an unfair global financial system.”

They, therefore, amplified the global financial system’s inequities by the measurements and standards the system has employed to assess the region’s development. 

“We have argued for special and differential treatment because we are, indeed, different, indeed special, and, indeed, unique in our sizes, our economies, our finances, our social circumstances, our vulnerabilities,” St. Lucia’s Minister for External Affairs Alva R. Baptiste told the Debate.  

“And, despite our best efforts, it seems that we were simply engaging in odes to the deaf, because there has hardly been the type of concrete and fundamental responses and actions to change the rules and the systems that have been suppressing our developmental aspirations,” he added. 

However, Baptiste said SIDS have persisted in its advocacy, and have not abandoned their faith in the strength and advantages of multilateralism. 

Therefore, he said St. Lucia was “pleased to applaud” two recent decisions by the international community that provide an expectation that the unique vulnerabilities and special circumstances of his country and other SIDS will receive the particular attention they deserve: The Fourth International Conference on Small Island Developing States that was held in Antigua and Barbuda and the recent adoption by the United Nations of the Multidimensional Vulnerability Index (MVI).  

Baptiste said the Antigua and Barbuda Agenda for SIDS (ABAS), which adopted a new 10-year plan of action for SIDS, is “a bold new plan to give priority at the international level to the sustainable development needs of SIDS over the next 10 years and maps out the nature of the support which the international community must deliver in order to achieve them. 

“Through this Agenda, the economies of SIDS can be transformed, and so there must be absolutely no delay in its implementation and in delivering on the commitments made to bring life to its provisions. This cannot wait,” he stressed. 

While St. Lucia noted that that the resolution advancing the MVI calls for its voluntary adoption, Baptiste urged the international community to speedily adopt and implement the MVI, stating that it took the international community 32 years to develop and adopt “this vital and necessary tool for sustainable development and global equity. 

“Let us not wait another 32 years to test and implement it,” he said. “The MVI must be brought into use today. This cannot wait!” 

The St. Lucia External Affairs Minister said it is urgent “because the challenges facing our small, open and vulnerable economies are quite complex.”

He said Caribbean economies have, over the past two decades, been plagued by a number of inter-related and inter-locking factors including persistent fiscal deficits and high debt, stubborn and persistent structural rigidities.   

He said these inter-related factors have been significantly exacerbated by external shocks, including frequent and major fluctuations in energy prices, financial crises, and, more recently, the COVID pandemic, the Russian-Ukraine war and “the planet’s greatest existential threat: climate change.” 

Despite a quarter century of analysis, advocacy and prescriptions set forth by the leaders of SIDS and international institutions charged with advancing the interest of SIDS, “our travails are enduring in a global community largely disinterested in our well-being and that of small states generally,” said St. Vincent and the Grenadines Prime Minister Dr. Ralph E. Gonsalves. 

“We in SIDS remain unequally yoked in a global community motivated by the baser instincts of the untrammeled power of money, ideology, guns, lethal weaponry, territorial and global dominance. 

“To be sure, the SIDS have made incremental advances in the global community and in the architecture of international relations; nevertheless, for us in SIDS, it has been a situation akin to going up a down escalator in which the down escalator is moving at a faster pace than the upward baby steps,” he added. 

“Frequently, it appears as though much of the powerful would wish that SIDS did not exist,” Gonsalves continued. “But here, we are stubborn as the heavens; we are not going anywhere, despite our massive vulnerabilities. Our people have a permanence in this world, even if some of our lands wash away; we have a voice, and we will continue to use it.

“We demand as of right especial support from the international community to address efficaciously the unique social, economic and environmental vulnerabilities of SIDS in the interest of the nearly 70 million people who permanently occupy the seascape and landscape of SIDS, and, in the interest, too, of all the other eight billion or so persons who inhabit Mother Earth,” he said. “Small Island Exceptionalism ought to be a category embedded formally in international law and accorded most favorable treatment.” 

Rather than securing a most favorable treatment, the Vincentian leader said the SIDS are required to fight to maintain “even the special considerations, which Providence or serendipity has bestowed upon them.”

He said a case in point is the attempt, currently, by the International Development Association (IDA), to pit the most vulnerable — the SIDS — against the poorest countries in its quest to tighten the terms under which qualifying SIDS, of a particular income level, such as St. Vincent and the Grenadines, obtain soft-loans through the World Bank—IDA nexus.  

Gonsalves said the answer is not to penalize further the most vulnerable but for the richer countries globally “to put more money to the cause of the poorest; and to broaden concessionary treatment to vulnerable middle-income SIDS.”

He asked why the World Bank is persisting with “the single, anachronistic and ill-designed metric of average per capita income in respect of vulnerable SIDS, in the age of the Anthropocene, as against a more comprehensive and sensible measure of a Multi-dimensional Vulnerability Index?”

Antigua and Barbuda Prime Minister Gaston Browne said that the adoption of the MVI, which, he said, Antigua and Barbuda was honored to help advance at the UN, “offers a path towards correcting the imbalance of unjust treatment accorded to small and vulnerable nations.” 

He said it is “a vital tool, designed to acknowledge the complexities we face – not just in terms of limited economic capacity and other structural vulnerabilities and a lack of resilience –but also in our exposure to myriad external shocks.”

Browne urged international financial institutions act on this, integrating the MVI into their policies “to ensure that support is targeted where it is needed most.” 

He said there can be no just and sustaining reform of the World Bank, other international financial institutions (IFIs) and multilateral banks without their effective implementation and use of the MVI. 

“The international financial institutions, and the nations that sit on their controlling boards, must develop bespoke funding instruments that meet the needs of small vulnerable states and other developing countries, taking into consideration their vulnerabilities and lack of resilience,” the Antiguan leader urged.  

Barbados’ Prime Minister Mia Mottley said: “If ever there was a time to pause and reset, it is now, collectively as an international community and individually as leaders in each of our countries. We must now deliver new opportunities and solutions to these crises, which dampen economic growth, restrict the ambitions of our peoples and numb our sense of the beauty and goodness the world has to offer.

“The reset for which I am calling and, indeed, all our citizens are demanding, must see an end to all forms of discrimination,” she said. “That rules and institutions today exist, which create first- and second-class citizens, depending on your nation of origin; militate against trust, credibility and hope; and foster a crisis of confidence in the existing international order, which must become inclusive and responsive for all.

“We must ensure that global institutions give developing countries, especially small vulnerable ones like my own, seats at the tables of decision-making, where we can be seen, heard, become active agents in our own cause and lead our own development paradigms,” the Barbadian leader urged. 

She said nowhere is reform, and, consequentially, trust and hope, more important than in relation to the global financial architecture. 

Mottley warned that restricted access to capital, its disproportionately high cost, its inadequate scale and the overwhelming burden of debt are “now combining to force governments in the world’s poorest countries and, frankly, across many vulnerable middle-income countries, to devote more resources to debt service than to health, education and infrastructure combined.” 

St. Kitts and Nevis’ Prime Minister Dr Terrance Drew said, “The time has come to reshape the United Nations, to reform its structures, so that they reflect the realities of our modern world. 

“Too many voices remain unheard, too many nations marginalized,” he said. “The UN Security Council must include representation from the regions most vulnerable to the threats of our time—Latin America, the Caribbean and Africa.” 

But the St. Kitts and Nevis leader said nowhere is this change more urgently needed than in the international financial architecture, stating that St. Kitts and Nevis stands in solidarity with the Government of Barbados in its fight for financial and climate justice, pledging its full support for the Bridgetown Initiative. 

“This bold framework demands a reformation of global finance, making it more responsive to the unique vulnerabilities of Small Island Developing States,” Drew said. “We cannot build resilience without first ensuring that the international system works for the most vulnerable among us.”

Bahamas’ Prime Minister Philip Davis warned that aspirations to lasting global peace and security will remain empty dreams, if not supported by economic security. 

“For too long, the global financial system has been skewed against developing nations,” he said. “It is a cruel irony that industrialized nations, who bear the greatest responsibility for the climate crisis, often perpetuate another form of injustice in the form of our current global system.  

“We have been instrumental in exposing the hypocrisy of unilateral blacklisting, and advocating for a framework that prioritizes fairness and inclusivity,” he added, stating that the present system, “with its dark rules and uneven playing field, drains resources from developing countries, leaving us to grapple with the consequences.”

Davis said the Bahamas refuses to accept this double standard, making clear that his government is raising its voice to demand “a fairer and more equitable international framework, one where the voices of all countries, regardless of population or GDP (gross domestic product) are heard and respected.  

“We must reform the global financial institutions and systems,” he urged. “We need multilateral development banks that are fit for purpose, providing accessible finance and prioritizing climate-resilient investments. 

“We must continue to work to strengthen international co-operation,” the Bahamian prime minister continued. “We need a renewed commitment to collective, multilateral action.”

 As a member of the Alliance of Small Island States (AOSIS), one of 39 countries that have been on the front lines of the climate crisis, Belize largely blamed industrialized nations for the crisis, saying that its “genesis” lies with them. 

Minister of Foreign Affairs Francis Fonseca said the “perpetuation and acceleration” of the climate crisis also rest with the wider membership of the Group of 20 (G20) of the world’s industrialized powers. 

He said that, currently, the G20 accounts for some 80 percent of global emissions, and that AOSIS members contribute less than one percent.     

He said SIDS must be “at the table” in global economic and international financial institutions, and that the MVI should be incorporated into existing practices and policies for debt sustainability and development support in order to expand SIDS’ access to effective development finance.   

In the context of the General Assembly’s theme of “Leaving No One Behind” that requires the active promotion and protection of the right of self-determination, Fonseca urged that the same be done for sustainable development.   

“We have adopted a rescue plan to steer the SDGs (UN’s Sustainable Development Goals) back on course; we have a Pact for the Future,” he said. “We must use every opportunity to put in place the systems and financing necessary to turbocharge our sustainable development and climate goals. 

“In this effort, we must ensure equal opportunity for all to share in global prosperity.,” he added. “We must raise collective ambition and invest in all our people to empower them to rise.” 

Suriname Prime Minister Chandrikapersad Santokhi said, “the time has come, to dare, to make bold decisions, revisit our global governance architecture, and to recommit to the original goals of the United Nations.

“It is incumbent on us to close the gap between aspiration and financing,” he said. “I wish to emphasize the urgent need for accelerated reforms and coordination within the international financial architecture, especially the international financial institutions.”

Santokhi noted that the MVI offers a comprehensive and inclusive framework that goes beyond traditional metrics “to capture the true complexity of the vulnerabilities of Small Island Developing and Low-Lying Coastal States.

“We urge that the MVI is embedded in the operations of the international financial institutions, especially the International Monetary Fund and the World Bank,” he said. 

Besides the MVI, the Surinamese leader sees other financial obstacles in place that have “a major negative impact on our ability to generate development, especially de-risking measures of international banks, which are based on general assessments, and do not consider the countries reality and the severe impact on development objectives of th country. 

“This must be addressed head on, if we want to be inclusive rather than exclusive,” he said. 

Guyana’s President Dr. Irfaan Ali said there is a growing movement in the developing world calling for the democratization of global political and economic relations. 

He noted that the disproportionate concentration of power favors a few powerful nations, while marginalizing the voices and concerns of the broader international community.  

“Developing countries are justly demanding more inclusive and representative decision-making processes in institutions and organs, such as the UN Security Council, the World Bank and the IMF,” he said. 

Ali said the World Trade Organization must also be reformed “to ensure fairer trade for developing countries,” stating that these reforms must go beyond fair representation, and “ensure that the policies and practices of these institutions align with the developmental needs and aspirations of all countries.”

Dominica’s President Sylvanie Burton said that while Dominica, along with other Caribbean States, has already prioritized the development of national climate adaptation strategies, invested in resilient infrastructure and agriculture, invested in community education and in renewable energy, “still, the reality is that, as important as our interventions in this crucial space are, they will remain ineffective if our friends and partners in the industrialized world do not honor their commitments to reduce global warming, and provide the funding that is required to enable our low-emitting States to become resilient.  

“Our world is at the crossroads – now, more than ever,” Burton said. “Leadership at every level matters. “My delegation is of the firm view that the fundamental principles of the UN Charter must be respected, no matter which Member State may be under scrutiny. 

“This is no source of joy to my delegation, but these critical times demand that important truths be spoken frankly,” the Dominica president added. “A glaring hypocrisy clouds this august body when right seems to pass as wrong, wrong seems to pass as right, depending on which Member State is being impacted. This practice of might makes right must be discontinued.” 

Noting that Haiti is one of “the least connected countries”, President of the Presidential Council of the Transition of Haiti Dr. Edgar Leblanc Fils called for urgent support “to fill in the digital divide” and enable his country’s participation in the global economy.

“These global challenges can only be addressed through renewed commitment to multilateralism, through solidarity and collective action,” he said, pledging his country’s commitment to build, together with the international community, “a future where peace, justice and human dignity are triumphant”.  

Jamaica’s Foreign Affairs Minister Kamina Johnson Smith said the country also welcomes the adoption of the MVI by the General Assembly, and called on development partners, including multilateral development banks and other international financial institutions, to urgently examine the Index and commence its use. 

“Rather than considering GNI alone, it accurately takes into account the structural and environmental vulnerabilities of SIDS,” she said. “Its use by MDBs will better align access to, and terms of, financing with supporting these countries with their developmental needs.” 

 Johnson Smith said Jamaica commits to advancing dialogue and cooperation with stakeholders in the international capital markets to adapt their operations to the vulnerability- resilience profiles of SIDS. 

“Improved access to development financing is critical for SIDS, which are particularly off-track in attaining the SDGs,” she said, stating that the SDGs were adopted by leaders as a universal clarion call to tackle poverty, ensure peace and promote prosperity. 

Johnson Smith said the upcoming Fourth International Conference on Financing for Development presents “an opportunity to commit to tangible deliverables to address the current financing challenges.”

She said these include “impactful, practical and meaningful reform of the international financial architecture to strengthen the voice and representation of developing countries in international decision-making, and to substantially improve the quantity, accessibility and affordability of financing for development.”  

Johnson Smith said the adoption of the Pact for the Future, the Declaration on Future Generations and Global Digital Compact “signal renewed hope in multilateralism.  

“The consensus demonstrated our collective resolve to deliver inclusive and durable solutions to current and emerging global challenges,” she said. “With foresight, political will and joint action, we can deliver a better world for future generations.” 

Grenada Prime Minister Dickon Mitchell made resilience the core of his contribution to the United Nations General Assembly Debate, saying that he wanted to speak about the topic in the face of climate change, paths to economic resilience and the role of education in ensuring both. 

He said that resilience is not something that can be built overnight; “it requires partnerships, innovation and a shared commitment to a better future.” 

He invited the international community to “join us,” asking for the US$100 billion promised to support climate adaptation and mitigation to be met. 

“Partnership, in our case, requires concrete financial support to help us rebuild with greater resilience,” Mitchell said. “But beyond that, we are also inviting the international community to partner with us, so that we can share our experiences and learn from one another. 

“In return, we offer our lessons in resilience,” he added. “We offer the knowledge that comes from living with and dealing with the worst of climate change, from building back after devastation, and from finding innovative policies and programs to secure a digital future.

“Grenada — and CARICOM — stand ready to share these lessons with the world because  resilience is not just about surviving a storm; it is about ensuring that, together, we emerge from it stronger, more united and more understanding of each other than ever before,” Mitchell continued. 

Trinidad and Tobago Foreign and CARICOM Affairs Minister Dr. Amery Brown noted that the Fourth International Conference on Small Island Developing States that was held in Antigua earlier this year underscored the “critical nature of the next decade for SIDS.  

“We are very proud of what our fellow CARICOM Member State achieved in successfully hosting this impactful conference,” he said. “Trinidad and Tobago anticipates that the robust implementation of the Antigua and Barbuda Agenda for SIDS will bring us closer to sustainable development, with the necessary means of support from the international community.” 

Like many others, Dr. Brown noted that Trinidad and Tobago has long called for the application of new multidimensional parameters for decision-making on access to financing.

In this regard, he said the twin-island republic welcomes the recent adoption by the General Assembly of the Resolution on the Multidimensional Vulnerability Index, and urged the international community and the relevant financial and development institutions to utilize the MVI, “as it takes into account the realities that undermine sustainable development.”