BRIDGETOWN, Barbados, CMC – The Barbados Minister in the Ministry of Finance, Ryan Straughn, says the most effective way for countries to recover quickly from devastating hurricanes and other natural disasters is to prioritize building resilience so that such events occur, rather than after.
Addressing the second Caribbean Debt Forum ahead of Wednesday’s two-day Latin America and Caribbean (LAC) Debt Group Annual Meeting, Straughn told local and regional financiers that their discussions must focus on whether efforts to mobilize financing are actually achieving countries’ resilience objectives and advancing their broader development agendas.
He said that although the region is still within the hurricane season, the Caribbean has not been building resilience as rapidly as needed.
“While we are experiencing these hurricanes every year…at the end of the day, it is what do we do to build resilience for our people up front? Whilst we have been advocating, under the Bridgetown Initiative, for the advancement of natural disaster clauses and other financial innovations, the key is that we really don’t want to experience a disaster and then get debt relief.
“We want to build the resilience up front so that when these events occur, the damage is minimized and we can recover as quickly as possible,” he said.
Straughn said that with another year and another storm the region still has not been able to advance the building of resilience fast enough, because having to rebuild has a cost “and we as citizens need to understand that governments don’t exist just to tax and spend, but how those tax dollars are deployed and mobilised will make a difference with respect to the long term trajectory of each of our countrie”.
Straughn said that Barbados has worked with the Caribbean Development Bank (CDB), the Inter-American Development Bank (IDB) as well as the Development Bank of Latin America and the Caribbean (CAF) and the World Bank on a regional debt swap framework, which according to him, other countries would see the template as something worthy to be used to execute a debt swap.
“Whilst debt swaps are not the only solution, I urge countries to look at what their portfolio portends in the next few years that allows them to work collaboratively… to ensure that we can utilise these financial innovations which would then allow us to create a little more fiscal space to focus on not just building resilience, but also the development agenda as we have set out in our countries.”
Straughn spoke of the importance of diversifying the government’s financing options, noting “that as the world is shifting geopolitically, we must be conscious as to the risks that we may be exposed to within the context of our debt portfolio.
“How do we ensure that our debt portfolios…can actually deliver on the development agenda in a manner that makes sense. And therefore, that is something I want to leave with you because it is easy to continue doing the things that maintain the status quo, but maintaining the status quo in a world that is changing could only be to your long-term detriment…
“These conversations with our citizens, these conversations with our partners are important because it is not intended in any way to signal any movement away from any institution,” he added.
The CDB, in partnership with the IDB, convened the Caribbean Debt Forum to address the region’s most pressing debt challenges and identify tools to build resilience and support sustainable development.
CDB’s Vice President, Dr. Isaac Solomon, underscored the importance of sound debt management for long-term economic stability, noting that effective debt management is central to the region’s fiscal sustainability and resilience.
“The Caribbean has made significant progress in recent years in strengthening fiscal discipline, modernizing debt frameworks, and restoring macroeconomic stability. However, despite progress, many economies continue to face elevated debt levels and unfavorable debt dynamics.”
Solomon said that these challenges have far-reaching implications for development, limiting governments’ ability to achieve the Sustainable Development Goals (SDGs) and respond to emerging needs.
The general manager of the Regional Country Department Caribbean at the IDB, Anton Edmunds, called for more coordinated action, highlighting the IDB’s focus on partnerships and collective interventions, pointing to his organization’s prioritization of solution-based, innovative debt transactions for SIDS.
Meanwhile, the LAC Debt Group’s Annual Meeting brings together 26 debt management offices from across the region to discuss the most critical debt management issues.
It said this year’s agenda will cover a range of topics, including macroeconomic perspectives for the LAC region, innovative debt instruments, and a market perspective.
Building more efficient debt markets in LAC, developing financial resilience strategies to manage uncertainty, and strengthening debt institutions.
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