OTTAWA, Canada, CMC—The board of governors of the Barbados-based Caribbean Development Bank (CDB) opened a two-day meeting here overshadowed by the controversial resignation of its President, Dr. Hyginus “Gene” Leon, and a warning that the bank finds itself at a crossroads.
Leon resigned from his position after being sent on administrative leave in April. His lawyers wrote to the bank indicating that it was “evident” that the CDB had “lost all trust and confidence in our client by the failure of the Board of Governors to prevent the continued violations of its Charter, policies, rules, and regulations about its elected President.
“Our client has therefore made the tough decision to resign his elected position of the President of the Bank with immediate effect,” the law firm wrote, adding the CDB had until May 4 “to negotiate an amicable separation,” also indicating that their correspondence should be viewed “as our client’s pre-action protocol letter” regarding the entire situation.
Fosters, a St Lucia-based law firm, said it would sue in Barbados “or any other more appropriate jurisdiction to enforce our client’s legal and constitutional rights.”
The CDB has not publicly responded to the lawyers’ concerns, and its external investigation into the matter is expected to be discussed during the two 54th annual meetings.
In his address to the opening ceremony, the temporary alternate governor for Italy, Simone Alberto Platania, speaking on behalf of CDB’s non-regional members, said this year has been challenging for the region’s premier financial Institution.
“Today, we find the bank at a crossroads. As bank governors, we are called upon to make critical decisions to ensure that the CDB grows more vital from this experience.
“We note the external, independent investigator has concluded its investigation of the President. We believe that a multilateral development bank that works to improve the living conditions of its recipients must lead by example. We expect the highest integrity, ethics, and transparency standards,” he said.
The Italian government representative said that lessons would be learned in the aftermath, adding, “Going forward, we should review arrangements for strong governance and look at procedures and processes.
“We should draw on best practices from other development banks to ensure that the CDB is best in class. In this way, we have to maintain confidence in solid governance, which underpins the credit rating of the bank and its ability to provide concessional support to its Caribbean members.
“The populations of the Caribbean deserve a Bank that will help transform the region and devote its energy to the wellbeing and prosperity of its people,” Platania added.
During Wednesday’s public opening ceremony, no other speak made reference to the situation regarding Leon, who had penned an 11-page letter to the governors warning that if there is no change within the financial Institution, “the next president may encounter the same challenges” that he faced during his tenure at the helm of the region’s premier financial Institution.
The St. Lucian-born economist and former senior International Monetary Fund (IMF) official had said it was also “reasonable to question whether the Board of Governors has been advised appropriately” regarding his situation and “whether the information provided to the investigators and the Board has not been contaminated…”‘
Platania said the deliberations over the next two days would take place in the context of broader discussions within the international community to reform and strengthen multilateral development banks and better address development and global challenges.
He said development banks have been called upon to work better as a system, to leverage their respective comparative advantages, and to coordinate better to maximize impact.
“The CDB is an essential component of this system and a partner of choice in the Caribbean region for other MDBs and International Development Partners,” he added.
In his address, the acting CDB President, Isaac Solomon, said the bank’s commitment to steering the region through any challenge remains steadfast.
“Caribbean citizens and communities can trust in our proven capacity to navigate whatever may come,” he said, adding, “Together, we will create a Caribbean that stands firm against climate change, boasts world-class infrastructure, and eradicates poverty.
“We stand with the people of our region, united in building a future brimming with resilient prosperity,” he said, noting that the theme for the meeting this year perfectly underscored “our current moment, Partnerships… for Resilient… Prosperity.
“Indeed, we know that our challenges are too complex and large for any organization, government, or community to solve alone. No institution on its own can achieve the tasks we have ahead,” the St. Vincent and the Grenadines national said, adding, “It will take all of us working together as one.
“We must work together to share knowledge, exchange ideas, and mobilize sorely needed resources,” he said, adding, “and that’s why I’m privileged to be here with so many thought leaders, innovators, academics, business leaders, indigenous groups from the Caribbean and Canada, policymakers, elected officials, and others so committed to the continued prosperity and development of the region.”
Solomon said that the CDB is pivotal in funding critical infrastructure projects, supporting economic and social development, and eradicating poverty across the region, describing the financial Institution as “the region’s best friend in times of disaster.
“Yet, it is only with the steadfast support of all of us, together, that we can ensure that these pillars not only endure but also lead us towards a brighter, more prosperous future.”
He told the opening ceremony that he was pleased to report that there has been “incredible momentum in meeting our vision of collaborating to build stronger Caribbean economies and societies.
“The Caribbean region has seen remarkable developments highlighted recently during key international fora,” he said, making reference to the Global Supply Chain Forum, which he told spotlighted the Caribbean’s innovative strides in digital transformation within logistics and supply management, significantly enhancing intra-regional trade efficiency and integration into global markets.
He said last year, the CDB approved over US$400 million in financing across diverse sectors, including water, renewable energy, education, health, and social protection.
He said poverty reduction is a cornerstone of CDB’s mission, and its flagship Basic Needs Trust Fund is a testament to this commitment.
“With close to 100 projects underway, representing a $30 million investment, we are making tangible differences in the Region’s poorest communities…whether it was the opening of the Caribbean’s first state-of-the-art therapeutic center at the Maxfield Park Children’s Home in Jamaica providing comprehensive support and healing for victims of child abuse…”
Solomon said gender equality remains a vital priority. In partnership with the International Trade Centre, the CDB launched the SheTrades Caribbean Hub, creating opportunities for women entrepreneurs to thrive.
“As the chair of the Multilateral Development Bank Working Group on Gender Equality, we proudly amplify the Caribbean’s voice on the international stage.”
But he said to ensure higher and sustained economic growth, focus on several key areas, including developing climate-resilient social and economic infrastructure, improving institutional frameworks through digitalisation, and embracing generative artificial intelligence.
He said there was also a need to enhance the region’s pool of human capital by reducing skill gaps and developing career pathways, creating an environment that will strengthen energy security and stabilize costs, and improving logistics to boost intra-regional trade and food security.
“Across all these challenges, I come to the same conclusion: none of us can do it alone. As we move forward, we recognize that making the necessary investments to achieve resilient prosperity will require greater access to adequate and affordable financing.
“And that’s why we’re committed to strengthening our partnerships, mobilizing the resources we need critically, and tackling our most significant problems at scale. “
Solomon said that while the CDB is mobilizing resources to meet critical development needs, it recognizes the challenges governments face with project implementation.
“This year, we are conducting rigorous analysis to identify the root causes of implementation issues in the region. To build in-country capacity, we will provide “hands-on” support to improve procurement processes and leverage our upgraded digital systems to enhance project monitoring and reporting.”
Solomon said that the board of governors was involved “each step of the way” in setting priorities, sharing insights, and holding us accountable. In the “days ahead, I look forward to discussing with you how we can take this collaboration to the next level, including in our roundtable discussion on the bank’s future direction.”
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