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Contact:
Claudia Monlouis
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Sir Dwight Vennor Governor ECCB |
Friday, May 06, 2005 - Economic growth has returned to the Eastern
Caribbean sub-region following “post 9 11” contractions in these economies in
2001. This finding has been published in the recently completed Eastern
Caribbean Currency Union (ECCU) 2004 Regional Surveillance Report. The report
was prepared by officials of the International Monetary Fund (IMF) following
intensive research into the macroeconomic conditions of ECCU member states.
According to the report, the region’s economies strengthened in 2003 by 2.5
percent and there were significant improvements to overall fiscal balances. This
reinvigoration of growth was primarily driven by the tourism industry which
picked up pace as security concerns for global tourism in the aftermath of 9/11,
have diminished. The IMF also notes that several new tourism facilities and
tourism related services have been developed in the islands.
According to the report, the weakening of the US dollar against major currencies
and fewer natural disasters also contributed to improved of goods and services
in 2003/2004. Meanwhile reserve coverage of the Currency Board has continued to
increase well beyond the statutory level of 60 percent and inflation remains
very low.
St. Lucia and St. Vincent and the Grenadines in particular have been singled out
by the IMF
as having maintained respectable levels of output. However the report expresses
concern that in other member states, output is estimated well below potential
levels.
Those issues and many more factors related to the economic activities of the
ECCU states were presented during a video conference for the for media
representatives from the Eastern Caribbean region on April 28th. The session
chaired by Sir Dwight Venner, Governor of the Eastern Caribbean Central Bank,
accompanied by representatives of the IMF’s Western Hemisphere Department Ms.
Ratna Sahay.
Sir Dwight says “it is very important from time to time as in these currency
union surveys that an assessment is done of the performance of these economies.
The Fund’s assessment is, by and large, one would say an objective one. What it
does for the region is that it allows us, since we don’t have access to
international capital markets, to have a forum where these economic issues can
be placed on the table.”
Sir Dwight says the ECCU faces great challenges both domestically and
internationally. He says the only way the challenges can be countered is through
open economic dialogue between the Fund and member countries. This type of
openness will foster integration and serve to strengthen the ECCB’s markets.
“We’ve met with some measure of success in this area and of course you will be
aware that recently Grace Kennedy from Jamaica has listed on our market, which
is a significant break through for the ECCB or ECCU area. In implementing what
we call a wider strategy of economic and financial integration, with the region
as a whole, we’ve now established ourselves as the regional stock exchange; and
that is a platform complimented by measures of stability, which we hope will
push the currency even more forward.” Sir Dwight said.
Some areas which the IMF focussed on in its 52 page report included
macroeconomic conditions in the ECCU countries, Public Debt Levels, Caribbean
Preferential Trade Arrangements and Fiscal Slippage.
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