Caribbean & Central America - November 2014 (ISSN 1741-4458)

*** A WORD OF CAUTION TO ST KITTS & NEVIS. At the 23-24 October International Monetary Fund (IMF) forum in Jamaica on Unlocking Economic Growth (see pages 5-6), the IMF identified St Kitts & Nevis as an ‘outlier’ among the slow growing Eastern Caribbean Currency Union (ECCU) countries. St Kitts & Nevis is projected to grow by 3.5% in 2014.

One of the reasons for the robust growth in St Kitts has been the success of its Citizen-by-Invitation (CBI) programme, which has generated significant income for the country. However, speaking about the success of the CBI programme at the growth forum, Alejandro Werner, the IMF’s director for the Western Hemisphere, warned: “Prudent management is key to containing the risks associated with these programmes as large and volatile CBI inflows may increase macro vulnerability”. He warned in particular against “reduced fiscal discipline”.

The IMF’s pleasure with St Kitts is understandable. In the three years between July 2011 and July 2014, it has converted a fiscal deficit of 7.6% of GDP into a surplus of 12.3%, and it has reduced its debt-to-GDP ratio from 159.3% to 103%. This was achieved in part by the CBI programme, in part by imposing a three-year hiring and wage freeze, and in part through a debt-for-land swap. Further use of the debt-for-land swap mechanism is expected to reduce the debt-to-GDP ratio to 86.2% by end-2014.

*** CRICKET WOES. Cricket is one of the great unifying forces in the Caribbean, so there is more than just sport at stake in the latest debacle for West Indian cricket. From the mid-1970s until the early 1990s, West Indian cricket reigned supreme. In recent years, West Indian cricket has been a poor shadow of its former self – but in the past month it has reached a point so low that no-one could have predicted it.

On 17 October, the West Indian cricket team abandoned a tour of India because of a pay dispute between the cricketers and the West Indian cricket board. As a consequence, five matches were left unplayed: a one-day international, a 20-20 international, and three five-day Test Matches. The Board of Control for Cricket in India (BCCI) has said that it might sue the West Indies for lost TV revenues amounting to US$65m. It has also suspended all bilateral tours to the West Indies. Before this debacle, India was scheduled to play five series against the West Indies during the next eight years, including four tours to the West Indies.

West Indian cricketing legend Sir Andy Roberts believes that the key move for the West Indies to make now, even before conducting its own full post-mortem, is to send a high-level delegation to India to mend fences. Highlighting how important this matter is for the region, Roberts said: “We should [send]…maybe one or two prime ministers because I think we may need governmental intervention.”

The abandonment of the tour of India by the West Indian cricketers is set to dominate the meeting of the International Cricket Council on 10 November. The West Indies’ planned December-January tour of South Africa and its participation in the World Cup next February will be high on the agenda.

• Trinidad turns to China for military aid

On 13 October, Trinidad & Tobago signed an agreement with China for TT$30m (US$4.7m) in military aid. This was the eighth agreement for military aid from China since 2000. Ahead of the signing of the latest agreement, Gary Griffith, the minister for national security, held discussions with China’s deputy chief of staff General Wang Guanzhong covering the reciprocal exchange of military personnel, training of Trinidadian officers in Beijing, and training for disaster preparedness.