BASSETERRE, ST. KITTS, OCTOBER 11TH, 2016 (PRESS SEC) – On Saturday, October 8th, Prime Minister Dr. the Honourable Timothy Harris, who is the Minister of Finance for St. Kitts and Nevis, and other Ministerial counterparts throughout the Caribbean attended the Caribbean Governors Meeting chaired by Mr. Kyle Peters, the World Bank Group’s Senior Vice President of Operations.
The forum formed part of the 2016 International Monetary Fund/World Bank Annual Meetings, which took place from October 7th to 9th in Washington, D.C.
The World Bank comprises 189 member countries, which govern the Group through the Boards of Governors and the Boards of Executive Directors. The Boards of Governors consist of one Governor and one Alternate Governor appointed by each member country. The Governors are generally member countries’ Ministers of Finance or Ministers of Development.
Prime Minister Harris represents the Government of St. Kitts and Nevis as Governor. The Financial Secretary, Mrs. Hilary Hazel, is Alternate Governor. Alternates for both can fill in as needed. For instance, accredited members of the St. Kitts-Nevis delegation at the 2015 Annual Meetings of the Board of Governors of the World Bank Group, which was held in Lima, Peru from October 9th to 11th, 2015, were the Honourable Vance Amory, Premier of Nevis, who served as Governor and Mr. Calvin Edwards, Deputy Financial Secretary, who served as Alternate Governor.
At Saturday’s meeting in Washington, D.C., Mr. Kyle Peters, World Bank Interim Managing Director and Senior Vice President of Operations, commended Prime Minister Harris and his Team Unity Government for being responsive to the country’s citizens in preventing and managing disasters, as well as the other challenges of debt management, increasing competitiveness, and working to accelerate growth. He further commended Dr. Harris on his remarks to the Caribbean Ministerial Meeting. The Prime Minister of St. Kitts and Nevis underscored the vital role of international support and cooperation in facilitating advances for the Caribbean and its people, for instance on the important issue of energy security.
Dr. the Honourable Carla Barnett, Senator and Minister of State in Belize’s Ministry of Finance, presented on the loss of correspondent banking relations. Correspondent banking enables cross-border financial activity by allowing a respondent bank to enter into an agreement with a correspondent bank so that it can execute payments on behalf of the respondent bank and its customers. Correspondent banking transactions that have been particularly affected by the loss of correspondent banking relations throughout the world are U.S. dollar wire transfers, remittances and trade finance, including money or value transfer services.
In the Caribbean region, at least 16 banks across five countries have lost all or some of their correspondent banking relationships, as of May 2016. Prime Minister Harris and his Caribbean colleagues have sounded the alarm on the potentially devastating socio-economic impact of having international banks pull the plug on relationships with Caribbean banks. For instance, remittances (money sent back home by Kittitians and Nevisians who live abroad) to St. Kitts and Nevis in 2014 made up 6.1 percent of Gross Domestic Product (GDP), according to the World Bank Group.
Prime Minister of St. Lucia the Honourable Allen Chastanet made a presentation on energy, while Jamaica’s Minister of Finance, the Honourable Audley Shaw, presented on debt and fiscal sustainability.
More than 90 percent of CARICOM’s commercial energy consumption is fossil fuel dependent. The United Nations Development Programme (UNDP) has said that the cost of fuel imports to the Caribbean jumped from US$6.5 billion in 2004, to US$12 billion in 2007, representing between 16 percent and 21 percent of GDP, respectively. Some Caribbean countries are also among the most highly indebted in the world due in large part to unanticipated external shocks, structural factors and extreme weather events. The latter fact was highlighted when the Fourth Meeting of the Caribbean Development Roundtable was held in April at the St. Kitts Marriott Resort. The Roundtable explored possible debt relief options for heavily indebted countries in the subregion.
The climate resilience of small states was discussed at Saturday’s Caribbean Governors Meeting in Washington, D.C., as well as private sector mobilization and the role of the International Finance Corporation (IFC), which is a member of the World Bank Group.
Last Wednesday, October 5th, Prime Minister Harris met with the World Bank’s high-level authorities for the Caribbean in Washington, D.C. The delegation of St. Kitts and Nevis also comprised Her Excellency Dr. Thelma Phillip-Browne, Ambassador to the United States of America, and His Excellency Dr. Everson Hull, Ambassador and Permanent Representative to the Organization of American States.
The purpose of that meeting was to discuss the current status of St. Kitts and Nevis’ economy and the strategic priorities of the Team Unity administration led by Prime Minister Harris. The World Bank authorities, headed by Ms. Sophie Sirtaine, Country Director for the Caribbean Country Management Unit, congratulated Dr. Harris for the sound macroeconomic performance of the country. They also confirmed that the World Bank stands ready to support St. Kitts and Nevis in the important long-term development priorities highlighted by the Prime Minister, like the strengthening of the banking sector’s strategy to deal with any loss of correspondent banking relations, improving the delivery of social services like education and health care, and building adequate resilience mechanisms against climate-driven disasters.