GEORGETOWN, Guyana (CMC) — Caribbean Community (Caricom) trade and economic development ministers say the region needs to develop robust strategies to respond to the impact the coronavirus (COVID-19) pandemic is having on Caribbean economies.
The Guyana-based Caricom Secretariat in a statement issued following the Council for Trade and Economic Development (COTED) meeting held last week, said that the impact of COVID-19 on member states was one of the main agenda items of the meeting.
It said the meeting, chaired by the Minister of Trade and Industry of Trinidad and Tobago, Paula Gopee-Scoon, was held against the background of steep output losses to the tune of about 20 per cent in 2020, the first year when protocols were established to help curb the pandemic.
Among the protocols were those that prohibited travel which had deleterious effects on tourism, for example, a sector on which the region depends heavily. Inflation, supply chain disruptions, high freight costs, a worsening debt situation and high commodity prices are among the other realities the region is encountering currently.
“In the face of high unemployment rates and job losses in the region, one of the critical priorities identified is expanding job opportunities and decent work for citizens. In the current scenario, proactive resource mobilisation; economic diversification; careful economic management with a focus on key sectors such as agriculture, tourism, manufacturing and health; and the adoption of e-commerce will be required to build resilient, sustainable economies,” the statement noted.
Caricom Assistant Secretary-General, Economic Integration, Innovation and Development, Joseph Cox, referred to the region’s peculiar position while addressing the two-day virtual meeting.
He warned that while some member states were poised to benefit from high commodity prices in the short term, the “price volatility which obtains in, for example, the oil market, render modern business planning over the medium term, founded on data analytics, a truly daunting task”.
“At this juncture, it is my considered view that Caricom member states are likely to experience a W-shaped recovery versus the U-shaped recovery posited. There is a slowdown in global growth with the IMF (International Monetary Fund) most recently reducing projections for 2022 by an entire percentage point, to 3.6 per cent, its second downward revision in a few short months.”
Cox said a further manifestation of this is the expectation that global oil demand will fall by 1.4 million barrels per day which would reduce oil demand to 99.6 million barrels per day on average which would be slightly lower than 2019 levels.
“Therefore, there are worrying recessionary headwinds which are facing the region and whereas cognizance must be taken of the recovery occurring in the tourism and travel industries, if the current geopolitical challenges continue for much longer, that too may create a new round of challenges. Indeed, it is expected that the referenced sectors could take more than three years to return to pre-pandemic levels,” Cox said.
He said the situation required “fierce urgency” and action that was “grounded in strategic nimbleness guided by pragmatism as optimised growth and development are paramount”.