Building the Resilience of Small States

Forum on the Future of the Caribbean 5 – 7 May 2015

Context

• productivity• debt• youth unemployment• crime

Key Challenges

• borderless economic systems• knowledge-intensity of flows• on-demand economy• climate change

Mega Trends

3

Risk =

Risk of an economy

being harmed by an external economic

shocks

Vulnerability(adds to risk)

EXPOSURE Inherent features of

an economy rendering it exposed to external

shocks

Inherent Features● Trade openness● Export Concentration● Dependence on strategic imports● Proneness to natural disasters

- Resilience(reduces risk)

COPING ABILITYPolicy-induced measures that enable an economy

to withstand external shocks

Policy Measures● Macroeconomic Stability● Market flexibility (adjusted for financial riskiness● Good governance● Social development● Environmental management

A Vulnerability Resilience Framework

Where will we be by 2050?

Looking Ahead: 2050

• Where will the region be in 2050?• The Bahamas• Barbados• Grenada• Guyana• Jamaica• St. Lucia• Trinidad and Tobago

Looking Ahead: Policy Model

Looking Ahead: Real Consumption Projections

02,000,000,0004,000,000,0006,000,000,0008,000,000,000

10,000,000,00012,000,000,00014,000,000,00016,000,000,00018,000,000,00020,000,000,000

Bahamas Barbados Grenada GuyanaJamaica St. Lucia Trinidad and Tobago

Looking Ahead: Debt Projections

2000

.0

2003

.0

2006

.0

2009

.0

2012

.0

2015

.0

2018

.0

2021

.0

2024

.0

2027

.0

2030

.0

2033

.0

2036

.0

2039

.0

2042

.0

2045

.0

2048

.00

50

100

150

200

250

300

Bahamas Barbados Grenada GuyanaJamaica St. Lucia Trinidad

% G

DP

Looking Ahead: Crime

2000

.0

2003

.0

2006

.0

2009

.0

2012

.0

2015

.0

2018

.0

2021

.0

2024

.0

2027

.0

2030

.0

2033

.0

2036

.0

2039

.0

2042

.0

2045

.0

2048

.00

20

40

60

80

100

120

Bahamas Barbados Guyana Jamaica St. Lucia Trinidad

Hom

icid

es p

er 1

00,0

00

Looking Ahead: CO2 Emissions

0

1000000

2000000

3000000

4000000

5000000

6000000

Bahamas Barbados Grenada Guyana Jamaica

St. Lucia Trinidad and Tobago

Looking Ahead: Resilience Index

2,000

2,003

2,006

2,009

2,012

2,015

2,018

2,021

2,024

2,027

2,030

2,033

2,036

2,039

2,042

2,045

2,048 -

0.10 0.20 0.30 0.40 0.50 0.60 0.70 0.80 0.90 1.00

Bahamas Barbados Guyana JamaicaSt. Lucia Trinidad Grenada

Inde

x

Is this the future we want?

Some potential visions of the future

• Creative and enterprising economies in which innovation is the driver of productivity

• Youth fully integrated into national development

• A stable society where people are safe, secure and prosperous

• Environmental sustainability mainstreamed in the development process

• A region built on clean, resilient energy systems that make use of plentiful, local renewable resources and are capable of providing stable supplies of energy to all sectors of its society

A creative and enterprising economy in which innovation is the driver

Objectives Strategies Actions

To increase total factor productivity by 2 per cent per annum

Developing human capital- competencies for the knowledge economy

Implement regional curriculum reform to build competencies in core & technology –based subjects as well as, problem solving/analytical workplace skills

Develop a capability in R & D and increase ICT connectivity

To generate 4 % average annual GDP/per capita growth rate

Institutional strengthening, financing and marketing arrangements and incubation

Target SMEs and enterprising firms for financial assistanceDiversify markets e.g. expand into Latin AmericaEstablish incubation centres

To improve the enabling environment for greater private sector participation

Strengthening policy implementation, governance, accountability & transparency

Organize coaching sessions to build strong partnerships between the public and private sectors and within sectors

A creative and enterprising economy in which innovation is the driver

Objectives Strategies Actions

To advance the development of funds to finance major developments in small states

Strategic advocacy Develop regional approach to advocate for recognition of the vulnerability of small states and need for special consideration

Advocate for adherence to the commitments made by small states to ensure due consideration of their issues in development finance criteria

Youth fully integrated into national developmentObjectives Strategies Actions

To stimulate creativity at early childhood and primary school levels

Re-engineering curriculum & teaching modalities to respond to different intelligences and modalities

Engage a team of creativity and curriculum specialists to assess and reform curriculum

To increase youth employment by 5 or 10 per cent per annum

Talent management and workplace training re-engineering to engender creativity and problem solving aligned to private sector requirements

Implement project-based entrepreneurship activities at the secondary levelInstitute Regional annual art and science fairsInvest in talent programs & innovation skillsProvide incentives and awards to enterprising youth

Youth fully integrated into national developmentImproved youth employability through workplace skills

Develop workplace skills programmes to be implemented from the primary levelDevelop programmes that inculcate cultures of productivity amongst the youthEstablish a broad-based system of internship across the Region that funds youth exchanges to private sector entities in other cultures to expand their capacity to adapt to new environments

To reduce the incidence of violent crime among the youth to negligible levels within 5 years

Using a socio-economic developmental approach to crime and violence

Adopt a multi-sector approach to youth development

A stable society where people are safe, secure and prosperous

Objectives Strategies Actions

To implement crime prevention measures

Early warning systems Build institutional links between families, social services, youth organizations, clubs, CBOs & NGOs

To pursue ongoing human developmental approach to crime and violence

Poverty reduction, settlement and development plans

Social inclusion and cohesion

Reinvigorate and integrate the plans for poverty reduction, settlement and development plans to improve implementation

Build strong family and community networks

A stable society where people are safe, secure and prosperous

Objectives Strategies Actions

To reduce the homicide rates to 4 – 5 per 100,000

Effective policing and justice systems

Strengthen security capabilitiesShare intelligence through databases within the Caribbean and with partners

To build resilience to natural hazards

Planning and zoning systems Move core government functions & population centres from vulnerable areas

Environmental sustainability mainstreamed in the development process

Objectives Strategies Actions

To generate 10% annual increase in value added from responsibly developed environmental products

Development of the green and blue economy

Develop plans and seek financing

Implement modern waste management practices

To reduce vulnerability and improve resilience to natural disasters

Mitigation and adaptation to climate change

Build defences in vulnerable areas e.g. shorelines & land slide prone areasSource & pool financing Develop and implement regional projects that target globally available funds that support adaptation efforts

A region built on clean, resilient energy systems that make use of plentiful, local renewable resources and are capable of providing stable supplies of energy to all sectors of its society

Objectives Strategies Actions

To promote energy security & resilience through 100% renewables by 2050

Cost-effective renewable energy production

Enact national energy regulation appropriate to renewablesEstablish national renewable energy & energy efficiency policiesFacilitate access to low-cost capitalPromote local investment & ownershipReduce impediments & risks to investors

To minimize environmental loss/footprints

Develop systems to ensure that economic and social development does not increase environmental issues

Strong Institutions

Debt Management

& Fiscal Prudence

Shared Governance &

Regulatory Quality

Human & Creative Capital

Savvy Enterprisin

g

Transaction Efficiency

Market Diversification

Innovation Skills & Talent Development

Smart Innovatio

n

Business Eco-system &

Value Networks

Business Model

Innovation

Transformative Leadership &

Business Entrepreneurs

hip

* SIDS Innovation Resilience Index (Peterson, 2010)

Efficiency-based

Economic Resilience

Innovation-based

Economic Resilience*

Caribbean Private Sector Pathways: Creating New Frontiers with Innovation Resilience

Looking Ahead: Increased Productivity Growth

2,000

2,003

2,006

2,009

2,012

2,015

2,018

2,021

2,024

2,027

2,030

2,033

2,036

2,039

2,042

2,045

2,048 0

50001000015000200002500030000350004000045000

Bahamas Barbados GrenadaGuyana Jamaica St. LuciaTrinidad and Tobago

US$

GDP

Per C

apita

Looking Ahead: Increased Productivity and Fiscal Reform

Looking Ahead: Citizen Security

Looking Ahead: Energy Costs

2,014

2,016

2,018

2,020

2,022

2,024

2,026

2,028

2,030

2,032

2,034

2,036

2,038

2,040

2,042

2,044

2,046

2,048

2,050 0

50,000,000100,000,000150,000,000200,000,000250,000,000300,000,000350,000,000400,000,000450,000,000500,000,000

Bahamas Barbados Grenada Guyana Jamaica St. Lucia

Looking Ahead: Resilience Index

2,000

2,003

2,006

2,009

2,012

2,015

2,018

2,021

2,024

2,027

2,030

2,033

2,036

2,039

2,042

2,045

2,048 -

0.10 0.20 0.30 0.40 0.50 0.60 0.70 0.80 0.90 1.00

Bahamas Barbados Guyana JamaicaSt. Lucia Trinidad Grenada

Inde

x

Looking Ahead

What is the Caribbean you want?

What do you think is needed to get us there?

What do you think are the game changers that will put the region on

the higher development trajectory?

The End