CARICOM Heads of Gov’t summit opens in Georgetown today – Brexit likely to dominate discussions

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A number of issues have been placed high on the agenda for the Caricom Heads of Government Meeting starting today.
Caricom will meet for its 37th Regular Meeting on July 4-6, 2016, in Georgetown, Guyana, at the Guyana Pegasus Hotel.

Among the issues to be discussed are the threats posed by international banks limiting or terminating their relationships with regional financial institutions, and the yet-to-be-determined implications of the British decision to leave the European Union (EU), a key partner in the Community’s development.

caricom 1The Brexit vote has sent Britain and the rest of the world into a tailspin. The pound sterling fell to its lowest value in 30 years, and international financial markets took a downturn, as the implications hit home.

A Caricom statement explained that the Caribbean was not immune from the potential fallout, and economists and politicians alike are assessing the situation. It outlined that the majority of Caricom Member States were former colonies of Britain, which was a key ally of the Region within the EU.

While some have adopted a wait-and-see stance, confident that any domino effect would not occur in the short term, others are predicting immediate consequences and want the Caricom Member States to appreciate the value of regional integration and band firmly together to chart the way forward.

The concerns range from a drop in arrivals in tourist-dependent Member States such as St Lucia and Barbados where the UK is a major source market, a decrease in development assistance, to effects on trade agreements the Region has with the EU.

The Meeting will also seek to advance matters pertaining to regional security – economic and otherwise – and the social well-being of the approximately 16 million people who make up the Caribbean Community.

Critical services including remittance transfers, international trade, and the facilitation of credit card settlements for local clients, among other services, will be affected.

The genesis of this issue lies in the signal by several international banks, mainly in the US and Europe, to client banks in the Region of an unwillingness to continue carrying their business, as part of a so-called “de-risking” strategy.

The Caribbean has been labelled as a tax haven and accused of lax tax regimes and avenues for money laundering and terrorism financing, despite no evidence to prove this.

Guyana’s President David Granger had also disclosed that the strained relationship between Jamaica and Trinidad and Tobago was an agenda item at the meeting.

 

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