(Trinidad Express) The prevalence of serious crime in the Caribbean is stunting economic growth in the region and is deterring investors from coming to this part of the world.
This was the opinion of president of the Caribbean Development Bank Warren Smith who was speaking at the Fourth Biennial International Conference on Business, Banking and Finance at the Hilton Trinidad yesterday.
The theme of the conference is “Restoring Business Confidence and Investments in the Caribbean”.
“Crime, particularly serious crime, including homicide has escalated in recent years and is now one of the highest in the world. This weighs heavily on the pace of growth and development by redirecting scarce resources and by deterring critical investments in other areas,” Smith said.
“Conservative estimates say that one to two per cent of GDP is shaved from annual output annually because of the rising crime rate. The region must work to reverse this worrying trend by targeting preventative strategies, particularly through youth at risk programmes.”
He said a 2005 report by the Inter-American Development Bank identified the root causes of crime as the destabilising income in equality, relatively high unemployment and chronic drug culture leading to access to weapons.
Turning his attention to the fiscal health of the region, Smith said several countries in the region were battling high levels of debt.
“A number of other countries have been battling with an unsustainable debt to GDP position for many years and they have been trying, in some respect, almost heroic levels to try to address those problems,” Smith said.
“They have found themselves in that position through financial imprudence and in some instances by natural hazards some Caribbean countries find themselves in a position where they are rebuilding each year.”
He added, “They have found themselves in a position where they have had to take tough measures and you’re seeing this across the board.”
He said the financial constraints being experienced by some countries present an opportunity for reform.
“This allows us to work with the countries on a reform agenda…These things are not going to see fruits immediately… in 2014 or 2016 we will begin to see the impact,” he said.
“Many countries have reached the point where if they do not fix the fiscal approach it will have the impact of being a drag on the economic growth and will undermine that investment climate that is so important.”
