Finance Minister Larry Howai has challenged the Group of 24 (G24) countries to take a leadership role in formulating an appropriate mechanism to facilitate an orderly and predictable restructuring of sovereign debt for its member states, many of which are classed as developing nations.
Howai, who is in Washington, DC to attend the Spring Meeting of the International Monetary Fund (IMF) Board of Governors, addressed the meeting of G24 nations (of which Trinidad and Tobago is a member), saying there was a need for special consideration to be given to the needs of small island Caribbean States.
Caribbean economies, Howai said, are locked in a vicious cycle of low growth and high debt and because of their middle-income status, concessional financing is generally unavailable; even though some countries have entered into debt restructuring programmes with the IMF, the outcome of such restructuring can be described as “too little too late”.
“Given the limited progress in advancing a comprehensive debt workout framework, we are calling on the G24, as the representative body for emerging market and developing economies, to take a leadership role in formulating an appropriate mechanism to facilitate an orderly and predictable restructuring of sovereign debt,” he said in a statement from the Ministry of Finance Thursday night.
Howai said a collaborative approach should be undertaken with international financial institutions and other stakeholders to generate the best possible outcome for restructuring Caribbean sovereign debt.
He noted the risks and setbacks on economic development faced by emerging market debt currency (EMDC) and least developed countries (LDCs) as a result of both natural and man-made disasters, suggesting the establishment of a special fund, on concessional terms, to assist with natural disasters.