Economist offers nine-point plan to help Caribbean thrive
Economist offers nine-point plan to help Caribbean thrive . Macroeconomic management in an era of polycrises By Central Bank of Barbados BRIDGETOWN, Barbados – Renowned economist and sustainable development advocate Professor Jeffrey D. Sachs has outlined nine priority areas for Caribbean economies as the region faces multiple challenges at the same time. Delivering the 37th Adlith Brown Memorial Lecture on the topic “Macroeconomic Management […]
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Macroeconomic management in an era of polycrises

By Central Bank of Barbados

BRIDGETOWN, Barbados – Renowned economist and sustainable development advocate Professor Jeffrey D. Sachs has outlined nine priority areas for Caribbean economies as the region faces multiple challenges at the same time.

Delivering the 37th Adlith Brown Memorial Lecture on the topic “Macroeconomic Management in an Era of Polycrises,” he offered a to-do list for how the Caribbean could not only survive, but thrive in today’s complex economic landscape. Below are his recommendations for the region.

Educational excellence up to the tertiary level

Professor Sachs, the director of the Center for Sustainable Development at Columbia University, stressed that education is the foundation of economic success. He advised Caribbean nations to ensure high-quality education from primary through tertiary levels, with an emphasis on preparing students for the global job market. By investing in education, he asserted, the Caribbean can develop a highly skilled workforce, positioning itself as a competitive player worldwide.

“To my mind, this is the ultimate winning economic development strategy.”

Specific job skills for an AI-led world economy

With rapid advances in artificial intelligence, the skills required in the workforce are evolving quickly. Sachs, therefore, emphasised that job training must keep pace with these changes. Equipping students and workers with skills tailored to an AI-driven economy will ensure they are prepared for high-paying, tech-enabled roles, he said. Sachs added that the future economy will involve a base level of higher education followed by a lot of training.

Quality digital connectivity

Sachs noted that the ability to work online from anywhere is increasingly a reality for many skilled workers. As a result, high-quality internet infrastructure – 5G or 5G+ – would allow Caribbean residents to engage in global digital markets without having to relocate. This shift will create more remote work opportunities, enabling skilled individuals to contribute to the region’s economy from within.

Climate-resilient infrastructure

With the Caribbean facing an ongoing threat from climate-related disasters, he urged governments to invest in resilient infrastructure to mitigate the impacts of extreme weather events and safeguard economic stability.

“We’re going to be in a more unstable climate, without question, and understanding where to invest and, of course, then getting the financing to make those investments at the scale needed, will be absolutely essential,” advised Sachs, who serves as president of the UN Sustainable Development Solutions Network.

Access to climate funding and compensation

He also highlighted the need for the Caribbean to receive international financial support for climate resilience projects. With disproportionate climate impacts on the region, he called for fair compensation and funding from countries that contribute most to climate change. Engaging in global negotiations is critical to securing this support:

“One of the key things that all of the Caribbean needs is access to high quality, low cost, long-term finance in order to be able to carry out the investments for climate resilience. In fact, a lot of that finance should be in the form of grants or one could even say climate compensation, because as is obvious to all of us, the Caribbean is bearing a cost due to an externality imposed by the United States and the rest of the high-income world.”

Creation of a robust insurance system

To address the economic toll of natural disasters, Sachs recommended a well-funded insurance model that provides predictable and quick payouts when disasters strike. This system would allow Caribbean nations to recover faster and reduce the financial instability caused by recurrent climate events.

New tax arrangement with the United States

Professor Sachs pointed out Caribbean nationals who work abroad often contribute significantly to foreign economies without paying taxes back home. He suggested a tax-sharing agreement with the United States and other countries where there are large numbers of Caribbean workers, ensuring the region benefits from its citizens’ overseas earnings.

“The Caribbean needs a new tax arrangement with the United States, for the United States essentially to remit part of the income tax earned by Caribbean nationals who are working in the United States,” he said, adding that such a system would support vital public services like education.

Strengthen international advocacy on financial issues

The Caribbean has a unique opportunity to advocate for global financial reforms, especially concerning debt and climate finance. Sachs encouraged the region to influence international summits, pushing for fair credit ratings and more accessible funding.

“Your prime minister… needs to play a big role in COP 29 in Baku and in COP 30 in Belém, and in next year’s fourth financing for development summit which will be in Madrid… to finally get the global financial architecture fixed so that the credit ratings of the Caribbean island states are improved.”

Caribbean nations often face high interest rates due to low credit ratings, which can hinder access to affordable financing. Sachs recommended working with international organisations to improve the region’s credit standing, potentially through innovative approaches such as climate-linked debt adjustments or credit guarantees.

Address regional security and violence

Professor Sachs also pointed out that high levels of crime and violence disrupt social and economic stability in the Caribbean. He, therefore, called for coordinated efforts to tackle gun trafficking, the drug trade, and other crime sources, noting that strengthening security measures would improve quality of life and support economic growth.

Sachs believed this nine-point roadmap will help Caribbean nations to achieve resilience, protect their economies, and secure a sustainable future.
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2024-11-22
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Macroeconomic management in an era of polycrises By Central Bank of Barbados BRIDGETOWN, Barbados – Renowned economist and sustainable development advocate Professor Jeffrey D. Sachs has outlined nine priority areas for Caribbean economies as the region faces multiple challenges at the same time. Delivering the 37th Adlith Brown Memorial Lecture on the topic “Macroeconomic Management […]
The post Economist offers nine-point plan to help Caribbean thrive appeared first on Caribbean News Global.
Economist offers nine-point plan to help Caribbean thrive