Barbados' Attorney General and Minister of Home Affairs, Adriel Brathwaite, has suggested that Caribbean countries should cement their unity by establishing a nationally owned regional commercial bank. The proposal has been advanced as a safeguard against threats from foreign-owned international institutions that they would downsize operations or pull-out investment from the region altogether.
“We are going to have to take the bull by the horn, as it were and address the whole issue of how do we ensure that there will be banking in this region for our people. And it is my recommendation that heads of this region consider either investing in one of the existing international banks; taking a majority shareholding and/or buying one; and/or forming one and taking it as international as possible,” Brathwaite said.
Speaking at a luncheon Friday, he stressed that such measures would offer the region financial protection, as opposed to remaining dependent on foreign shareholders or directors whose only interest is turning a profit.
Citing Canadian Imperial Bank of Commerce, or CIBC, which recently decided to sell its majority shares in the First Caribbean International. Adriel said this was a sign that the Caribbean community needs its own bank.
“From a regional perspective...we should form, and/or acquire an international bank, so that when these issues arise, some shareholder or some director outside of Barbados [doesn’t] make a decision to move the bank, sell the assets and disappear and then we are scrambling because our people don’t have any banking resources,” Brathwaite said.
A report published by the Inter-American Development Bank's (IDB) Office of Evaluation and Oversight (OVE) predicts that Barbados will need budgetary assistance from the International Monetary Fund (IMF) following the May 24 general elections.
The report titled the Approach Paper Barbados 2014-2018 Country Program Evaluation, also indicates that Barbados' government has been borrowing billions to bridge the gap between state expenditure and revenue. The report also highlights the country's low foreign reserves figures as an area of concern.
“Most analysts are predicting that after the upcoming election, the government will negotiate a program with the IMF to address the debt and international reserve challenges,” the IDB noted.