Fourteen countries in total—11 island states (Antigua and Barbuda, Bahamas, Barbados, Dominica, Grenada, Jamaica, Montserrat, Saint Kitts and Nevis, Saint Lucia, Saint Vincent and the Grenadines, Trinidad and Tobago) and three continental ones (Belize, Guyana, and Suriname)—are served by Canada's Caribbean Program.
Canada has a separate bilateral program for Haiti as well.
These 14 countries have a population of approximately 7 million in total. With undiversified economies, a weak private sector and lacking economies of scale, they compete with each other for tourism, which accounts for 30 percent of the gross domestic product (GDP) and nearly one-third of the employment in the region.
In addition, the countries remain highly indebted—public sector debt averages 79 percent of the GDP (IMF 2012)—raising risks of macroeconomic instability. High debt servicing is already an obstacle to economic growth in the region.
The Eastern Caribbean region is situated in a hurricane belt and is a seismically active area—12 times as exposed to natural disasters as the world average. These circumstances result in a significant draw on public finances and undermine private sector capacity to sustain investment and growth. The global economic crisis of 2008-2009 has hit key sectors of the Caribbean economy, particularly tourism and commodity exports. Worker remittances, which are critically important in several economies, declined with the advent of the crisis and remain below pre-crisis levels. . Governments face serious fiscal difficulties, and public spending is being cut. Private sector investments and external capital flows have also f declined. Expected effects are a rise in unemployment, a greater degree of inequality, and an increase in crime. Job losses could lead to an ever-expanding and insecure informal sector.
The region has taken steps to join the separate economies in a single market called the CARICOM Single Market and Economy, although the process is not yet complete. Additional political will, leadership, and capacity development, coupled with broad based economic growth, will be needed to advance regional integration.
Overall, the governments in the region are politically stable, with a long tradition of democratic elections. Nevertheless, further work is needed to build the capacity of regional institutions and national governments.
A more competitive regional economy will provide the basis for investment, economic growth, and poverty reduction. Cooperation to develop effective regional services will strengthen security and social development. Caribbean states are committed to democratic practices, respecting human rights and fighting corruption.
In 2014, the Caribbean Regional Development Program was confirmed as a country/region of focus for the Government of Canada's international development efforts.
Canada supports the development agenda established by CARICOM to achieve regional cooperation and integration.
Canada's long-term goal in the Caribbean region is to help build a more prosperous and integrated Caribbean community, one that is able to generate sustainable economic growth, and eventually provide opportunity and security to its citizens.
Canada's support is directed at creating an enabling and predictable environment for economic growth through the increased capacity and accountability of public institutions and by fostering a more competitive private sector. Canada advances the rule of law and strengthens legal institutions. Canada's objectives for the Caribbean region also include assistance for improving the capacities of the governments to manage and respond to natural disasters and to strengthen regional disaster coordination mechanisms.
Canada supports efforts to promote sustainable economic growth, through:
- Strengthening the management of public financial resources, including debt management
- Increasing access to employment skills for youth
- Strengthening the productivity of small- and medium-sized enterprises and increasing participation in regional and global markets
- Promoting public-private partnerships that generate employment and attract investment for growth
Key anticipated results
- Improved environment for business development, trade, and integration
- More highly-trained staff in ministries of finance and central banks
- Established national debt-management policies and procedures in eight countries
- Strengthened technical, planning, financial, and managerial capacities of small and medium-sized firms
- Public-private joint investments in four physical infrastructure projects
- Improved justice system
- Mitigated the effects of natural disasters
Progress on Aid Effectiveness
Donor coordination remains strong with active sectoral working groups. For example, donor harmonization is advancing, with model initiatives underway in disaster management, trade and competitiveness, and public financial management. Canada plays a leading role in all of those areas.
As a region, the Caribbean is still working to develop a shared and coherent development vision. Regional institutions, such as CARICOM, have an important role, not fully realized yet, to mediate and articulate the often-divergent views, needs, and interests of member states.
Canada's support to regional and national institutions will help build capacity and alignment, foster regional cooperation and integration, and promote economies of scale that are not feasible at the national level.
- Supported improvements in public institutions, which helped two out of six countries complete medium-term debt management strategies and trained 64 Caribbean workers in loan negotiations.
- Helped six countries complete strategic management frameworks for enhanced tax administration.
- Helped all six Eastern Caribbean countries to conduct debt sustainability analyses annually.
- Strengthened the institutions responsible for financial sector supervision.
- Improved customs administration in the region, where four countries implemented post-clearance audit and risk management programs.
- Supported and financed the first-ever inclusion of the Caribbean in the World Bank’s “Enterprise Surveys”, the results of which provided policymakers with previously unavailable data on the state of doing business in the Caribbean.
- Improved the access to finance among micro, small and medium enterprises (MSMEs) by providing technical assistance to the Institute of Private Enterprise Development, the largest microfinance institution in Guyana.
- Provided technical assistance in support of legislative reform and institutional strengthening related to public-private partnerships.
- Provided funding for 13 public-private dialogue events in the region with a focus on challenges to growth and on ways to overcome them.
- Played an instrumental role in the development of the new CARICOM Regional Strategy for Technical Vocational Education and Training for Economic Competitiveness and Workforce Development.
- Developed a strategic framework for court management services in order to reduce the backlog in the courts.
- Helped five active sector work programs integrate disaster risk management policies out of a target of six by 2014.
- Developed and implemented, in five countries, the flagship Hospital Safety index and a database that tracks health sector progress in disaster reduction.
- Helped five countries adapt and implement at least two of the model Comprehensive Disaster Management tools (policy, legislation, strategy, structure) developed by the program.
- Trained 82 members, (22 men and 60 women) of the Jamaican Red Cross Society in its Community Disaster Response Team during hurricane Sandy in Jamaica.
- Supported improvements in public finance management which helped 4 out of 8 member countries to decrease their debt to GDP ratio;
- Helped 4 countries complete national mental health disaster plans and trained more than 350 Caribbean health workers to manage mental health issues after disasters;
- Delivered first aid training in 916 communities;
- Launched the first-ever Human Development Report for the Caribbean region, tackling the
- Strengthened midwifery skills in the region;
- Helped the Global Fund to Fight AIDS, Tuberculosis and Malaria provide HIV/AIDS treatment to 15,170 people, detect and treat 1,200 cases of tuberculosis, and distribute 150,000 insecticide-treated bed nets to prevent malaria between 2002 and 2012;
- Helped establish a life-long learning partnership among Jamaican farmers, educational institutions, and banks to improve livelihoods;
- Enabled the Caribbean Development Bank to build or upgrade 255 primary and secondary classrooms and train over 1,330 teachers, benefitting more than 40,200 students in the region.
- 5 countries introduced more efficient value-added taxes, leading to increased revenue for governments
- 6 countries are modernizing customs systems and procedures, resulting in increased trade within the region
- 8 countries adopted public financial management reform action plans
- 11 countries undertook bank supervision and stress testing, resulting in increased transparency and stability
- Continued to improve Jamaica's agricultural productivity, completing 40 commercial greenhouses (23 within the past fiscal year) and training participants, about 42 percent of whom are women
- Using the Caribbean Catastrophe Risk Insurance Facility, the governments of Barbados, Saint Lucia, and Saint Vincent and the Grenadines accessed US$12.8 million in insurance after Hurricane Tomas in October 2010, enabling these countries to maintain services during the crisis and reduce fiscal pressures
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