Caribbean Trade Law and Development

Tag: Caribbean

  • Bank De-risking: An Emerging Threat to Caribbean SIDS’ Survival

    Bank De-risking: An Emerging Threat to Caribbean SIDS’ Survival

    Alicia Nicholls

    De-risking actions by banks in advanced economies are an emerging threat to Caribbean SIDS’ financial inclusion and sustainable development. This reduced risk appetite by foreign banks is in response to an increasingly stringent regulatory environment aimed at combating the twin threats of money laundering and terrorist financing. De-risking actions have impacted Caribbean countries in two main ways: the severance of correspondent banking relationships with regional banks and the denial or withdrawal of services to money transfer operators. The net result is that Caribbean SIDS face the threat of being cut out of the global financial system, while the fall-out from the loss of remittances and the impact on their financial sectors, cross-border trade and investment could pose serious threats to these states’ economic growth  and sustainable development prospects.

    What is De-Risking?

    In an increasingly inter-connected world where money can be moved across the globe with the click of a mouse, anti-money laundering efforts and efforts targeted at combating the financing of terrorism (AML/CFT) are national and global security priorities particularly for the US and European countries.

    The regulatory authorities and courts in these countries have taken a zero tolerance approach towards their banks found to have willingly or unwillingly facilitated financial crimes like money laundering and tax evasion. Banks are increasingly facing tougher regulatory policies and sanctions and face the threat of onerous penalties, prosecution, private lawsuits and reputational damage if they are found to have facilitated financial crime

    The Financial Action Task Force (FATF)’s risk based approach requires that “countries, competent authorities and banks identify, assess, and understand the money laundering and terrorist financing risk to which they are exposed, and take the appropriate mitigation measures in accordance with the level of risk”.

    However, in response to an ever stricter regulatory environment, an increasing number of banks in advanced economies are seeking to reduce their risk exposure by engaging in “de-risking”. That is, instead of managing risk in line with the FATF’s risk-based approach, they are avoiding risk altogether by terminating or restricting business relationships with clients, regions or in sectors deemed to be high risk.

    Driving Factors of De-Risking

    The Caribbean is increasingly seen as a high risk area for banking. This state of affairs is regrettable as Caribbean countries have expended significant time, funds and effort to make themselves compliant with international standards and best practices, including updating their anti-money laundering legislation. Caribbean states have also signed Foreign Account Tax Compliance Act (FATCA) agreements with the US government.

    Despite these efforts, Caribbean countries have had to continuously duck from the target placed on their backs by authorities in advanced economies. The US Department of State’s International Narcotics Control Strategy Report 2015 identified several countries, including  in the Caribbean, as ‘jurisdictions of primary concern’ for money laundering and financial crimes. Coupled with the frequent ‘tax haven’ smear, this only reinforces the notion that dealing with Caribbean banks is literally a risky business.

    Banks in advanced economies are increasingly wary of the exposure to risks of financial crime inherent in corresponding banking relationships. Correspondent banking relationships are entered into bilaterally between banks and allow banks to offer their services in a country in which they have no physical presence through the use of a correspondent bank in that foreign jurisdiction. A correspondent bank can conduct business transactions, receive deposits and make payments on behalf of the other bank. In effect, the bank is placing its faith on the due diligence and transaction monitoring rigor of the correspondent bank, increasing the risk it can be unwittingly used as a vehicle for money laundering.  As such, a major manifestation of de-risking is the severing of correspondent bank relationships with banks in countries and regions perceived to be “high risk”.

    A second manifestation of de-risking by banks is seeking to limit their exposure by getting out of higher risk sectors, such money transfers, through the denial or withdrawal of bank accounts and services to money transfer operators for fear of unwittingly assisting in terrorist funding and money laundering.

    Impact of De-Risking on Caribbean SIDS

    The impact of de-risking is already being felt in the region. Only a limited number of foreign banks have correspondent relationships with Caribbean banks and this number has been decreasing. This has made it difficult for Caribbean banks to find corresponding banks in advanced economies for the completion of transactions. Just this year the Bank of America cut its correspondent banking relationship with Belize Bank and Atlantic Bank International in Belize, compromising these banks’ ability to execute US dollar bank drafts, wire transfers and foreign currency transactions. In most cases banks are ending correspondent relationships without evidence of wrongdoing on the part of the regional bank and without giving clear reasons for their actions.

    Correspondent banking relationships are Caribbean SIDS’ links with the international financial system. The severing of this link can potentially wreck economic havoc on Caribbean countries’ economies by excluding them from the global financial system. A reduction of accessible financing for cross border transactions and of services for transmitting and authenticating payments has implications for the ability of individuals and businesses in Caribbean states to pay for and engage in the trade of goods and services across borders.

    The remittances business has also been a casualty of bank de-risking. Remittances are an important source of foreign exchange inflows to Caribbean economies, particularly in Jamaica and Guyana, where they are much more impactful than official development aid.  Remittances, which are usually sent through money transfer, are a lifeline for poor households which depend on monies sent by relatives living abroad to meet their daily needs.

    As a result of the high due diligence costs compared to the relatively low profits from remittances services, many banks see it in their best interest to simply sever their ties with money transfer operators in ‘high risk’ regions. In the Cayman Islands, which unlike Jamaica and Guyana is a net exporter of remittances, Fidelity Bank ceased its money transfer business with Western Union making it difficult for migrants there to repatriate remittances back to their families. Difficulties in receiving remittances due to higher fees or the unavailability of money transfer services compromise the financial well-being of dependent households and individuals, with implications for poverty reduction and eradication.

    Caribbean SIDS are not the only ones affected by de-risking policies. Last year it was reported that the Central Bank of Seychelles had to swoop in to the rescue of an offshore bank, the Bank of Muscat International (BMI) Offshore Bank after the Bank of China (Johannesburg) and JP Morgan months earlier ceased correspondent banking relations, making it unable to process outward foreign transactions. In war-torn Somalia where there is a high dependence on remittances banks have been ceasing money transfers to that country for fear of sanctions by the US government, with devastating consequences on dependents. Even charities and aid groups operating in ‘high risk’ countries have felt the brunt of banks’ de-risking policies.

    Global Recognition of the De-Risking Phenomenon

    In recognition of the de-risking phenomenon, the FATF has reiterated the risk-based approach to AMT/CFT on a case-by-case basis as opposed to the wholesale de-risking which many banks are doing. The Global Center has begun an exploratory study on de-risking in the financial services industry, while the World Bank has launched a survey of 19 member countries (excluding the EU) to assess the impact of de-risking on remittance flows. The findings are expected to be published later this year. This month the Financial Stability Board (FSB) released its report to the G20 on actions taken to assess and address the decline in correspondent banking.

    In the interim findings of its qualitative study on de-risking the G-24/Alliance For Financial Inclusion identified several drivers of de-risking and outlined several proposals for stemming the tide of de-risking.  Moreover, among the points highlighted by the recently held G-24/AFI Policymakers’ Roundtable on Financial Inclusion in Peru on the theme “Stemming the tide of De-Risking through Innovative Technologies and Partnerships” was that de-risking could have the unintended consequence of driving consumers to smaller informal providers, which only enhances the AML/CFT risk.

    Several Caribbean countries have sounded the alarm about the de-risking threat. Prime Minister of Belize, the Rt. Hon. Dean Barrow raised the issue in his speech at the Summit of the Americas, noting that “our financial and trade architecture cannot survive this phenomenon“. At the recently held Institute of Chartered Accountants of Barbados (ICAB) Conference, the Minister of Finance of Barbados, the Hon Christopher Sinckler, drew attention to the ‘fresh threat’ currently posed by bank de-risking to the international business and financial services sectors of Barbados and other Caribbean SIDS.

    The Bottom Line

    The threat posed to Caribbean SIDS by de-risking is real, with implications for trade, investment and remittances flows which are critical to the financial stability, inclusion and sustainable growth of regional economies. The worst part is that this is only just the beginning. A balance needs to be struck between AML/CFT regimes on the other hand with the interests of SIDS and their people to conduct business and transfer money on the other. Caribbean countries and other affected SIDS need to leverage their collective strengths to raise awareness about the real and negative fall-out of this phenomenon for their economies and the urgent need for international solutions to the issue of de-risking. Their survival depends on it.

    Alicia Nicholls, B.Sc., M.Sc., LL.B. is a trade and development consultant with a keen interest in sustainable development, international law and trade. You can read more of her commentaries and follow her on Twitter @LicyLaw.

  • Jamaica tops Anglophone Caribbean on ease of doing business in Doing Business Report 2016

    Alicia Nicholls

    Jamaica can boast of being ranked as the easiest place to do business among countries of the English-speaking Caribbean, according to the World Bank’s Doing Business Report 2016. Jamaica has an overall rank of 64 out of 189 economies surveyed in the report, improving seven places from a ranking of 71 last year. Jamaica was not only the highest ranked of the English speaking Caribbean countries but was second only to Puerto Rico (57) out of all Caribbean countries. Jamaica was also the only Caribbean economy ranked among the ‘top 10 improvers’ in terms of performance on the Doing Business indicators in 2014/2015.

    Now in its 13th year of publication, the 2016 edition of the Report entitled ‘Measuring Regulatory Quality and Efficiency’ ranked 189 economies globally on the ease of doing business based on 10 indicators which measure and benchmark regulations which pertain to local small to medium-size enterprises throughout their life cycle. The indicators were: starting a business, dealing with construction permits, getting electricity, registering property, getting credit, protecting minority investors, paying taxes, trading across borders, enforcing contracts and resolving insolvency. Although presented in the economy profiles, labor market regulation indicators are not included in the aggregate ease of doing business ranking this year.

    On two of the indicators Jamaica ranked among the top 10 economies globally, namely ‘ease of starting a business’ (9) and ‘getting credit’ (7, tied with Puerto Rico). Its lowest rankings were in regards to ‘trading across borders’ (146), ‘paying taxes’ (146) and ‘registering a property’ (122).

    Several reforms introduced by Jamaica during the 2014/2015 period were deemed to have made business easier including, streamlining internal procedures for starting a business,  implementing a new workflow for processing building permit applications, by encouraging taxpayers to pay their taxes online, introducing an employment tax credit, just to name a few. However, the introduction of a minimum business tax, the raising of the contribution rate for the national insurance scheme paid by employers and increased rates for stamp duty, the property tax, the property transfer tax and the education tax were viewed less favourably.

    The average ranking of Caribbean economies on the ease of doing business was 104. After Jamaica (9), the next three top regional performers were St. Lucia (77), Trinidad & Tobago (88) and Dominica (91). Haiti had the lowest rank among CARICOM countries (182), followed by Grenada (135) and St. Kitts & Nevis (124). Of note is Barbados which slipped 3 places from 116 in last year’s ranking to 119 in the 2016 ranking, making it the fourth lowest ranked CARICOM economy by ease of doing business. In regards to the region as a whole, the Report commended the region’s continued “remarkable progress” on reforms to resolve insolvency, including the new insolvency laws adopted by Jamaica and St. Vincent & the Grenadines.

    It should be noted that although no Caribbean country made it into the top 50 economies on the list, the region did well compared to most SIDS globally, with the notable exception of Mauritius which ranked a laudable 32. On average the Caribbean region ranked highest on ‘getting electricity’ (74), ‘starting a business’ (87) and ‘enforcing contracts’ (90), while scoring lowest in ‘registering property’ (144), ‘resolving insolvency’ (114), ‘paying taxes’ (112) and ‘getting credit’ (112). However, individual countries’ performance on each of these indicators showed great variance.

    While it has its limitations, the Doing Business Report, a flagship report of the World Bank, remains one of the best comparative measures of countries’ business environments. After all, it touches on many of the indicators which companies consider when seeking to invest in a foreign market. As such these rankings are and should be used by countries across the region as a guide to measure the success of their regulatory reforms, identify strengths and weaknesses of their business environments, and compare their countries’ business environment ranking regionally, globally and over a time period as they compete which each other for global investment inflows. While Jamaica’s over all performance is praiseworthy, what these rankings demonstrate is that there still remains great room for improvement if Caribbean countries are to become globally competitive as choice destinations for doing business.

    The full Doing Business 2016: Caribbean States Regional Profile may be accessed here, while the full Doing Business Report 2016 is available here.

    Alicia Nicholls, B.Sc., M.Sc., LL.B. is a trade and development consultant with a keen interest in sustainable development, international law and trade.

  • New Canadian Government Presents New Opportunities to Strengthen Caribbean-Canada Relations

    Alicia Nicholls

    The Canadian Federal election campaign and the resultant election of a new federal government have barely made a ripple in news coverage here in the Caribbean. It is a curious fact given that in the words of former CARICOM Secretary General, Edwin Carrington, Canada has always been perceived as a ‘special friend‘ to the Caribbean. This friendship, of course, has endured through consecutive Liberal and Conservative governments, including under the outgoing Conservative-led Stephen Harper administration. Given the current recession in Canada, most of the debates during the 78-day long federal election campaign focused on domestic issues,while foreign policy topics centred mostly on the US-led anti-Islamic State coalition, the Syrian refugee crisis, the Keystone XL pipeline and broader US-Canada relations. Suffice it to say, Canada’s relationship with the Caribbean did not feature in the election campaign, nor was it expected to. In spite of this, the campaign platform of the majority elected Trudeau-led Liberal Party and its young charismatic leader’s call for a “more pro-active diplomacy”, do potentially bode well for enhancing Canada-CARICOM relations.

    Trade Ties

    One of the areas on which this relationship can be deepened is trade. The volume of two-way merchandise trade between Canada and the countries of the Caribbean is admittedly small. As stated in a report, Caribbean trade represents less than one percent of Canada’s total annual trade and as such it is not surprising that the Caribbean is not on the radar of Canada’s current trade priorities. On the flip side, Canada represents the third largest market for CARICOM goods trade, only behind the US and EU markets and CARICOM actually enjoys a rare trade surplus with Canada, helped by the Caribbean-Canada Trade Agreement – CARIBCAN.

    Inaugurated on June 15, 1986, CARIBCAN is a preferential agreement which gives one-way, duty free access for most goods exports originating from beneficiary countries in the Caribbean with the aim of enhancing Caribbean export trade and promoting their economic development. This agreement is limited to countries of the Commonwealth Caribbean namely: Anguilla, Antigua and Barbuda, Bahamas, Barbados, Belize, Bermuda, the British Virgin Islands, the Cayman Islands, Dominica, Grenada, Guyana, Jamaica, Montserrat, St Kitts and Nevis, St Lucia, St Vincent and the Grenadines, Trinidad and Tobago, and the Turks and Caicos Islands.

    There are several reasons why this current trading arrangement needs to be addressed and replaced by a free trade agreement. Firstly, as a non-reciprocal arrangement which favours only Commonwealth Caribbean countries, CARIBCAN is not compatible with the World Trade Organisation (WTO) non-discrimination rules (more specifically Article 1(1) of the GATT 1994 which deals with Most Favoured Nation (MFN) treatment) and has had to receive successive waivers from the WTO’s membership.

    Secondly, not all goods are afforded duty-free access under CARIBCAN. Those exceptions are products of HS Chapters 50 to 65 inclusive and products subject to MFN rates of duty which are more than thirty-five per cent (35%).Thirdly, CARIBCAN is limited to goods and does not include services-trade, which constitutes the crux of most CARICOM economies. Financial services and tourism are two major areas of services trade between Canada and the Caribbean. According to Caribbean Tourism Organisation (CTO) data, Canada is the region’s third largest source market of long stay arrivals, accounting for 12.3% in 2014, after the US (49.1%) and the UK (19.1%).  In regards to temporary movement of persons, Caribbean countries benefit under the Canadian Seasonal Agricultural Workers Programme ‘Farm Labour Programme.

    Fourthly, CARIBCAN does not provide rules on investment protection or promotion. Canadian companies are major investors in the Caribbean region, particularly in the area of financial services. Three Canadian banks have a strong presence in the Caribbean: First Caribbean (CIBC), the Royal Bank of Canada and the Bank of Nova Scotia. Caribbean low tax jurisdictions like Barbados are preferred domiciles for Canadian offshore businesses. However, only two CARICOM states (Barbados and Trinidad) currently have a bilateral investment treaty with Canada, while only Barbados, Guyana, Jamaica and Trinidad & Tobago have a tax treaty with Canada.

    Under the Stephen Harper government, Canada proactively expanded its trade and investment treaty network considerably, including the recently signed Trans-Pacific Partnership Agreement. CARICOM countries have traditionally not shown much interest in pursuing a free trade agreement with Canada but finally agreed to discussions on a free trade agreement to replace the CARIBCAN arrangement in the 2000s. After seven disappointing rounds of negotiations beginning in 2007, Canada decided to end the negotiations due to the lack of an ambitious liberalisation target by CARICOM. In March 2015, Canada acceded to CARICOM’s request to seek another WTO waiver for CARIBCAN (until 31 December 2023).

    The pros and cons of a CARICOM-Canada trade agreement have already been thoroughly discussed elsewhere. However, broadly speaking, a trade agreement would help create predictability for CARICOM-Canada goods trade and also allow for trade rules on investment protection, liberalisation and promotion and services trade (including mobility of skilled workers). CARICOM countries should use the election of a new Canadian government as impetus to re-engage with Canada on the negotiation and successful conclusion of a mutually beneficial trade and development agreement.

    Marijuana

    Another more ‘taboo’ area is the issue of marijuana. Trudeau has promised to legalise marijuana, a stark shift from the Conservatives’ stance. Jamaica has passed the Dangerous Drugs (amendment) Act which decriminalises possession of two ounces or less of marijuana and more recently, in May Jamaica’s University of Technology received a licence officially authorizing the cultivation of marijuana for scientific research. Under this new environment, there is scope for investment and cooperation between Canadian and Jamaica companies, researchers and research institutions on marijuana research, including medical marijuana, and marijuana-based products.

    Climate Change

    Due to shared values and common interests, Canada and the Caribbean have always had each other’s support on issues of a hemispheric and global significance. The Liberal Party Platform included a more pro-active stance on climate change and Mr. Trudeau repeatedly criticised Mr.Harper’s lack of leadership on climate change issues. This shift in Canadian climate change policy could be of benefit to the Caribbean small island developing states which are particularly vulnerable to the effects of climate change, including sea level rise, coral bleaching and rainfall variability. A Trudeau-led Canada therefore could be a power ally for the Caribbean in continuing global awareness of the vulnerability of SIDS to the effects of climate change. At the same time, some developed countries’ climate change mitigation policies and environmental taxes run the risk of directly or indirectly affecting developing countries. A recent example is the UK’s air passenger duty (APD), which had an adverse effect on Caribbean tourist arrivals from the UK and was mitigated only after much lobbying by Caribbean governments. As such, Caribbean countries will have to lobby to ensure that any climate change mitigation strategies implemented by the new Canadian government help but do not hinder the region.

    Development Aid

    Canada has been an important development partner for the region. Trudeau’s campaign pledge to boost Canada’s foreign aid is encouraging and it is likely that some of the aid initiatives implemented under the Harper administration, such as the Improved Access to Justice in the Caribbean, Judicial Reform and Institution Strengthening in the Caribbean project announced at the Summit of the Americas in April 2015 in Panama City, Panama  will be continued.

    Immigration

    Canada has traditionally had a pretty ‘open door’ immigration policy, of which the Caribbean has been able to benefit. The Harper administration saw the introduction of several controversial measures which Trudeau criticised during the campaign. Caribbean immigrants in Canada have contributed to Canadian society in a variety of fields, including the highest corridors of government. The Haitian-born Michaelle Jean, former Governor General is just but one example. It should be noted that there are Canadians living in and contributing to the Caribbean as well. Trudeau’s platform includes a number of policies aimed at reforming Canada’s immigration policy and includes policies promoting family reunification, restoring the maximum age of dependents and repealing aspects of Citizenship Act under Bill-C-24 which he argued created “second class citizens”.This is encouraging for Caribbean immigrants living and contributing in Canada.

    Taxation

    There is however one area of concern. In a marked shift from Harper’s tax policy, Mr.Trudeau has proposed a middle class tax cut financed by raising taxes on the ‘one percent’ and corporations. Canadian tax policy is of importance to offshore financial centres in the Caribbean, especially Barbados which has traditionally been one of the most attractive jurisdictions for Canadian businesses due to its low taxes. There has been concern that Canada’s widening network of tax information exchange agreements has undermined the attractiveness Barbados has had to Canadian businesses. In an effort to boost revenue collection, it is likely that there will be greater emphasis by a Trudeau administration not just on tax evasion (which is illegal), but also tax avoidance (which is legal), including Canadian companies’ use of Caribbean low tax jurisdictions for more efficient tax management. As such, this is something which Caribbean offshore jurisdictions will have to monitor closely to ensure they are not unfairly branded or punished as ‘tax havens’.

    The economic challenges Canada currently faces, exacerbated by low oil prices and sluggish global growth, will all ultimately determine the new Canadian government’s trade and foreign policy priorities. In spite of this, Canada and the Caribbean’s ‘special’ friendship has been embraced by successive Canadian governments, including under Mr. Harper. Given the tone of Mr. Trudeau’s foreign policy campaign rhetoric, it is unlikely this will change. While not specifically directed to the Caribbean, Mr. Trudeau’s campaign policy proposals appear promising for Canada-Caribbean relations and the many Caribbean descendants living in Canada. They potentially provide scope for greater Canada-CARICOM engagement in a variety of fora, something which Caribbean leaders should continue to actively promote.

    Alicia Nicholls, B.Sc., M.Sc., LL.B., is an international trade and development consultant with a keen interest in sustainable development, international law and international relations.

  • Securing better statistical data for better Caribbean lives: Reflecting on the data problem in the Caribbean

    Alicia Nicholls

    Statistical offices and associations across the Caribbean will join those around the world this coming Monday October 20 in celebrating the annual UN World Statistics Day which aims to highlight the importance of statistics in shaping our societies. This year’s theme “Better data, better lives” caused me to reflect on two things which caught my eye in the news in recent weeks. The first was the non-inclusion of Barbados in the World Economic Forum’s Global Competitiveness Report 2015/2016 due to the lack of available data. This point was raised by one of our veteran journalists in an article. The second was the description by the Director of the Caribbean Export Development Agency of the lack of data for the region in order to assess the competitiveness of regional exports as “embarrassing”.They got me thinking yet again on this vexing data problem in the region and the serious development implications of this status quo.

    The Caribbean’s data scarcity problem

    A report coming out of an ECLAC workshop in 2003 succinctly sums up the data problem in the region:

    Generally, the Caribbean countries have been described as “data poor” and in the absence of data and information, policies adopted and implemented have been arrived at on the basis of little or no data and less information. The result is years of wandering in the wilderness of development – talking of visions of the promised land of development without the ability to measure proximity to that goal.

    Years later, the data problem repeats itself. Too many reports mention data shortages in regards to the Caribbean; data is often either missing for some indicators or some years. Barbados’ embarrassing omission from the Global Competitiveness Index ranking in the WEF’s Global Competitiveness Report for 2015/2016 due to the absence of data is just one of the latest examples.

    Obstacles to data availability

    The ECLAC report quoted above notes that obstacles to data availability in the Caribbean region include the following:

    • Lack of financial resources, ‰
    • Lack of qualified personnel, ‰
    • Lack of institutional capacity, ‰
    • Lack of coordination between departments, ‰
    • Low priority on the political agenda

    As a researcher, I can certainly add more than my two-cents’ worth of frustration at the difficulty and in many cases, futility, of trying to obtain data from official and private sector sources here in Barbados and elsewhere in the region in a timely fashion. This is not to cast aspersions on any of these actors. After all, there are occasions where I have gotten good data and assistance from willing staff in government departments/agencies, private sector  associations and from businesses for studies I have had the fortune of working on. But sad to say, there are many occasions where this is the exception and not the rule.

    Central Statistical Offices (CSOs) are financed primarily by government budget resources and in some cases have been receiving declining budget allocations as cash-trapped governments in the region seek to minimise government expenditure. As a result, the human resource and finance constraints of CSOs often limit their capacity to collect data or to process data requests from the public in a timely manner. This often leads to long waiting times for accessing data.

    Outside of initiatives like CARICOMStats, there are few online national or regional statistical databases to draw on. The few which exist are often outdated or limited in the datasets available. The best sources for online data in the region still tend to be international databases. There are good data-rich studies which have been conducted which have been commissioned by public or non-state entities but these findings are often not published or are disseminated only to select stakeholders.

    Data scarce or data scared?

    This brings me to a question I often ask; is it only that we are data scarce or are we also data scared? In the Caribbean there is a possessiveness with which we guard data. There is still the archaic mentality among some public and private actors that power requires cornering knowledge, while data sharing weakens power positions. Due to the silo mentality that pervades many of our civil services, there is often limited data sharing between government agencies and there are instances of more than agency collecting the same data. On the flip side, data collection by government agencies is often constrained by non-cooperation by some members of the private sector and the public in providing data to these agencies in a timely manner. Many businesses in the region do not like to complete surveys and/or are extremely guarded about what data they provide to third parties, with or without a confidentiality agreement.

    Often times, therefore, the only way to obtain data in the region is if one knows a contact in a government agency or has a personal rapport with the business owner from which data is requested. Indeed, what needs to be recognised is that data sharing empowers all. It empowers the data sharer, the data gatherer and the ultimate end users (e.g. the policy makers), as well as the beneficiaries of any policies which the data has been used to support and develop. While there are legitimate data security concerns particularly in regards to sensitive data, this should not be used as an excuse to deny data for legitimate goals.

    So what’s the big deal anyway?

    The data situation in the region is one that has many sustainable development implications. The main end users of data are not just governments, but businesses, NGOs and the citizenry in general. The availability of reliable, accurate and timely statistics is needed for evidence-based planning, evaluating and monitoring of policies and programmes at all levels of government, business and civil society, which ultimately impacts on the society at large. For instance, how can we formulate effective poverty eradication policies if we do not have accurate data on the scale, nature and complexity of the poverty problem? How do we know that the targeted interventions to grow premature sectors of our economies are working if we do not have enough data on which to conduct a proper impact assessment? In many cases, as pointed out in the quote above from the ECLAC workshop report, we are making policies, decisions and formulating plans in the dark. How often have you heard public officials give reports on policies or problems but caveat them by saying “(recent) data is not yet available” or something else to that effect?

    What needs to be done?

    We in the Caribbean region know and acknowledge we have a data problem. What then are the possible solutions?

    • Firstly, we need to strengthen the capacity of our national statistical systems and primarily our CSOs. Our governments must provide CSOs with enough financing and qualified staff so they can effectively and efficiently carry out their functions of collecting, interpreting and providing us the public with timely, accurate and reliable data.
    • Secondly, a frequent complaint is that there are not enough people in the Caribbean region trained in statistical methodologies and technologies. We need not only to continuously train existing CSO staff in these methodologies and technologies but to encourage young people to get into the field of statistics. Statistics is often not seen as a particularly “sexy” or lucrative field like say law or medicine. But this can be changed. Many countries offer national scholarships for development purposes. Why not identify statistics as one of the areas eligible for these scholarships?
    • Thirdly, a big problem in our civil service, and our societies, is the endemic phenomenon of silos; various government agencies collecting the same data or not sharing data with each other. We need an integrated data collection and sharing approach among the various government agencies, coupled with greater linkages with the industry stakeholders. Key to this is more communication about the kinds of data needed, agreed methodologies and standards, and the mechanisms for reporting findings to stakeholders.
    • Fourthly, we must change the fear, skepticism and power attitudes many of our government officials and private sector actors have regarding data sharing through greater statistical advocacy. And while we are still on the topic of changing attitudes, our policy makers need to appreciate the importance of evidence-based (and not gut-based) decisions and evaluations.
    • Fifthly,it would be good to know how many countries have actually amended their statistical legislation to take into account the changes as proposed in the CARICOM Statistics Model Bill.

    This World Statistics Day 2015 themed “Better Data, Better Lives” should be a catalyst for our governments, CSOs, private sector and all our people to reflect critically on the importance of statistical data for creating better lives for us all in the Caribbean region. We know the data problem, the implications of it, and we know the solutions. These proposed solutions herein stated are not novel. They have already been posited by many others.

    Looking at the regional landscape there are several initiatives at the CARICOM level which are quite encouraging and are aimed at tackling the previously mentioned data challenges. Many of these initiatives are being done through technical assistance and capacity building programmes with the help of regional and international development partners. In his speech marking the 7th CARICOM Statistics Day 2015 on October 15,CARICOM Secretary General Irwin LaRocque urged member states to invest in improving their statistical production in order to assist with development. He also outlined the work of the Standing Committee of Caribbean Statisticians which has reportedly recently endorsed an action plan identifying the support needs of the region’s central statistical offices. In his key note address at the Second High Level Advocacy Forum on Statistics, in May 2014, the Hon. Dr. Keith Mitchell, the Prime Minister of Grenada, highlighted not only that statistics should be seen as the voice of the people but also reiterated the importance of a regional approach to statistical development and of ICT in the data revolution.

    The data shortage problem is on the regional agenda. What we need to do is to get serious about implementing these solutions at the national level and a big part of that starts with political will and cooperation from stakeholders.

    Alicia Nicholls, B.Sc., M.Sc., LL.B., is an international trade and development consultant with a keen interest in sustainable development, international law and international relations.