In his belief that Guyana can be a model developed economy in Latin America and the Caribbean in the next five to ten years, newly-elected Inter-American Development Bank (IDB) President, Mauricio Claver-Carone says that he will do all possible during his tenure to facilitate achieving those goals in a transparent and sustainable manner, benefitting all Guyanese.
“The challenge is to ensure that the resources that are coming to Guyana are properly managed so that the future of Guyana and its people benefit, the growth of Guyana and its economy is sustainable in the long term and that everybody benefits in that regard. We provide a great amount of “know how” and we are ready to be in contact,” the newly-elected President of the development financing bank told a Caribbean round-table discussion last Friday, when asked by Stabroek News about the IDB’s role here in relation to the oil and gas sector.
Claver-Carone said that one of the greatest value-added attributes of the IDB is their need to help countries using the multinational wealth of knowledge in holistic economic and social developmental planning to achieve equality and equity.
“I think we can provide a great deal of assistance to Guyana, helping them, how do we shape and think through how do we use the new resources and how to use them for a sustainable future,” he said.
“My goal, I want Guyana to move from an emerging developing economy to a bold developing economy. That is what we want. It has the potential as the fastest growing economy in the world to be a model. It is the best case that can be made for an emerging developing economy to transition to a developed economy in Latin America and the Caribbean within the next five to ten years and I would do everything I can to make that happen,” he added.
With vast revenues projected from oil production over the next ten years from the offshore Stabroek Block alone, which to date has recoverable oil resources pegged at 9B barrels from 18 discoveries by ExxonMobil, Claver-Carone says that Guyana’s opportunities and success will ultimately benefit the entire region and it has to get its development agenda right.
“That will be a really big focus of my presidency of the next five years and if Guyana succeeds, I think that the region will succeed and will be a model to follow,” he said.
It is why the IDB plans to support the building of developmental infrastructure and institutional strengthening to create the development model and will facilitate this process through grants, technical assistance and loans.
Not only this country, but the region, the new IDB President reasons, stands to also benefit from the spin-off opportunities when this country prospers.
“Guyana, is something I take upon myself, as the great opportunity that the country has to manage new-found resources in a successful manner if Guyana is able to manage as the fastest growing economy in the world…if it is successfully able to manage that income, that finance it will be really the first emerging economy, first developing nation, first liberal democracy, to do so successfully,” he said.
Guiding light
“Obviously, the guiding light in this developing role is Norway but we have never really seen [this in the region]. [The IDB wants to see] this liberal democracy really succeed in managing that new-found wealth in a successful manner and in a manner that benefits the people of Guyana and it could soon become, in another couple of years, the largest economy per capita. And therefore, we want to ensure the entire country can befit from the success it can have, in that regard,” he added.
In his opening address on Friday, the IDB President echoed most of what he said in his first day as President, when he gave an address to the staff of the institution that Latin America and the Caribbean could not afford to lose another decade and that job creation along with an increase in capital were visions of work for his tenure.
“Where do we want to see Latin America and the Caribbean in 2025 and beyond? Bottom line: we cannot afford to lose another decade. We must overcome the immediate challenges of COVID-19, rebuild stronger economies, move aggressively into the digital space and be a leading example of creating new sectors for investment and growth. We must promote the ideals of América Crece [Growth of Americas initiative] – of mutual growth – to strengthen our ties as a region through nearshoring and greater investment; increase access to capital; expand fair and competitive wages; and boost affordable access to energy. These are all drivers of growth for us – for the Americas. The status quo is not an option. In this crisis, we have to dramatically improve our ability to stimulate the growth, progress and opportunity that the Americas deserve,” he had said on his first day.
When US Secretary of State Michael Pompeo was here last month, Washington and Georgetown inked a Growth of Americas pact for private sector investment in infrastructure.
Risk-taking
“The IDB of the 21st century must be innovative, and yes – risk-taking. It must be responsive to the ever-changing needs of the region. As an incubator of new ideas, the IDB has the potential to generate and catalyze private investment and revitalize our traditional development tools to accelerate economic recovery and growth in the region. In order to execute this vision, we will construct a strong executive team that fulfills the commitments that I made on September 12 – one of diversity, which will ensure that the voices of small countries are heard. We will focus on taking actions and delivering results. We will strengthen governance and transparency. We will build closer ties to the Bank’s Board, make structural changes to ensure efficient and effective decision-making, and focus on the IDB’s founding principle – whereby success is measured exclusively by the success of its borrowing countries,” he added.
Given the scale of the region’s problems, exacerbated by the global COVID-19 pandemic, he said that he was “convinced the IDB should increase lending from US$12 billion to nearly US$20 billion per year.”
Discussions on the capitalization have already been initiated, according to Claver-Carone who said that he will now formally begin the process in consultation with the Board. He said that he will also “mobilize support in the (US) Treasury Department and in the U.S. Congress, and will seek to conclude these efforts no later than by the next scheduled Board of Governors meeting in Barranquilla”, (Colombia).
Underscored too were expanding opportunities for employment through digitalization in smaller countries. For small underdeveloped countries like Guyana, where there is a deep divide between coastal and hinterland communities in terms of internet access, the IDB President said that investing to increase access to high quality, affordable internet connections, especially in rural areas, is critical to the future of the region and to job creation. He said seizing on transformational opportunities to create jobs in digitalization will be a cornerstone of his administration and of the IDB’s work.
“The IDB should be the leading edge of advancing connectivity in rural areas, and increasing its use for education, small business, banking, and financing. On entrepreneurship, small and medium-sized businesses will play a much larger role in the economic recovery,” he said.
Claver-Carone is the first American candidate to hold the Presidency of the IDB. The position is usually held by a Latin American candidate. There had been an attempt to delay the meeting to elect the IDB President as means of thwarting his candidacy. These efforts ultimately failed. Guyana was one of the countries supporting Claver-Carone’s candidacy.
