Medium-term challenges and the shaping of a post-2015 development agenda in the Caribbean

1. Medium-term challenges and the shaping of a post-2015 development agenda in the Caribbean Alicia Bárcena Executive Secretary ECLAC, United Nations Georgetown, July 11 Sixteenth meeting of the Monitoring Committee of the Caribbean Development and Cooperation Committee

2. Slower growth of global economy affected regional trade LATIN AMERICA AND THE CARIBBEAN: ESTIMATED CHANGE OF THE VALUE OF EXPORTS ACCORDING TO THE CONTRIBUTION OF VOLUME AND PRICE, 2011 y 2012ª (In percentages) Source: Economic Commission for Latin America and the Caribbean (ECLAC), based on official figures. a Figures for 2012 correspond to estimations.

3. Tourism performs at low rates LATIN AMERICA AND THE CARIBBEAN: YEAR-ON-YEAR CHANGES OF INTERNATIONAL TOURIST ARRIVALS, 2009-2012 (In percentages, three month moving average) Source: Economic Commission for Latin America and the Caribbean (ECLAC), based on figures from the World Tourism Organization (UNWTO).

4. The current model is unsustainable • The crisis is questioning the dominant model, and thus an opportunity to chart a new course • A model associated with two decades of high wealth concentration • Sporadic actions against environmental degradation are not enough for building long term resilience • For the region, this means facing up to its historical and more recent challenges: • Worst income distribution in the world • Increasingly heterogeneous production patterns • Segmentation of the labour market and social protection • Racial, ethnic and gender discrimination • Asymmetrical vulnerability to climate change

5. Where is the Caribbean today: risks and challenges Classified as high, middle- income economies except Haiti Severely affected by the crisis of developed countries Vulnerable to natural disasters and climate change Mixed situation in respect of fuel, food and finance Graduating from concessional financing and preferential trade although inequities remain Highly indebtedness with decreasing investment Rethinking its development models with more innovation and diversification Needing a structural change for equality and environmental sustainability Inadequate governance structrures – the case of depotees back to the Caribbean

6. LAC is predominantly a middle-income region: 85% of all countries fall in that category PERCENTAGE OF COUNTRIES FROM EACH REGION CLASSIFIED AS MIDDLE-INCOME Only five of all 33 countries in the region are not classified as middle-income: 1 is low-income and 4 are high-income. Porcentajes del total

7. In 2012 the region GDP was 3.0%, and similar rates are expected for 2013 and will be better for Caribbean countries LATIN AMERICA AND THE CARIBBEAN: GDP GROWTH RATES, 2012 (Percentages) Source: Economic Commission for Latin America and the Caribbean (ECLAC), based on official figures.

8. While unemployment fell in the region, the Caribbean has suffered significant increases URBAN UNEMPLOYMENT RATE, 2008 - 2012 (Percentage) REST OF SOUTH AMERICA BRAZIL CARIBBEAN MEXICO CENTRAL AMERICA Source: Economic Commission for Latin America and the Caribbean (ECLAC), based on official figures.

9. Caribbean tax burden is higher than Latin American countries… CARIBBEAN: TAX INCOME, 2011 (As percentge of GDP) Source: Economic Commission for Latin America and the Caribbean (ECLAC), based on official figures.

10. Towards a sustainable development agenda in • the Caribbean with equality at the center

11. New paradigms are needed: structural change for equality and sustainability • Economic growth is necessary but not enough • Social protection necessary. Of the 3 dimension of SD, least emphasis is placed on the social aspect • Open economies require deliberate industrial policies to increase productivity, value-added jobs & universal social protection • Addressing persisting inequalities should be the basis of economic and social policies • Real gender parity should be based on economic autonomy • Neither State-centric or market-centric: need for more equilibrium • Social and fiscal pacts for the collective provision of public goods

12. The UN Post -2015 Agenda Provides a Broad Development Framework • The report of the High-level Panel provides broad useful guidelines for rethinking development • It moves beyond the MDGs by stressing the need to integrate economic, social and environmental aspects of development into a coherent strategy • The High-level Panel proposed five transformative shifts to promote sustainable development: • Leave no one behind; • Put sustainable development at the core; • Transform economies for jobs and inclusive growth; • Build peace and effective, open and accountable institutions for all and; • Forge a new global partnership for sustainable development. However, the report does not address the special circumstances of SIDS

13. A Global Partnership must recognize special needs of middle-income SIDS • Caribbean countries seek to ameliorate five key challenges: • Their structural vulnerability to economic and financial shocks; • Their graduationfrom soft development financing based on middle income status; • The increasing threat that SIDS face fromclimate change and natural disasters and more recently; • A mounting debt burden , low investment • Growing inequalities and unemployment

14. The Caribbean must carve a reform Agenda based on SIDS Plan of action • To tailor the development agenda to its needs, the Caribbean requires a reform agenda based on SIDS framework • The SIDS framework would provide the platform for integrating the economic, social and environmental issues(the Triad) into a single coherent Sustainable development vision. • Regional integration: new concept of intra-regional trade of intermediate goods and services

15. Development Vision should be built on Four Key Pillars • Dynamic Structural transformation for inclusive/pro-poor growth; • Regional integration to leverage opportunities and reduce risks; • Full operationalisationof the Caribbean Single Market and the Economy • Social protection for improved equity and capability building and; • A global partnershipfor prosperity

16. Integration with convergence is key to build resilience • Boost regional trade, investment and functional cooperation to their full potential; • Provide a training ground for firms to learn the ‘’tricks of the trade’ to penetrate international markets; • Act as an improved mechanism for foreign policy coordination; • South-South and SIDS-SIDS cooperation in trade, energy, food security, adaptation to climate change and technology • Complementarities between regional and subregional institutions: convergence between investment, trade and cooperation

17. Social equality and economic growth are not mutually exclusive • Growth with equality; equality as a driver of growth • With macroeconomic conditions that mitigate volatility, stimulate productivity and favour inclusion • With production patterns that close internal and external gaps • Promoting equality by building human skills and actively redressing disparities • Universalizing rights and social benefits • Fostering inclusion through the labour market • Achieving territorial convergence • Environmental sustainability, with changing patterns of consumption and production • With a smarter and stronger State capable of redistributing, regulating and supervising

18. A readingof thepost-2015 agenda • Stay focus on the remaining gaps to achieve the MDGs • New and old challenges call for a new development model based on a structural change for equality with a rights-base approach • Increased labor productivity with decent jobs and universal access to social protection. • Link education with employment • Environmental sustainability with full internalization of costs. • Policy and institutions matter: Rule of Law regulation, taxation, financing and governance of natural resources with a new equation State, market and society • Sustainable development goals need convergence, careful sequencing after 2015, to move beyond the minimum goals to universal goals on fair trade, technology transfer and international financial reform

19. Towards the future we want in Latin America and the Caribbean • Fulfillment of MDGs: necessary condition, but not sufficient • From basic needs to filling structural gaps • Fundamental to ensure national and international enabling conditions/goals • Move from national- and developing-countries-oriented targets to universal objectives and with revived metrics • The post-2015 development agenda requires a global financing and technology transfer pact • Needs to consider the vulnerabilities of SIDS • Concepts with a long-term, rights-based approach • The goal: more resilient, self-sufficient and balanced economies

20. A Forum is required to keep Development issues centre stage • We propose that the Caribbean Development Roundtable (CDR)is the ideal forum for this purpose • The CDR is a High Level Development Forum that brings together experts from the public and private sectors and civil society to: * Discuss development Challenges and Opportunities in the Caribbean * Provide practical recommendations that could be considered for implementation by policy makers

21. The CDR is the ideal Forum • The ECLAC Caribbean Office has launched two successful CDRs. • The last CDR was held in Guyana in 2012. • It focused on how the region could use macroeconomic policies to advancestructural transformation and social protectionin the Caribbean • It proposed a programme of radical restructuring to develop competitive exports and • social protection focused on investing in the skills and capacity of the poor