ECLAC Advocates for Debt Relief Proposal during Conference on Hurricane Striken Caribbean Held in New York

Representatives from the Economic Commission for Latin America and the Caribbean (ECLAC) presented this Monday 20 November the organization’s debt for climate adaptation swaps proposal for the Caribbean nations striken by the recent hurricane season, during a high level conference being held in the United Nations’ headquarters in New York until Tuesday 21 November.

The CARICOM-UN High Level Pledging Conference: “Building a more Climate Resilient Community”, was convened by the Caribbean Community (CARICOM), with support from the United Nations Development Programme (UNDP), and looks to mobilise international support for its Members devastated by Hurricanes Irma and Maria last September. Especially, financial and technical assistance support is being sought. The meeting was opened by CARICOM Secretary-General, Irwin LaRocque, and the UNDP Administrator, Achim Steiner.

It is expected that the conference will highlight vulnerabilities of the CARICOM SIDS (Small Island and Low-lying Coastal Developing States) and provide an opportunity for the affected countries to share a vision for achieving the ambition of becoming climate resilient nations.

CARICOM Heads of Government and the Secretaries-General of CARICOM and several United Nations’ organizations are participating in the meeting, along with international development partners, including countries, agencies, non governmental organizations (NGOs), prominent personalities, private sector entities and foundations.

The ECLAC delegation was composed of the Director of the Commission’s Subregional Headquarters for the Caribbean, Diane Quarless, and the Director of ECLAC’s Economic Development Division, Daniel Titelman.

In her speech, Diane Quarless paid tribute to the indomitable resilience of spirit demonstrated by the government and peoples of the countries devastated by the recent superstorms. She also described the actions taken in the five countries for which ECLAC conducted its Damage and Loss Assessments (DALA) methodology post Irma and Maria: Anguilla, the Bahamas, British Virgin Islands, Sint Maarten and the Turks and Caicos Islands.

“We are resolved to collect the data that present the most accurate picture of the degree of the subregion’s vulnerability to extreme climatic events”, she stated. “The most vulnerable are already facing the impact of climate change. It is estimated that 70% of the beaches in the subregion are losing shoreline at a rate of between one quarter and nine meters each year. This is more serious when you consider that about 70% of Caribbean populations, dwellings and infrastructure are situated on low-elevation coastal zones”, she added.

Quarless also emphasized that ECLAC has undertaken substantive research and focused economic assessments of the challenge which climate change poses to the economies of the Caribbean across a range of sectors, including agriculture, freshwater, health and tourism, providing a framework complete with data, parameters and other measures that can be used to inform economic policy dialogue in responding to this challenge over the medium term.

“It is for these reasons that ECLAC has been championing a debt for climate adaptation swap initiative; our contribution to addressing at once the crippling debt of the Caribbean economies and their need to generate the resources needed to finance resilience building measures”, Diane Quarless stressed.

Later, Daniel Titelman presented details of this proposal, based on the creation of a Caribbean Resilience Fund (CRF) which is expected to provide financing for investment in climate resilience, green growth and structural transformation in the economies of the region. This proposal, which was originally launched in late 2015, has already been put into consideration in several international forums.

The ECLAC official reminded that the total Caribbean debt burden mounted up to 52 billion dollars in 2015, representing more than 70% of the subregion’s gross domestic product (GDP). This debt has been rooted in external shocks, compounded by the inherent structural weaknesses and vulnerabilities, particularly extreme weather events. The accumulation of debt has been caused by increased expenditures to address the impact of these extreme events and climate change attendant difficulties, since most Caribbean countries are located in the hurricane belt and are also prone to earthquakes and other hazards, he explained.

On top of this, the ECLAC director warned that the upper middle and high income classification of the majority of Caribbean countries poses a number of challenges, among which the most important are limited access to concessional external finance and a decline on official develoment assistance (ODA) to the Caribbean. Also, GDP per capita criteria failures to take into account threats from natural disasters such as hurricanes as well as economic shocks.

In this context, ECLAC’s debt relief proposal for the Caribbean aims to help these economies mitigate and adapt to the consequences of climate change while trying to reduce the debt burden, increase growth and achieve the Sustainable Development Goals (SDGs) of the 2030 Agenda.