Caribbean central bankers meet in Belize

Over the next four days, representatives of central banks and other monetary institutions from the Caribbean will be in Belize to discuss financial issues affecting the region. The thirty-third annual monetary studies conference is being held under the theme, “Money, Economic Growth and Development in the Caribbean”. Some sessions will focus on the effects of recent world events, while the perennial fiscal and trade deficits of the participating countries will also be high on the agenda. With a public sector debt of over a billion dollars, Belize’s Governor of the Central Bank, Keith Arnold, says it’s time for the private sector to step up and start making some serious investments.

Keith Arnold, Governor, Central Bank

“We also need to make sure that we invest in the productive sector, especially those sectors that earn foreign currency, because we have to earn foreign currency in a small open economy that we have to almost import everything, relatively speaking. And consequently, we have to earn that, because the only way we can finance that, is to finance it with earning foreign currency. Foreign currency is U.S. dollars, we have to find a way to increase earnings of foreign currency.”

On the issue of dollarisation in Belize, Arnold says it’s an option Belize should not be considering given the low success rate for other for other countries who have tried it.

Keith Arnold

“Dollarisation is not an option because although it is attractive to a lot of business people who believe that they will get the foreign currency when we have dollarisation, we have to earn it. So it’s not a cure for all situations, and not only that, it limits our options. It limits monetary policy options, and I’m not sure the political directorate will go for it. Normally, countries that cope with dollarisation really run out of range of alternatives, before they go to dollarisation, because it’s almost an irreversible situation. And so consequently in my view, I don’t think we should go toward dollarisation. But that’s just my personal opinion.”

The highlight of the conference will be the Adlith Brown Memorial Lecture. This year’s speaker will be Professor C.Y. Thomas, Director of the Institute of Development Studies at the University of Guyana, giving a thirty year retrospective of monetary studies. The lecture will be held at the Princess Hotel State Room on Wednesday night at 7:00.