Caribbean Export OUTLOOK 3rd Edition

Pulse of the Caribbean

1980s, the smaller islands of the Caribbean outpaced the rest of the world. The four pillars of our economic growth model were: 1. Heavy investment in public education and health, paid for through taxation; 2. Preferential trade arrangements for the region's traditional crops that our export markets dismantled at a pace that was sufficiently slow that it was offset by the growth of new off-shore financial sectors; 3. A significant export of workers which reduced burdens on the state and created a sizable inflow of remittances; and 4. A safe and stable environment, amid an unstable world, which supported foreign investment. The Caribbean cannot continue to place its faith in what is now an outdated economic model.

The social and private returns from investments in public education and health initially increase, but once you move beyond universal schooling and literacy they start to diminish. Going from one graduate to two in every household will increase public expenditure but will not expand outcomes if those graduates do not have useful skills and jobs. Public funded education is vital, but simply more of what we currently do, no longer produces better results. Trade preferences have ended. In my opinion, their long continuation only made those preferred sectors less efficient. Once preferences were removed, many proved obsolete. Desperate attempts to keep these industries alive have cost much and delivered little. The major international financial centers have woken up to the competition from the Caribbean and have sought to undermine it through the selective use of money laundering