Posted: Friday, September 25, 2020. 10:30 am CST.
By Aaron Humes: Speaking virtually to a panel including Commonwealth Secretary-General Baroness Patricia Scotland and Chair of the Alliance of Small Island States (AOSIS), Ambassador Lois Young, Minister of State for Finance, Labour, Local Government etc., Senator Dr Carla Barnett said small island developing states (SIDS) must “be allowed our due” of affordable financial assistance and reducing the climate change burden on countries that have least contributed to it.
As Dr. Barnett reminded, countries like Belize contribute least to climate change but bear the worst of its effects, such as rising seas, bleached coral reefs and ever-intensifying storms and hurricanes.
Dr. Barnett painted a picture of a Belize reactive to global changes rather than proactive, citing the 2009 financial crisis that preceded the current COVID-19 one and the lingering economic effects of borrowing to rebuild after storms as far past as Hurricanes Keith and Iris two decades ago and as recent as Hurricane Nana three weeks ago.
Even repurposed loans for development projects and borrowing from the Central Bank can only take us so far, Dr. Barnett said, and the number of cases continue to climb, jeopardizing even the limited aspect of recovery promised by the return of tourists through the International Airport next week.
Yet pleas to the international financial institutions for a more thorough outlook, taking into effect the “debt of response” to natural and financial disasters have fallen on deaf ears, said the former Caribbean Development Bank (CDB) vice-president. As she put it, “In a global financial system that seems focused on maintaining the status quo, where do small, vulnerable economies turn? On whose door must we knock?”
She continued, “And yet, here we are, with little access to affordable assistance, with options that, if eventually negotiated, will offer help years from now when the truth is SIDS need help now. Help of a kind that recognizes our peculiar vulnerabilities; and help that is provided in keeping with the principles of justice: “every man his due”. In 2020, that is all SIDS ask of this system: allow us our due, including not expecting us to continue to pay the greater cost of the climate change brought on by others. We ask this not out of some need to entreat on morals but as a right accorded to all of us.”
The solutions tailored to countries like Belize, she said, “must include access to liquidity for all SIDS on grant and concessional terms. The Resilience Fund being scoped out by ECLAC holds much potential in this regard and requires serious and urgent attention from our international partners.
Our solutions must also include debt workouts with private creditor participation. This has probably been the most difficult of the topics on which to get any serious conversation going in the “Financing for Development” process. But the truth is, private creditors need to be willing to discuss helping heavily indebted SIDS across this COVID crisis if they want to help themselves back into a situation where our parts of the market can return to investment grade… Finally, our options must include debt for development and debt for climate swaps. And they must include economic recovery aligned with the Paris Agreement. To sidestep this imperative would be a disservice to all our future generations.”
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