Daily Archives: December 16, 2020

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China is in no way a newcomer to the Caribbean in terms of providing development assistance: Beijings first foreign aid project in the Western Hemisphere was a brick factory in Guyana built in the 1970s. More recently and much more substantially, it has been estimated that over the last two decades, Chinas policy banks have provided close to $9 billion in lending to the states of the Caribbean Community states (CARICOM), with the overwhelming majority of these loans coming from the Export-Import Bank of China (Ex-Im Bank).

The Caribbean has received less attention than most other regions in terms of the evaluation of Chinese lending practices. This is ironic in that the Caribbean could have served as the canary in the coal mine of Chinese lending long before the Belt and Road Initiatives (BRI) Hambantota port debacle in Sri Lanka came to light and governments began to reconsider their relations with Chinese President Xi Jinpings signature global initiative.

Nevertheless, despite its history, the region continues to be susceptible to Chinas largess in light of the perceived lack of alternatives and the view of hard infrastructure development as a panacea that (incorrectly) can ultimately resolve the Caribbeans deep and long-standing economic challenges. Just last year, following its shift of official recognition from Taipei to Beijing, Luis Gonzlez, director of Asia and Oceania relations at the Dominican Ministry of Foreign Affairs, stated that overall Chinese investment in the country would reach $10 billion over the coming years.

The Caribbean was the first region to experience what have become the main critiques of BRI lack of transparency, white elephant projects, ignored environmental concerns, investments long on promises and short on results, etc. even before BRI was launched in 2013. Guyana provides a useful case in point.

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The Chinese firm Baishanlin International Forest Development set up shop in Guyana in 2007, having signed an agreement to establish a $100 million wood processing plant, promising local job creation in the timber-rich country. The plant was never built. The Guyanese authorities ultimately announced that it would repossess all of the firms 627,072 hectares of forestry concessions while the Guyana Revenue Authority seized some corporate assets, noting a failure to pay import taxes. Former Guyanese auditor general Anana Goolsarran noted what are now standard outcomes of Chinese win-win investments, namely that the firm had not met requirements for the requisite permits and had not demonstrated the necessary technical and financial qualifications, nor any history of compliance.

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In the area of infrastructure, Chinas Cheddi Jagan International Airport project in Guyana has become something of regional legend. Construction started in 2012 and was supposed to last for 32 months; eight years later and it has yet to be completed. The project is being built by the China Harbor Engineering Company (CHEC), the same company that built the equally problematic North-South highway in Jamaica an initiative that ended with a portion of the outstanding loan being repaid by the transfer of 1,200 acres (485 hectares) of land. With a typical aversion to transparency, the project was shrouded in secrecy; local Guyanese media only found out about the deal from a Jamaican news source. (CHECs regional headquarters is in Jamaica.)

CHEC was also permitted to bring in 60 percent Chinese labor for non-technical work and an entirely Chinese workforce for technical aspects. Public contract tenders and open bidding were non-existent. In September of this year, Guyanas new president, Irfaan Ali, with Chinese ambassador Ciu Jianchun in the room, finally let rip and declared that Guyana had had enough: I am holding everyone responsible; the contractor, the consultant, the project management team, he said. This is not acceptable for the Guyanese people. In this current position it is very clear from all that I have seen and heard, and from all the questions asked, it is very clear that something is horribly wrong. The right decision at this moment is that we cannot accept this.

While Beijings model as a supplier of investment and infrastructure in the Caribbean has been deeply problematic, its approach does respond to real demand side issues, i.e., the yawning gap Caribbean states confront in terms of how to fund infrastructure development. The Caribbean Development Bank (CDB) estimates that need to sit at around $20 billion, with similar numbers from the Inter-American Development Bank (IDB). It is also true, in light of the regions relatively small size, that BRI could fund and Chinese state-owned enterprises (SOEs) could perhaps build all of it.

Thus, in the absence of major new lending from other sources, a significant number of Caribbean countries have already joined BRI. Trinidad and Tobago first came on board in May 2018, followed by Antigua and Barbuda, Barbados, Cuba, Dominica, the Dominican Republic, Grenada, Guyana, Jamaica, and Suriname. In June 2018, one month after joining BRI, Trinidadian Prime Minister Keith Rowley frankly and ominously described the terms of the relationship: We told them we need your investment and you need our location in the Caribbean. Former Guyanese President David Grainger, despite his own countrys less than ideal experiences with Chinese lending, had stated before he left office earlier this year We cannot develop without infrastructure and we just do not have the capital to do it on our own. So, whether it comes from America, China or Britain we have to have it, and of course we have to look for the best deal.

The primary question for the Caribbean as to its future economic engagement with China in general, and with the BRI in particular, is one that has been raised in other parts of the world: whether debt traps will be created. The debt-trap diplomacy narrative, the most prevalent critique of BRI, has somewhat diminished in recent years. As more data have become available, it has become clearer that debt traps are not an inevitable outcome of BRI. However, they remain a genuine concern and perhaps no place more so than in the Caribbean.

In the context of the region, the realities are stark. Even with concessionary loans, these economies are not productive enough; do not grow fast enough; and do not have sufficient fiscal capacity to sustain a new influx of Chinese lending.

Even before the COVID-19 pandemic, the regions GDP growth hovered around a distinctly sub-par 0.8 percent; meanwhile, more than two-thirds of Caribbean states have a debt-to-GDP ratio of over 60 percent. In many countries, nearly 20 percent of government revenue already goes to debt repayment. Since 2010, St. Kitts and Nevis, Antigua and Barbuda, Barbados, Belize, Grenada, and Jamaica (twice) have defaulted on and restructured their debts. Across the board, it is important to note that these small island economies have very small GDPs Antigua and Barbuda comes in at $1.6 billion; Grenada at $1.2 billion; and Barbados at $5.2 billion which inherently casts doubt on the feasibility of paying back future loans in the hundreds of millions of dollars.

At the same time, the Caribbean remains a difficult region for entrepreneurship and trade in general. According to the Ease of Doing Business Report, the highest ranked Caribbean country is Jamaica at 71 followed by St. Lucia at 93. While Chinese loans come with the promise of economic diversification, the realities on the ground indicate that infrastructure development will not be remotely sufficient to facilitate either that outcome, or the promised increases in GDP growth. There is little reason to think Chinese loans could be paid back without becoming a burden.

Caribbean governments must be ruthlessly strategic in how they select infrastructure projects and with whom they partner. These projects must be of the sort that increase the earning capacity of the economy at a level that does not increase the debt burden a difficult hurdle to surmount. At the same time, the governance standards of Caribbean states have been lackluster. When you couple this endemic problem with the availability of Chinese loans untethered from rigorous requirements around transparency, distributional management, and supervision, the inevitable result is poor performance and unsustainable debt.

Recognizing these challenges and the questions as to how the Caribbean will move forward, one aspect that is generally overlooked is that China is a non-borrowing member of the CDB, unlike the United States which is not part of institution. As a donor member of the CDB, China has the opportunity in the Caribbean to test out real engagement with other multilateral partners. In 2017, the CDB signed a MOU with Chinas Ex-Im Bank in order to coordinate lending. While that agreement has not resulted in significant progress, if Beijing is serious about becoming a responsible partner among the global community of donor states, demonstrating that in the Caribbean via real cooperation with the CDB and CARICOM would be a good place to start. After all, the region was the first victim of irresponsible Chinese lending and investment practices it is certainly the logical place for Beijing to begin to make amends and demonstrate that BRI can adhere to best practices and coordinate with, rather than, compete against other institutions while providing real win-win outcomes for less developed countries.

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Bradley J. Murg, Ph.D. is Senior Advisor and Distinguished Senior Research Fellow at the Cambodian Institute for Cooperation and Peace.

Rasheed J. Griffith is a Consultant at Kelman PLLC, based in Bridgetown, Barbados.

This article is the second of a three-part series about Chinas investments in the Caribbean. The first part is available here.

Original post:

An Ignored Canary in an Unknown Coal Mine: The Caribbean's Economic Engagement with China - The Diplomat

There are, as far as we can tell, a pair of Pirates of the Caribbean movies currently in early development. One is being written by Birds of Prey scribe Christina Hodson and is set to star Margot Robbie, while another is being handled by screenwriters Ted Elliot and Craig Mazin. While neither projects was set to star Johnny Depp's character, it was unclear if the plan for one, or both, of these movies was to be true reboots, starting the story off from scratch in an entirely new universe, or if they might be more like spinoffs, that simply focused on new characters within the same world as the previous films. Some fans of Captain Jack hoped that If it was the latter, then there was at least a chance that Depp might appear, even if he wasn't the main character.

More here:

How The Pirates Of The Caribbean Reboot Had Hoped Johnny Depp Could Make A Cameo - CinemaBlend

The U.S. Virgin Islands receives top accolades.

[U.S. VIRGIN ISLANDS] The U.S. Virgin Islands has received the Destination of the Year award from Caribbean Journal, a leading digital travel news publication.

The USVI captured the top spot in the 7th edition of the Caribbean Travel Awards, while The Ritz-Carlton St. Thomas was named Caribbean Hotel of the Year.

The luxury resort, which reopened in November 2019 following a period of extensive enhancements after the 2017 hurricanes, was recognized for its continued high level of service despite the challenges presented by the Coronavirus Disease 2019 (COVID-19) pandemic. It was also lauded by Caribbean Journals editors for setting a new standard for health, safety and Caribbean hospitality in the process.

These accolades from Caribbean Journal validate the passionate efforts of our entire team as we continue to work around the clock to promote safe travel and to welcome visitors to our islands, said Joseph Boschulte, Commissioner of Tourism of the U.S. Virgin Islands. As we continue to carefully navigate the pandemic, we are very hopeful to see a full rebound of our bread-and-butter tourism industry in 2021 and beyond.

The U.S. Virgin Islands was acknowledged for being a model for tourism reopenings around the region, launching a region-leading travel portal and a new brand campaign for St. Croix, while rekindling interest in hotel development, which is taking place under the leadership of Governor Albert Bryan Jr.; Lieutenant Governor Tregenza Roach; Commissioner Boschulte; and Wayne Biggs Jr., CEO of the Virgin Islands Economic Development Authority.

Read the original post:

U.S. Virgin Islands Named Caribbean Destination of the Year - South Florida Caribbean News

Significant demand was born as a result of Royal Caribbean Internationals announcement for the search of volunteers to go on its first test sailings prior to returning to sea in the U.S.

So much that a form has been created to sign up, which saw more than 150,000 hopeful cruise lovers leave their details.

It's a good feeling knowing that so many people want to get back on ships, said Vicki Freed, senior vice president for sales, trade support and service at Royal Caribbean International, on Dec. 8 in response to the demand.

The company has also launched a website for potential volunteers to sign up.

Cruise Industry News breaks down what is known about the sailings.

What are they?

The test sailings are part of thenew Conditional Frameworkby the CDC, which came in place of the "No Sail" order. They will include the company having a number of trial cruises using employees and volunteers as stand-in passengers to test safety and health protocols.

Trial sailings are said to be monitored by company officials, a third-party class society, as well as the CDC.

When will they take place?

Likely the first quarter of 2021, possibly even January. Heres a quote from Freed at Virtually Yours forum organized by Cruise Planners:

We don't know exactly when the test sailings are going to happen we think in Q1, and we're hoping for January.

Which vessels will be taking part?

Industry sources previously stated that they expect the Mariner and Navigator of the Seas, the company's recently-refurbished "short Caribbean" ships, to be the vessels pressed into service.

On what itineraries?

Freed said in November that the first cruises will be short sailings to CocoCay, which would allow the company to operate in a bubble on its own private island.

Who gets to go?

More than 150,000 people signed up, according to Royal Caribbean International, so it will be tough to choose from them. Apart from cruise line workers and CDC staff, the cruise line is likely to choose volunteers among its most loyal customers.

"We haven't figured out our protocols yet for the volunteers but certainly loyalty status will be a key selector," said Michael Bayley, Royal Caribbean Cruises president and CEO during the International Cruise Summit that took place on Dec. 1-2.Our top tier has the name of Pinnacle and they've cruised with us a gazillion times they'll be amongst the first to receive the invitation."

Freed said on Dec. 8 that the companys travel partners will be invited, too.

What about safety?

Royal Caribbean is working on ensuring they are conducted safely and in compliance with the regulations.

While we review the requirements proposed by the CDC and consider when we can host our simulated trial sailings, we are gathering information from those who have shown interest on our Volunteers of the Seas Facebook page. Our priority is to ensure that we can exercise our comprehensive set of measures in a safe and healthy manner while making sure we provide a memorable vacation experience, Royal Caribbean said in a statement.

Yet a lot of information is still to be released about the sailings.

We will be announcing more as we get more information, Freed said. So, we look forward to it; we're looking forward to it.

Read more:

What We Know About Royal Caribbean's Free Test Cruises - Cruise Industry News