Describing a proposal for creating a “single economic space” as a “possible way forward” through “a dangerous phase” of the world economy, the Vincentian prime minister Dr Ralph Gonsalves urged more detailed work before the eight-nation ALBA bloc formed a new economic area.
Gonsalves was speaking late Saturday night at the opening plenary of the 11th summit of the eight-year-old Bolivarian Alliance for the Peoples of Our America (ALBA) whose formation was inspired by Venezuelan leader, Hugo Chavez.
The plenary session at the Palacio de Miraflores in the Venezuelan capital, which extended until shortly before midnight here (1220 East Caribbean Time Sunday) and was televised live, was an open and free-flowing roundtable discussion dominated by frequent, lengthy, off-the-cuff statements by Chavez and his Latin American counterparts.
“What we are proposing here is a possible way forward … not the only way forward but at least a possible way forward,” Gonsalves told the summit.
He stressed that he was not speaking for his Eastern Caribbean counterparts in ALBA, Dominica’s Roosevelt Skerrit and Baldwin Spencer of Antigua and Barbuda.
But the Vincentian leader and attorney-at-law said a proposal for an ALBA economic area required a “significant juridical framework” that needed to take into account other regional economic and monetary arrangements, including the newly-formed OECS economic union and the CARICOM Single Market (CSME).
Other leaders, including Chavez, and the leaders of Bolivia, Ecuador, Cuba and Nicaragua sat stony-faced, as Gonsalves appeared to depart from the general thrust of the discussion that supported the concept of an economic area.
The proposed economic area would emphasise bartering and a virtual currency, the Sucre, to enable inter-ALBA transactions as an alternative to payment in United States dollars.
Later describing Gonsalves as “ALBA’s lawyer”, Chavez acknowledged the complex legal issues facing the body but pressed the need for political will to overcome any bureaucratic obstacles the economic area might present.
Gonsalves said he welcomed the ALBA proposal’s “excellent provisions” for “special and differential treatment” – language which offers concessionary support for small, open economies such as those in the Eastern Caribbean.
“The world economy has entered a dangerous phase,” said Gonsalves quoting the International Monetary Fund in its world economic outlook.
But the OECS leader also noted that half of the six-member nations of the Eastern Caribbean Currency Union – Antigua and Barbuda, Grenada and St Kitts and Nevis – were currently involved in “structural adjustment” programmes of a “schizophrenic” IMF that at once proposed both “stimulus and austerity”.
“My observation (is that) the IMF programme is nothing more than a continued life-support system with no capacity to take the patient off life support,” Gonsalves told his counterparts.
But tracing the economic problems facing the Eastern Caribbean to the American financial crisis and the depression that followed in September 2008, Gonsalves drew the summit’s attention to the impact of the collapse of the British-American and CLICO insurance companies on OECS economies.
He said the insurance giants’ collapse left liabilities that amounted to 18 per cent of the combined GDP of the six-member Eastern Caribbean Currency Union, apart from the impact of the global economic crisis.
“In my country, St Vincent and the Grenadines, it is 22 per cent (of the national economy),” Gonsalves said.
He drew a distinction with US President Barack Obama, who raised one trillion US dollars to bail out the US banking system – about one per cent of the size of the American economy.
“If I had a one per cent problem (I do not have a problem). I have a 20 per cent problem,” Gonsalves declared.
The Vincentian prime minister also blasted the ongoing debate between Republicans and Democrats in an election year in the United States, saying it was an “infantile debate” that presented “no serious answers” and to the dangers facing the global economy.
He noted that the disparities in the American economy where corporations continued to amass wealth at the expense of ordinary citizens.
Gonsalves said these problems presented “no clear solution” to the small open economies of the Eastern Caribbean.
The three ALBA member states of Antigua and Barbuda, Dominica and St Vincent and the Grenadines are dwarfed by the five Latin American member nations with a combined population of 71 million people and Gross Domestic Product of 588 billion US dollars.
Chavez has been pushing the ALBA system as a center-piece of Venezuelan foreign policy and regional integration that relies heavily on a form of pan-American cooperation that posed an alternative to an international economic and political system dominated by the United States.
The Venezuelan leader’s rhetoric and his concept of ALBA are patterned after the democratic ideology of the 19th century military and political leader, Simon Bolivar, who led the political independence of Venezuela and five other South America nations.
Quoting from Bolivar’s writings, Chavez said that a political revolution could not succeed unless there was an economic revolution.
As if to mirror history, Haiti, which offered military aid and moral support to Bolivar during his struggle against the Spanish Empire 200 years ago, has been invited to join ALBA.
Haiti’s President Michel Martelly made his first appearance at the summit. He read a prepared text in Spanish that outlined his country’s struggle against poverty and the humanitarian disaster the 2010 earthquake had triggered.
Chavez urged Martelly to adopt the Sucre, while announcing a humanitarian aid fund and an ALBA-Haiti development plan for the poorest nation in the Americas.
Later on Sunday, Suriname’s President Desi Bouterse and St Lucia’s Prime Minister Dr. Kenny Anthony will address the second day of the summit, Chavez said.
Antigua Observer
