"In 1999, economic developments in the Caribbean were generally positive as well, although major risks in the small, export-based economies persist; and we again witnessed the vulnerability of these countries to hurricanes-most recently in the Bahamas and in the Leeward Islands. While there were some exceptions, most economies registered positive real growth, low to moderate levels of inflation and reduced fiscal imbalances. Unemployment was reduced on average but major pockets of joblessness persist, leaving many facing poverty.

Caribbean governments have generally been doing their part to contribute to strengthening the international financial architecture, in particular by improving transparency in fiscal and financial operations. Most of the Caribbean members of the constituency participated in the Fund's pilot project on transparency and published their Article IV Reports, and practically all have put in place mechanisms to adhere to best practices in fiscal and monetary policy. Room for improvement remains, however, in building more robust tax systems and statistical capacities, and in programming and managing public expenditure. And the region is in need of the Fund's continued support for technical assistance in these areas.

Some members of our constituency, whose economies still rely on export earnings from commodities including bananas, are attempting to adjust to the harsh realities of a new global trade regime. Part of the adjustment strategy includes diversification into services, including tourism and offshore financial services, as supplements to agriculture. With respect to offshore financial services, these governments are committed to ensuring that this sector continues to develop within the framework of a rigorous regulatory system.

The adjustment difficulties facing Caribbean countries and other small states have recently been highlighted by the work of a joint World Bank and Commonwealth Secretariat task force on small states, and we support their recommendations. There is a clear need for the Bank, the Fund and other donors to take a close look at the way their actions and approaches affect small states if they are to have a chance of achieving their objectives of sustained poverty reduction and development. Continued support for small states is essential."

The Minister's full speech 
and other IMF publications can be found at www.imf.org

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