Caribbean States Plan Action On Int'l Banks' 'De-Risking'
by Mike Godfrey, Lowtax.net, Washington
24 February, 2016
The impact of international banks de-risking efforts on the Caribbean banking industry was the focus of the recent 26th Meeting of the Heads of Government of the Caribbean Community (CARICOM).
In a post-meeting communique, the Heads of Government highlighted the progressive decline in US and European banks' correspondent banking relationships with banks in CARICOM member states. Belize's Prime Minister, Dean Barrow, said de-risking, whereby international banks are ceasing to do business with certain overseas banks, poses "absolutely cataclysmic ramifications" for the Community.
Heads of government said the withdrawal, restricted access, and /or the higher cost of such services, allegedly in response to the heightened regulatory posture of regulatory authorities, would destabilize the financial sector in member states with deleterious effects on growth and economic progress, as well as national security.
They emphasized that CARICOM member states have complied with all global regulatory standards, including those established by the Financial Action Task Force and the OECD Global Forum, and have been scrutinized in every detail by the International Monetary Fund and other multilateral institutions. They characterized the actions of the correspondent banks as an economic assault, tantamount to an economic blockade against member states.
Heads of government therefore agreed to the appointment of a high-level advocacy group, led by the Prime Minister of Antigua and Barbuda. This group will be charged with representing the interest of the region in addressing the issue, including by approaching the United Nations, the World Trade Organization, and the US Congress to raise international awareness of the challenges CARICOM states face.
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