Caribbean Knowledge Series
8 items available
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The Caribbean Knowledge Series is an occasional series that presents World Bank knowledge in an accessible format. It is meant to assist knowledge sharing\r +
across the region and trigger policy dialogue on topics relevant for the Caribbean.
Items in this collection
1 - 8 of 8
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Publication
Resilient Growth, Persisting Inequality : Identifying Potential Factors Limiting Shared Prosperity in the Dominican Republic
(World Bank Group, Washington, DC, 2015-01)The Dominican Republic (DR) has recorded exceptional growth over the past twenty years and has closed the gap with the Latin America and Caribbean (LAC) region. While in the early 1990s the DRs per capita income was only about 57 percent that in LAC, it has climbed to around 90 percent nowadays. However, the countrys ability to reduce poverty and improving equity has been less stellar. This note presents some stylized facts of the DR economy that might help understand this phenomenon. In doing so, the note addresses the following three questions: (i) Has growth been inclusive in the DR?; (ii) Why has the DR economy grown so rapidly?; and (iii) Why has growth not led to further improvements in equity? This note tentatively argues that some potential factors explaining the latter are the decline in real wages despite increasing productivity, special economic zones that are relatively isolated from the rest of the economy, and the States limited capacity for fiscal redistribution. -
Publication
The New Trade Environment and Trade Performance in the Caribbean
(Washington, DC, 2014-06)Caribbean countries face a rapidly changing trade environment, which presents both opportunities and challenges for economies highly dependent on external markets. The features of the new trade environment include: i) redefinition of relations with their main trading partners, including the United States, where Caribbean exports continue to enjoy preferential access under the Caribbean Basin Initiative, and the European Union, through the recently signed Economic Partnership Agreement; ii) the increasing economic influence of the new growth poles1 (Brazil, Russia, India, Indonesia, China and Korea) ; iii) and the redesign of the CARICOM regional trade agreement in order to implement the Caribbean Single Market Economy (CSME) as well as a number of preferential trade agreements within the region. These changes are likely to change the trading structure of the Caribbean countries and, through this restructuring, to have implications for the welfare of these economies. Understanding these implications is critical in terms of designing appropriate policy response to the trade changes but also in terms of eventually re-shaping trade agreements and policies. -
Publication
Trade and Shared Prosperity in the Caribbean Region
(Washington, DC, 2014-06)This policy note is based on the seven chapters of the Caribbean trade report, The New Trade Environment and Shared Prosperity in the Caribbean, prepared by the World Bank for the Caribbean Growth Forum. Despite fairly respectable economic growth over the decades and a degree of high trade openness, unemployment rates remain very high in the Caribbean, averaging 10 percent for the region between 2002 and 2009, and poverty reduction has been slow. The purpose of this note is to provide background information on the role of trade in the unemployment and poverty reduction in the Caribbean and, based on recent World Bank analysis, to suggest areas where greater policy attention could promote trade and thus reduce poverty. The report begins with a profile of employment in the Caribbean, and discusses the impact of trade on employment during the global financial crisis. Evidence is reviewed on the role of trade in employment and development over the long term, and whether the poor in the Caribbean benefit from export activities. Then the report presents a discussion how addressing constraints on exports and reducing tariff levels will enhance growth and reduce poverty. The conclusion summarizes the main issues of addressing constraints on exports and promoting broad-based benefits of trade. The report's analysis shows that international trade plays a major role in terms of job creation and poverty reduction in the Caribbean, more so, on average, than in the other developing countries. However, in general, poor Caribbean households have not benefited fully from the employment opportunities created by trade. There is a role for policy in alleviating poverty by helping promote the shared benefits of trade. Considering the variety of issues involved in this area, it will likely require a multi-pronged approach involving the following measures: 1) promoting quality education for all; 2) strengthening links to the value chain among small enterprises; and 3) addressing key impediments to trade performances shows that acting to remove some key trade impediments may also directly help the poor. -
Publication
Youth Unemployment in the Caribbean
(World Bank, Washington, DC, 2014-04)Global economic shocks coupled with natural disasters left most Caribbean countries with zero to negative growth and high unemployment rates. The Caribbean region was strongly affected by the last great financial crisis, which resulted in a regional average of zero economic growth in 2010. The purpose of this note is to evaluate the nature of youth unemployment in order to propose policy options to address it. It is organized in three sections. The first section describes the trends and patterns of total unemployment. The second section focuses on youth unemployment. The third and final section discusses policy considerations. -
Publication
Public Private Partnerships in the Caribbean : Bridging the Financing Gap
(World Bank, Washington, DC, 2013-06)Caribbean countries are committed to achieving significant economic and social development to raise the living standards and welfare of citizens. To achieve rapid development, to support most needed sustainable high growth rates and poverty reduction, it is necessary to make substantial and immediate investments in economic and social infrastructure. Efficient, cost competitive facilities and services in transport and communications, energy, water, sanitation, health and education are essential to drive and support this development effort and to reduce poverty. Yet, fiscal space, the resources available to the public sector for needed infrastructure investments are very limited. Many Caribbean countries have high levels of public debt as a percentage of gross domestic product (GDP) and high fiscal deficits. Under traditional public procurement, government obtains a public infrastructure service such as electricity, water supply, schools and hospitals, by engaging a contractor to construct a facility which the Government then owns, manages and operates. This form of public procurement will continue, but as a result of the limited fiscal space, public infrastructure services development will also be sought through public private partnership (PPP) arrangements which will mean a broader role for the private sector in providing infrastructure facilities and services. The Governments of most Caribbean countries appear fully committed to promoting economic activities and enhancing the well-being of its citizens through more active participation of the private sector in improving the infrastructure of the nation. Those Governments believe that improving infrastructure through PPP arrangements will harness the development of the private sector to contribute to the growth of GDP and poverty reduction over the life of their respective strategic development plan and current administrations. -
Publication
Trade Facilitation in the Caribbean : The Case of Customs Performance
(World Bank, Washington, DC, 2013-06)The trade of goods and services and the inflows from Foreign Direct Investments (FDI) represent large proportions of their Gross Domestic Products (GDP), especially in English Speaking Caribbean (ESC) countries. Therefore, the proper functioning of the channels that connect them to the rest of the world, including customs offices, is essential to the performance of their economies. This note shows that, despite integration into the world economy, customs performance in the Caribbean countries is comparatively low. This note presents data from the Customs Assessment Trade Toolkit (CATT), which provides empirical evidence that processes do not meet adequate standards in terms of speed, predictability and transparency. This inconsistency is partially explained by the lack of an effective complementarity between the use of Information and Communication Technologies (ICT) systems and the actual operational practices. This policy note is organized as follows: section three presents evidence on the economic profile of the Caribbean countries to show high integration to the world economy. Trade and FDI are they key aspects being considered in this regard. Section four discusses the role of customs systems for economic development. It analyzes the performance of the Caribbean customs offices in a number of aspects (clearance times, predictability, and transparency) that the literature has identified as critical to promote competitiveness and development. Section five expands this analysis by focusing on how the use of ICT can improve customs performance in those aspects. Section six summarizes the lessons learned by the analysis of these data. Finally, the conclusions section presents some policy recommendations to deal with the inconsistency between high economic openness and low customs performance in the Caribbean countries. -
Publication
Promoting Growth in the Caribbean : Tax Incentives in Theory and in Practice
(World Bank, Washington, DC, 2013-06)The recent international financial crisis dealt a hard blow to the region's growth prospects, being reflected in reduced demand for financial services and tourism as well as falling remittances. This was combined in some cases with home grown macroeconomic imbalances and the need to face the costs of financial sector bailouts in other countries. More recently, policymakers have indicated the need to explore the use of tax incentives in order to foster much needed private investment. This policy note analyzes the issues associated with the use of tax incentives and reviews the challenges faced by the region, which has had a not altogether successful experience in controlling tax expenditures. The policy note is organized as follows: the first section explores the diverse nature of the Caribbean and Latin American group of countries referred to in this note: the Bahamas, Barbados, Belize, Dominican Republic, Guyana, Haiti, Jamaica, Suriname and Trinidad and Tobago. This is followed by a word of caution regarding the emphasis on factor accumulation in explaining growth, dampening beforehand any unrealistic expectations regarding growth promoting tax incentives. A brief analytical review of the main direct and indirect tax instruments is included in section three. Section four discusses features of good tax incentive systems. Section five reviews some country experience with provision of tax relief. Last section gives a brief set of recommendations. -
Publication
Quality Education Counts for Skills and Growth
(World Bank, Washington, DC, 2013-06)The quality and relevance of education are paramount to achieve economic growth. International research shows that the subject matter learned and skillset developed in the classroom is the foundation for future success in the work place, and serves as a superior predictor of economic growth compared with the number of years of school. One recent study, using a database of comparable test scores for over 50 countries, finds that a single standard deviation difference in tests scores between countries equates to roughly 2 percentage points in annual long-term Gross Domestic Product (GDP) growth. These findings hold true across high-income, middle-income, and low-income countries and all geographical regions. Despite significant investments in formal education, economic growth in the region has slowed in recent years and there is a need for improved labor productivity.