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PRESS STATEMENT
The issue discussed at the breakfast meeting with the Managing Director of the International Monetary Fund and the President of the World Bank was whether devaluation was beneficial for small economies. Madame Lagarde was of the opinion that a devaluation of the Barbados dollar would make our tourism more competitive and help our economy to grow. To most of us in the Caribbean, it does not seem rational to impoverish yourself to grow your economy. To us, it is obvious that is what devaluation implies. The point is not so obvious to Americans and Europeans. In a recent publication that was distributed during the Annual Meetings in Tokyo, I try to explain why things appear so differently from the point of view of small open economies (See my article at www.group30.org).
The Caribbean values very highly the opportunity that the International Monetary Fund and World Bank provide us, to air our concerns in frank and open discussion. In correspondence after the breakfast meeting, I reassured Madame Lagarde that, like my colleagues in the region, I am highly appreciative of the initiatives that the International Monetary Fund and the World Bank have undertaken to focus on the concerns of the Caribbean and other small nations. Madame Lagarde sent a gracious response confirming her commitment to the ongoing relationship.
The dialogue between Barbados and the International Monetary Fund is continuous, and there are several opportunities each year for face-to-face contact with International Monetary Fund staff, including at the Annual Meetings. Our aim at all times is to arrive at a full understanding of Barbados' circumstances, and of the options open to us. We engaged in discussions with the International Monetary Fund towards this end in Tokyo, and that dialogue continues.
The breakfast meeting of the Managing Director of the International Monetary Fund and the President of the World Bank is a private meeting with Ministers of Finance and Governors of Central Banks of the Caribbean, at which no press are present and no record is taken for public circulation. It is unhelpful if such private exchanges, offered in the search for better understanding among the parties, are made public, creating an impression of conflict where none exists.
Governor of the Central Bank of Barbados, Dr.DeLisle Worrell
October 29, 2012
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