GROS ISLET, St Lucia — There is no justice in the de-banking and barring of small Caribbean states from the international payment system, said Antigua and Barbuda’s Prime Minister Gaston Browne, who has lead responsibility for financial matters in the quasi-Cabinet of Caribbean Community (CARICOM) heads of government.
The prime minister was speaking at a forum in Saint Lucia on Thursday organized by the Economic Commission for Latin America and the Caribbean (ECLAC).
“De-banking and de-risking undermines the ability of small countries to meet their development agenda and injures them without any mechanism for remedy”, Browne told the audience of fellow Caribbean prime ministers, central bank and financial officials and private sector representatives.
The prime minister’s remarks were part of a wide-ranging discourse on the severe challenges that Caribbean countries face in the financial services sector as a consequence of actions of the OECD, FATF, the European Union Commission and the United States government.
He observed that de-risking, which involves the loss of banking relations between Caribbean banks and international banks, “remains a looming threat that could create financial instability, plunging our countries into poverty, chaos and confusion”. And, he added, “The consequences of de-risking – intended or unintended – could be more devastating than any natural disaster.”
Recalling that “de-risking is utilized as a policy tool of financial warfare, to sanction rogue or uncooperative states,” the prime minister argued that it “should never be utilized as a tool to punish innocent people in cooperative and compliant countries in the Caribbean”.
“The provision of correspondent banking service is a fundamental human right. It is just as important as the provision of other basic services, including include water, electricity and broadband services,” according to the Antigua and Barbuda prime minister, who is a former banker and a financial manager by training.
Browne set out measures to address the problem of de-risking which, he said, could shut down established and regulated financial systems, and so encourage unregulated methods that would fuel money laundering and other financial crimes.
Among the proposals that the prime minister made are encouraging all banks to focus on managing financial crime risks instead of risk avoidance, and the utilization of new technology, including blockchain, to identify suspicious transactions and to ensure full traceability.
The Antigua and Barbuda prime minister has been the lead advocate of the rights of Caribbean countries in this matter since July 2014, taking his mission to international financial institutions, multilateral bodies and private sector fora.