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CARICOM Concerned Over the Region’s Loss of Correspondent Banking with the EU and US

Also coming from Doctor Barnett’s end-of-year press conference was the discussion on the region’s loss of correspondent banking relationships with institutions in the United States and the European Union. The problem is that since 2016, financial institutions across the developed world saw smaller jurisdictions like Belize, not as important to do business with or as a haven for illicit activity. In her overview of the situation, Doctor Barnett told the media today that CARICOM’s lobbying efforts continue.

Dr.Carla Barnett, CARICOM Secretariat: “There are two issues there. One is that even if we were to have a unified single policy regulatory process however you want to formulate it from the CARICOM side internationally there is not a unified regulatory process. Each country individually deals with the EU, countries in the EU with the US with every single set of countries that feel that they have a right ot blacklist groups of countries. And so the weight that we bear is not only in relation to what each group may do such as the OECD or FATIF or whomever it may be. The reality is that we have to treat with at the national levels of all of these individual requirements that are being placed at each of our countries and so when you see a black list that’s “blacklist” that’s published sometimes those lists contradict with listings that have been issued by other groups. And so one of the calls that we have made over the years as a region individually whether it’s in meetings, whether it’s in Commonwealth meetings or UN meetings or wherever we meet was a group is for the international community to itself develop some kind of harmonious approach to how it wants the international financial system to be regulated because that does not exist.”

One of the harsh realities that the Caribbean region faces is that while governments adjust their laws to avoid blacklisting, Doctor Barnett lamented that there is not a single set of financial standards that apply globally and often times, CARICOM states must deal with constant shifts in the proverbial goalposts.

Dr.Carla Barnett, CARICOM Secretariat: “The impact on our individual territories is that much greater because we then have to be treating with meeting the requirements of four or five different sets of countries. So many of us have changed our laws to meet the requirements of the EU. We’ve changed our laws to meet the requirements of the US. We’ve changed our laws to meet the requirements of everybody but those requirements change as well. So it’s not only the lack of unity on their side it is also the fact that these requirements are constantly changing and for many of us we’ve reached a point where we come off a blacklist we do nothing else, we stay ,we change our laws then another year we’re back on the blacklist not because we have done anything wrong but because the requirements outside have changed. And so there is a position that we’re in where we really do not have the capacity literally in terms of influence, in terms of range of institutions to change the international process of determining what the overall approach to financial sector supervision ought to be in place globally because that is constantly changing and the impact on our society our economies have been huge because many of our local institutions for example our local financial institutions find it extremely difficult to maintain correspondent banking relations that would allow us to pay for ordinary transactions and so the impact on us is huge. I can’t tell you that that will change I can only tell you that we will, we have never stopped working together as a group on it. We continue to work with the Europeans, the Americans, the OECD whichever group but we advocate we don’t make the rules.”