By Kenton X. Chance
GEORGETOWN, Guyana (CMC) – President Irfaan Ali Monday urged the Caribbean private sector to help find a solution to the problems facing transportation in the region.
“I will consider it a severe missed opportunity by the regional private sector if they cannot form a consortium and use this opportunity that Africa Ex-Im Bank is offering to end our regional transport system failure,” Ali told the opening of the two-day second AfriCaribbean Trade and Investment Forum (ACTIF23).
“And I speak specifically about our maritime transport infrastructure,” he said at the forum, being held under the theme “Creating a Shared Prosperous Future”.
“We can plant and grow as much as we want. We can do our processing, manufacturing, industrial development, we can re-engineer the supply chain, but we have to move things, we have to move things throughout the region. We must find the solution,” Ali said.
The Egypt-based African Export-Import Bank (Afreximbank) and the Guyana government are hosting the forum, the first of which was held in Barbados last year.
In August, Afreximbank, which has a US$35 billion asset base, opened its Caribbean office in Barbados, the first outside of the continentwith 11 Caribbean Community (CARICOM) countries becoming members of the bank. Afreximbank has also opened a US$1.5 billion line of credit to the region.
Ali said the bank has assured the region that it is ready to examine a proposal from the regional private sector to present a solution to the transpiration issues.
“Every single state of CARICOM has made it clear that we will give all the incentives necessary to facilitate the building of a regional transport infrastructure system to solve the problem of regional transport. It is in your hands now,” Ali said as he challenged the regional private sector to step up to the plate.
“And we will champion it. We will champion it with Afreximbank. Form a consortium between the providers who are under the Afreximbank portfolio and the regional consortium. We are too small to think and act in silos.
“We have to learn to remove the imaginary barriers between ourselves and act in a collective, in consortium bringing together our collective capital, our collective planning, our collective structure so that we can make use of larger scale opportunities that exist within the region.”
Ali said the region could not “tiptoe around this anymore.
“The private sector has failed us in this endeavour. This is a business opportunity, not a state opportunity. This is a business opportunity that governments in the region are ready to facilitate and support to the right incentive and fiscal system. We have made it very clear. you need now to be what you always have demonstrated yourself to be: the engine of growth. The governments are the facilitators of growth.
“So before the end of this forum. I hope that the regional private sector with your colleagues in the African Union and under the African ExIm umbrella would present to the Secretary General a path towards a consortium approach in resolving the regional transport problem.”
Ali said that if there are interests to be protected, the private sector should let CARICOM leaders know what they are.
“Because the day is for talking and tiptoeing and massaging this issue and tapping the head is over. We have to brutally confront it and deal with it. Otherwise, successive generations of us will be viewed the same way: come in, talk, and leave the problem and gone again,” said the 43-year-old Ali, who was elected to office in 2020.
He said that while Afeximbank has a US$35 billion asset base, the financial services sector accounted for more than 50 per cent of its loan portfolio, adding that other sectors accounted for 32.8 per cent.
Ali said that when many people think of Afreximbank, “right away in their head, all this money in some oil field or some investment in oil facilities.
“But oil and gas accounted for only 15.1 per cent. What that tells you?” Ali said, noting that manufacturing accounted for 4.5 per cent, power generation accounted for 4.2 per cent and construction around 3.5 per cent.
“It tells you that the bank has an interest in its diversified portfolio of opportunities,” he said, adding that Guyana wants to present itself as a leader in food, energy and climate security in a world 2030 and beyond.
“We have all the natural attributes in doing this. If you look at the investment opportunities that exists within the region itself, in the context of the US$1.5 billion already committed by the Afreximbank to support SMEs in the region, and I think before the end of this forum once we come to a good understanding on the term sheet … that may go up.”
Ali noted that CARICOM has about 19 million people, most of whom use the services of the region through the tourism product.
“We also have hundreds of millions of people with whom we have preferential trade arrangements with as a body — CARICOM. And all of this presents a unique opportunity for investment here in the region,” Ali said.
“If you look at markets that are in close proximity to us, the North American market, close to 440 million persons, the South American market, more than 380 million plus persons, that is more than 800 million possible consumers.
“The distinct advantages that we have, for example, in aquaculture in the seafood industry, with technology and innovation and industrialisation, we can be a unique platform through which we target this very high value market among the consumers I described.”
Ali said South-South trade potential is estimated as US$16 trillion with a population of 4 billion among 42 developing countries.
He pointed out that the United Nations Conference on Trade and Development (UNCTAD) has reported that the volume is now higher than that of the north-south trade, growing faster than the world average, fostering trade in non-traditional exports including higher value added and technology-intensive manufactured goods.
“Now this is an important fact that we must not forget,” Ali said, adding that during slavery, much wealth was extracted from the region.
“After slavery, the developed world had the ability to move rapidly into what was then term ‘mechanisation’,” he said, adding that the developing world did not have the capital to move as rapidly towards mechanisation.
“Now, the developing world is in a position to invest in mechanisation and modernisation. But guess what? The developed world has now leapfrogged into digitisation and innovation, creating another set of comparative competitive disadvantages.
“We now have to leapfrog ourselves into this digital innovative boardroom talking about telemedicine, digitisation of government services and that is the position through which we find ourselves,” he said, adding that CARICOM leaders are now grappling with this challenge of ensuring that the region is not again left 40 or 50 years behind because of innovation and digitisation.
“And that is where I think the Afreximbank and CARICOM must align our time, how we can build a regional project, how we can transfer the technology within the confines of our own control, to accelerate innovation, digitisation and the technology that is required in a world 2030 and beyond,” Ali said.