Robertson S. Henry. Sports and Cultural Contributor
TUESDAY JULY 29, 2014; KINGSTOWN, ST. VINCENT AND THE GRENADINES -Caribbean news. The Eastern Caribbean Central Bank (ECCB) Monetary Council met in St. Vincent and the Grenadines on Friday July 25 at the Buccament Bay Resort.
At the 79th meeting of the Council, it welcomed its newest member, Honourable Gaston Browne, Prime Minister and Finance Minister of Antigua and Barbuda.
According to a Communiqué released, the ECCB, the Council received the Governor’s Report on the Monetary and Credit conditions, which indicated that monetary conditions improved during the year ending March 31, 2014, but credit conditions tightened further as was evidenced by the widening of the interest rate spread during the review period.
The Council was told that liquidity in the commercial banking sector remained buoyant as total deposits were estimated to have increased by 5.2% compared with 4.2% in the corresponding period 2013.
Economic activity in the tourism sector was estimated to have improved with a projected increase in tourism receipts of 2.3%, stay over visitors to the region were estimated to have increased by 1% from that recorded in 2013.
The near term outlook and prospects revealed that a strengthening of the economic recovery in the major trading partners of the Eastern Caribbean Currency Union (ECCU) was expected to lead to an improvement in foreign exchange inflows thus resulting in an easing in the monetary and credit conditions in the short term.
As regards the monetary policy assessment the council agreed to maintain minimum savings deposit rate of 3.0 per cent and the central bank’s discount rate at 6.5 per cent.
On the matter of financial sector stability; as of March 31 of this year, the ECCU financial system continued to exhibit symptoms of stress from the effects of the global economic and financial crisis, the system was however stable as evidenced by the strength of the Eastern Caribbean (EC) dollar, the efficiency of the payments and settlements system, increasing deposits, improvement in liquidity and a relatively high level of public confidence elements of stability.
Real Gross Domestic Product (GDP) in the ECCU is expected to increase from 1.1% in 2013 to 1.7% in 2014 and 2.1% in 2015. Increasing GDP growth rates is a policy priority for the ECCU member governments as increased growth is likely to strengthen the financial sector and improve fiscal and debt sustainability.
The council noted that phase three of the ECCU BAICO/CLICO Policyholders relief programme would be continued as soon as the next disbursement from Trinidad and Tobago is received. It also took note of the current status of Clico International Life (CIL), including the approval of the Barbados Cabinet and implementation of the CIL resolution plan for Barbados policyholders and approved in the principle a counterproposal that includes the ECCU Policyholders.
It was agreed that the 80th meeting of the Monetary Council will be held on October 31, 2014 via video conference, amongst the various council members and ECCU officials.
