Representatives of the CARICOM Development Fund (CDF) were in Belize from Monday, July 6, to Thursday, July 9, to “speak to stakeholders about the current status of the CDF”.
Ambassador Lorne McDonnough, Chief Executive Officer of the CDF, held a press conference for the media in Belize on Tuesday, July 7, to inform the public about the role of the CDF and why it is needed. McDonnough made a significant announcement at the press conference. He said, “We expect that the CDF will be ready to disburse funds by the end of July.”
The fact that the CDF is already operational is a major accomplishment since it is just a little over a year since the body was officially launched. Lenox Forte, Manager of Corporate Development and Programming, said that it was no easy task getting the CDF operational so quickly. He said, “It is very difficult to get all the Finance Ministers to meet and we got them to meet twice in one year and got our budget approved in February of this year.”
Over a four year span, from 2008- 2012, the public and private sector of Belize can access in grants the amount of money that the country has contributed to the CDF. That amount is US$3.05 million.
The CARICOM Development Fund was developed to tackle difficulties that members of CARICOM may experience in the transition process to the CARICOM Single Market and Economy (CSME). Provision for the CDF is found in Chapter Seven of the Revised Treaty of Chaguaramas, which established the Caribbean Community including the CARICOM Single Market and Economy. However, it was not until the 29th Conference of Heads of Government of the Caribbean Community in 2008 that the CDF was officially launched.
A common question in regards to the CDF has been, “If we have the Caribbean Development Bank (CDB) why do we need the CDF?” McDonnough said, “The CDF will have a laser like focus on mitigating the difficulties countries encounter in the transition to more in depth integration.” He said that the CDF will work with both the public and private sector in an effort to promote the process.
The CDF also differs in several ways from the CDB. Unlike the CDF, not all member states of CARICOM are members of the CDB. Suriname is not a member of the Caribbean Development Bank. Another difference is that the CDB has members that are external to the region; example, Mexico, United Kingdom and many other large countries, while the CDF is made up of only members from CARICOM. There are more differences but the overall theme is that the CDF is focused directly on the development of CARICOM member states.
Another commonly asked question is, “How is the CDF funded?” The CDF’s original goal was to raise US$250 million for the fund. Member States would contribute $120M of the Fund through a formula that would take into account size, per capita income and other minor indices. The Community would tap its international development partners for contributions to the remainder of the Fund.
The disbursements will occur in the forms of loans, grants and interest subsidies. The way the process works is that the country applies for the loan or grant and a nine member board makes the decision on whether or not the project is deserving of financial assistance from the CDF. Dr. Carla Barnett from Belize is the Vice-Chair of the Board. McDonnough said, “The CDF is likely to approve loans for projects that will promote development.” He also said that another area where the CDF will definitely provide assistance is in times of disaster. He said, “We will provide funding for recovery from the negative social and economic effects of natural disasters.”
Lorne McDonnough met with the Prime Minister of Belize, Hon. Dean Barrow, on Wednesday, July 08, to brief him on the status of the CDF. At that time, he listened to the issues that Prime Minister Barrow considers to be disadvantageous to Belize in the movement towards the CSME.
