EDITORIAL - Changing of the guard at CDB

Dr Warren Smith's election by the board of governors to be the next president of the Caribbean Development Bank (CDB) marks a deserved elevation of a son of Jamaica, tinged with a bit of sadness and a small dose of irony.

When people discuss Caribbean integration and the institutions that help to give meaning to the concept, it is surprising just how often the CDB is overlooked. The bank is not usually in our frame of reference.

But last week, the Jamaican Parliament approved a guarantee for a US$20-million loan by the CDB for the Students' Loan Bureau. Earlier, it contributed about US$50 million to the nearly J$2 billion in loans that multilaterals, including the International Monetary Fund, agreed to provide to help pull Jamaica out of its economic crisis.

Yet, we might have missed the CDB.

In 1969, regional finance ministers gathered in Kingston to sign the final protocols for the launch of the CDB the next year and to decide where the bank was to be situated. Edward Seaga proposed Jamaica, but the consensus was for Barbados.

Good sense

For a period, Mr Seaga bristled and hinted that Jamaica could stay out of the bank. Good sense, however, finally prevailed - to Jamaica's and the region's benefit.

Indeed, it is doubtful that in the absence of Jamaica, given what had transpired with the West Indies Federation nearly a decade earlier, that there would have been the will to seriously push ahead with the CDB. At least, not in the form that it has emerged over the past 40 years.

This is the sadness. Professor Compton Bourne, 67, a Guyanese by birth, had made it known he was interested in a third five-year term as head of the CDB. He maintained his candidacy, even after it was clear that Jamaica had proposed Dr Smith and was harking to the informal 'understandings' at the retirement of his predecessor, Sir Neville Nicholls, that CDB presidents should not serve more than two terms.

Even if we feel that that was not Professor Bourne's most skilful or elegant moment at the CDB, there is no question that he gave new energy, direction and seriousness to the bank. He, for instance, repaired strained relations between the CDB and other multilaterals, particularly the World Bank, and widened the network of organisations with which it works.

Improved efficiency

He has also improved efficiency at the bank, including lowering the administrative cost of its loans and the turnaround time of its applications. Earlier this year, he guided the work leading to the approval by the governors of a 150 per cent increase (US$1billion) in the bank's capital.

The bottom line is that Compton Bourne can be proud of his tenure as president of the CDB and deserves the congratulations of the region.

We believe that Dr Smith will build effectively on the foundation that is already in place and add his own vision to the organisation. He understands the region well and has the advantage of working in institutional and commercial settings, including as CEO of LIAT and a vice-president of Life of Jamaica.

He also thinks outside the box. Long before any such plan was implemented, he was among a group of economists who argued, in private, for Jamaica's need for a debt exchange. He remains well connected at Jamaica's finance ministry.

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