Front Matter

Front Matter

Author(s):
Ruby Randall, Jorge Shepherd, Frits Van Beek, J. Rosales, and Mayra Zermeno
Published Date:
August 2000
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    OCCASIONAL PAPER

    The Eastern Caribbean Currency Union Institutions, Performance, and Policy Issues

    Frits van Beek, Jose Roberto Rosales, Mayra Zermeno, Ruby Randall, and Jorge Shepherd

    INTERNATIONAL MONETARY FUND

    Washington DC

    July 2000

    © 2000 International Monetary Fund

    Production: IMF Graphics Section

    Typesetting: Alicia Etchebarne-Bourdin

    Figures: In-Ok Yoon

    Library of Congress Cataloging-in-Publication Data

    The Eastern Caribbean Currency Union—institutions, performance, and policy issues / Frits van Beek … [et al.].

    p. cm.—(IMF occasional paper ; no. 195)

    “July 2000.”

    ISBN 1-55775-894-8

    1. Eastern Caribbean Currency Union—History. 2. Monetary unions—Caribbean Area—History. 3. Eastern Caribbean Central Bank—History. I. Title: Eastern Caribbean Currency Union. II. Van Beek, Frits. III. Occasional paper (International Monetary Fund); no. 195.

    HG742.E27 2000

    362.4’9729—dc21 00-039563

    CIP

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    Contents

    The following symbols have been used throughout this paper:

    • … to indicate that data are not available;

    • — to indicate that the figure is zero or less than half the final digit shown, or that the item does not exist;

    • – between years or months (e.g., 1998–99 or January–June) to indicate the years or months covered, including the beginning and ending years or months;

    • / between years (e.g., 1998/99) to indicate a fiscal (financial) year.

    • “Billion” means a thousand million.

    • Minor discrepancies between constituent figures and totals are due to rounding.

    • The term “country,” as used in this paper, does not in all cases refer to a territorial entity that is a state as understood by international law and practice; the term also covers some territorial entities that are not States, but for which statistical data are maintained and provided internationally on a separate and independent basis.

    Preface

    IMF staff teams visited Basseterre, St. Kitts and Nevis, during November 23–27, 1998 and February 22–25, 1999 to hold policy discussions with senior officials of the Eastern Caribbean Central Bank (ECCB). The ECCB representatives were headed by Governor K. Dwight Venner. The discussions focused on a review of recent performance and on key regional policy issues in the monetary and banking, fiscal, external, and other areas.

    These visits provided a framework to complement the bilateral surveillance discussions held in 1998–99 with the ECCB member countries that are also members of the IMF. Given the widening range of economic policies formulated and implemented at the regional level, and in view of the special characteristics of the ECCB area, both the IMF and regional authorities believe that regional discussions should be held more frequently. Accordingly, as part of a move to a more formal and comprehensive dialogue with the Eastern Caribbean regional institutions, reports on such discussions will be presented to the IMF’s Executive Board on a regular basis.

    The material presented in this paper was originally prepared for discussion in the IMF Executive Board in March 1999; it is based on data through December 1998, but takes account also of key developments in 1999. The paper includes a large amount of statistical information that is not readily available elsewhere in a single source (see Box 1). The authors are grateful to the management and staff of the Eastern Caribbean Central Bank for extensive discussions and comments and for their assistance in providing data and other source material, and to colleagues in the IMF for helpful comments on previous drafts.

    The authors wish to express their appreciation to Jeremy Clift of the External Relations Department for editing the paper and coordinating its publication. They are also grateful for the assistance provided by Patricia Parsons and Alfred Go of the Western Hemisphere Department in processing the original text, tables, and other materials. The views expressed are the sole responsibility of the authors and do not necessarily reflect those of the IMF staff or Executive Board, or the Eastern Caribbean Central Bank.

    Box 1.Statistical Note

    The banking, balance of payments, debt, and national accounts data presented in this paper were provided by the Eastern Caribbean Central Bank (ECCB). Discrepancies with figures presented in recent IMF reports on the six independent member states of the ECCB are due largely to differences in timeliness (ECCB data are updated as of December 1999) and, to a lesser extent, to differences in compilation methodologies and sources. Despite steady convergence in recent years, differences remain between ECCB and the IMF country desk data on the balance payments and external debt of certain countries. The data presented on public sector revenue, expenditure, and financing are from the IMF data files maintained for the six independent member states of the ECCB, and any differences with data shown in recent IMF Staff Country Reports are due to updating of preliminary data and earlier projections for 1997 and 1998.

    As regards regional coverage, the national accounts and other data presented in Table 1, 913, and 1923 generally exclude Anguilla and Montserrat, except for regional GDP and tourism, as indicated in the footnotes. The fiscal data shown in Table 2433 exclude Anguilla and Montserrat, while the monetary data (Table 27 and 3437) and the balance of payments data (Table 4243) include those two territories.

    These differences in sources and country coverage preclude a high degree of intersectoral consistency. While the monetary and balance of payments data are fully consistent, this is not the case for the fiscal and balance of payments data. It may be noted that the combined balance of payments for the region does not net out intraregional transactions for lack of the requisite detail, except for intraregional capital flows identified in the accounts of the commercial banks. Furthermore, the overall balance of payments of the region does not equal the sum of the imputed overall payments balances of the eight individual countries.

    List of Abbreviations

    ACP

    African, Caribbean, and Pacific countries

    BCCB

    British Caribbean Currency Board

    CARICOM

    Caribbean Community and Common Market

    CDB

    Caribbean Development Bank

    CET

    Common External Tariff (of CARICOM)

    CMCF

    Caribbean Multilateral Clearing Facility

    ECCA

    Eastern Caribbean Currency Authority

    ECCB

    Eastern Caribbean Central Bank

    ECCM

    Eastern Caribbean Common Market

    ECCSD

    Eastern Caribbean Central Securities Depository

    ECCSR

    Eastern Caribbean Central Securities Registry

    ECCU

    Eastern Caribbean Currency Union

    ECEF

    Eastern Caribbean Enterprise Fund

    ECGS

    Export Credit Guarantee Scheme

    ECHMB

    Eastern Caribbean Home Mortgage Bank

    ECSE

    Eastern Caribbean Securities Exchange

    ECSRC

    Eastern Caribbean Securities Regulatory Commission

    ECUTC

    Eastern Caribbean Unit Trust Company

    EU

    European Union

    GATT

    General Agreement on Tariffs and Trade

    NAFTA

    North American Free Trade Agreement

    OECS

    Organization of Eastern Caribbean States

    RGSM

    Regional Government Securities Market

    UBA

    Uniform Banking Act

    WBDECO

    The Windward Islands Banana Development and Export Company

    WTO

    The World Trade Organization

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