Caribbean economist leaves detailed review on PM Gonsalves’ new book

Kari Grenade

by Kari Grenade, PhD, Caribbean Economist and Macroeconomic Advisor

Over the Christmas holidays, I took some time to read “A Time of Respair – Beyond Covid, Volcanic Eruptions, Hurricane Elsa and Global Turmoil: Fresh Hope for St Vincent and the Grenadines” by Dr The Hon. Ralph E Gonsalves. 

As I do with all books that I read, I started with the last chapter first. This one ends with the author citing the profound words of a Vincentian poet: “We are all time, yet only the future is ours to desecrate. The present is the past, and the past, our fathers’ mischief” in ‘We are the Cenotaphs’, by David Williams. I was captivated!

The book is one of history, culture, literature, politics, governance, and economics all coalesced into a splendid read! For the purposes of this article, my review is confined to the aspects of the book that deal with economics and sustainable development issues.

In the 6 chapters of the book, one gets rich details of St Vincent and the Grenadines’ (SVG’s) economic development evolution since its days as a colony to contemporary times. SVG’s trials are well described. Indeed, SVG has had to dust itself off, figuratively and literally, from the combined effects of multiple overlapping shocks over time, the most recent ones being Covid-19, volcanic eruptions, Hurricane Elsa, and unprecedented global economic upheavals. Ordinarily, those shocks and their devastating socioeconomic impacts would warrant despair, but the author, who from his writings, appears not to have a lamenting spirit, lucidly explains why respair, and not despair, was the option for SVG. The word respair, according to the author goes beyond the notion of rebuilding and recovery, to a more profound notion that “goes to our existential beings” (p. 10). It connotes the idea of fresh hope and trump after debilitating setbacks.

The author does a great job in my view in anchoring complex matters relating to economic sovereignty, economic growth, and sustainable development on the simple, yet profound concept of respair. In the quest to respair against historical injustices as well as economic, geo-political, and natural forces, the author fascinatingly explains how SVG has tapped into its collective strength to chart a new development paradigm of “building a modern, competitive, many-sided, post-colonial economy that is at once national, regional and global” (p. 61). Each word, according to the author “is pregnant with real meaning and collectively, they point to sound theoretical underpinnings, appropriate policies, and practical programmes” (p.61). The author rightly points out that the imperative to build such an economy is not for its own sake, but fundamentally, to improve the lives of Vincentians and unleash their individual and collective potential and greatness.

The author discusses core philosophical elements of a modern, competitive, many-sided, post-colonial economy including a people-centered development vision; an embrace of the universal principles of advanced social democracy; optimal good governance, within a constitutional order of competitive parliamentary democracy; and pragmatic and feasible cohesion between the public, private and cooperative sectors. The author devotes an entire chapter to the mixed economy and its practical application in SVG. I was particularly pleased to see this given that mainstream contemporary Caribbean economists still pay too little attention to the crucially-important tripartite partnership in the day-to-day functioning of Caribbean economies.

Time of Respair

The author describes an impressive list of projects, programmes, and initiatives that have been executed in SVG in the past 21 years in building its modern, competitive, many-sided, post-colonial economy. As I read of all the important projects, programmes, and initiatives implemented, I could not help but wonder why the level of average per capita income of SVG has been persistently below that of the average of the Eastern Caribbean Currency Union (ECCU) and the average of the wider Caricom in the past 2 decades. I am well aware of the flaws in the GDP per capita numeric as a measure of standard of living and prosperity, but it is the most common measure used for country comparisons of economic development.

While the author does rightly point out the deficiencies in GDP per capita, I think he could have delved deeper and engaged with literature on the binding constraints on economic development to help readers better understand possible reasons for SVG’s low levels of national income per capita relative to other ECCU and Caribbean countries of similar size, endowments, historical context and economic structures. Such an examination would have enriched the discussion on pages 71-82 on sustainable development and economic growth.

In the discussion on sustainable development and economic growth, the author cautions against development dead-ends and identifies fifteen, as he calls them, “terribly bad ideas” (p. 77) to avoid in formulating and implementing public policies. On the list of terribly bad ideas, which the author admits is not exhaustive, these 2 caught my attention: (i) fiscal austerity; and (ii) selling citizenship and passports. On fiscal austerity, the author is adamant that “cutting spending in infrastructure and other public spending that yield long-term gain because of short-term macroeconomic compulsions is a wrong and dangerous idea” (p 77). Regarding the sale of citizenship and passport, the author argues, “selling passports/citizenship boomerangs against the economy, the fiscal, the social, and good governance; and any presumed nominal benefit is a mirage” (p.79). I agree with the author to some extent.

I agree that austerity is certainly not a good policy in economic downturns, but it does bring back fiscal health when public debt levels are unsustainable and default risks are high. The timing and magnitude of fiscal austerity matter; in some cases, it is a last resort and in other cases, it is the only resort given public debt levels. On the sale of citizenship and passports as an economic strategy, I hold the view that net socioeconomic benefits can be derived if the investment inflows are channeled to fund projects and programmes that align with the sustainable development goals and objectives of countries in explicit and measurable ways, through impact investments, and not mere investments in discrete projects.

The book is highly relevant for sustainable development policy and practice in the Caribbean.  The integrative approach, alongside a detailed exploration of major episodes shaping SVG’s socio-political-economic journey, makes the book an important guide for social science students and practitioners seeking to understand not only SVG’s context, but that of the wider Caricom. The author, while acknowledging SVG’s development challenges and limitations, focuses on solutions that are non-theoretical, but pragmatic, logical, workable and importantly, people–centred, which are relevant for other Caribbean economies as well.  Indeed, in many respects, one can substitute SVG for any other Caricom country and the socioeconomic issues, context and policy imperatives would be the same

The book is elegantly written and a fresh and standout contribution to the discourse on sustainable development and economic growth.  It is a must read for development practitioners in the Caribbean, and I highly recommend it!

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