The head of the Eastern Caribbean Central Bank (ECCB) is calling out commercial banks in the sub-region for being too slow to lend to business interests, saying that locking away such large sums in vaults serves no useful purpose.
Governor Timothy N.J. Antoine argues that the time has come for a new approach to lending to medium and small businesses, as the system is sinking under the weight of more than $10 billion in liquid cash in bank vaults.
“We have excess liquidity,” the governor told invitees to a recent ban function as he announced a “big push” drive strategy aimed at accelerating economic growth and transformation across the sub-region’s currency union through the unlocking of hundreds of millions in credit to needed areas. The drive would include expanding the bank’s partial credit guarantee program, designed to reduce lending risks for commercial banks and encourage them to extend credit to underserved areas. The ECCB can provide up to 80 % guarantees on loans, reducing the risk exposure of commercial banks.
So far, about 300 such loans have been approved under the “big push” initiative. “We are just getting started.” The loans amount to about $12 million
“The Big Push is not a panacea, and it is not the responsibility of the ECCB alone. After all, the ECCB by itself does not produce growth. We create the conditions that make growth possible. We keep the EC dollar strong, we safeguard the financial system, we build confidence, but growth itself must be generated by our businesses, by our people, and by our governments. Our governments, in particular, must provide the enabling environment and deliver critical infrastructure,” he stated.
He said the regional economy could be doubled over the next decade if the “big push” is implemented properly. “It is not growth for growth’s sake but for diversifying our economies. Above all, it is about people. It is more than numbers, but about lives and livelihoods.”
