Washington consolidating its economic influence in Caribbean

 Last weeks issue highlights include:

– Washington consolidating its economic influence in Caribbean
– Mottley calls for new Caribbean financing facility to aid restructuring 
– Guyana and Exxon reach agreement on US$9bn Payara project 
– Barbados-China relations attract attention 
– Cuba’s Central Bank introduces restrictions on import and export of dollars 
– Dominican Republic issues US$3.8bn in sovereign bonds 
– In Guyana, Zijin denies accusations of replacing local staff with Chinese workers 
– Moïse appoints provisional electoral council as US calls for elections in Haiti 
– Cayman borders open on 1 October but cruises not likely to call until 2021 
– CARICOM Travel Bubble launched 
– Bahamas applies for FATF rerating in hope of removal from grey list 

A two day visit to Guyana and Suriname by the US Secretary of State, Mike Pompeo, has cemented a new economic and security relationship with Guyana’s government, and has begun to deepen relations with Suriname, reinforcing Washington’s objectives in the Caribbean. 

Visiting both countries, the US Secretary of State, Mike Pompeo, sought to bolster the role of US corporations in infrastructural development, offset Chinese economic and political influence, and to link regional security and humanitarian concerns to the internal situation in Venezuela. 

The visit, which also took Pompeo to Colombia and the northern Brazilian city of Boa Vista, was intended to demonstrate Washington’s willingness to partner in delivering economic change in likeminded hemispheric democracies. 

During his stay in Guyana, Pompeo met with Guyana’s new President, Irfaan Ali, and other leading members of his government, signing a number of agreements, including a ‘Growth in the Americas’ memorandum of understanding. Guyana is the second Caribbean country to sign such a document, the other being Jamaica. 

The agreement is intended to provide finance and to support US private sector investment in the development of physical infrastructure, the energy sector, renewables, and the digital economy. 

Guyana also agreed to increase US private sector awareness of ‘strategic energy and other infrastructure projects in Guyana’ and to explore ‘potential financial support from the US International Development Finance Corporation, the Export-Import Bank of the United States and the US Trade and Development Agency to facilitate private sector participation and investment’. 

 It is also expected that the US Treasury, working jointly with the Ministry of Finance of Guyana and other ministries and institutions, will explore the development of financial capacity-building and technical collaboration programme’ according to the agreement. More generally the document signed seeks to address and overcome institutional, and market barriers ‘impeding the flow of private capital solutions’. 

According to President Ali, the agreement will pave the way for the US private sector to expand their investment portfolio and partner with the Guyanese private sector. It is expected that a joint working Group will be formed and meet shortly. 

The two sides also agreed to activate an existing bilateral ‘Shiprider Agreement’ that enables joint maritime and air patrols involving US and Guyanese personnel participating in each other’s patrols in order to interdict narcotics shipments and monitor infringements of Guyana’s territorial air and sea space. Several Caribbean countries have similar agreements. In Guyana’s case the agreement is supported by the recent donation of US$0.2m in equipment and patrol boats to strengthen the Republic’s ability to patrol its own territorial waters as well as the further development of information sharing and training. 

During the visit to Guyana, the US agreed to provide Guyana with additional humanitarian assistance to support its ability to address the needs of refugees crossing the border from Venezuela, and Pompeo also met with US oil company executives operating in Guyana. In addition, instead of side-lining CARICOM and in apparent recognition of the regional body’s multilateral role, the US Secretary of State met with the CARICOM Secretary General, Irwin LaRocque. 

Indirectly referencing China, a major investor in Guyana, Pompeo noted during his visit, that the United States objective was to encourage investments “without political strings tied to them or engaged in activities that are corrupt”. 

Responding to this and other US comments and pre-visit briefings, the Chinese Embassy in Georgetown said in a statement that its relations with the Caribbean, including Guyana, were based on the principles of mutual respect, equality, and mutually beneficial win-win cooperation. ‘China attaches no political strings in bilateral pragmatic co-operations which bring tangible benefits to countries and peoples in the region. This is an objective fact that anyone without prejudice will admit’ the statement said. 

In Suriname, in contrast to the fulsome welcome received in Georgetown, a warm but noticeably more cautious President Santokhi, spoke only about the possible deepening political dialogue, reviewing bilateral ties and cooperation, and exchanging views on international and multilateral development. He outlined to the media the possibility of future bilateral cooperation in trade and investment, combating transnational organised crime, health, US investment in the country’s military and defence, and support for the administration of justice and policing. 

Santokhi said that in addition to agreeing to strengthen political dialogue and pursue the issues discussed, a designated team from the US State Department and Suriname’s Ministry of Foreign Affairs will meet soon to expand on the matters discussed. 

Responding to Suriname’s new President, Pompeo focussed on the visit being a sign of growth in the ties between the US and the Caribbean, and the importance of a future constructive partnership based on democratic values, the protection of human rights and deeper economic relationships. “The United States is eager to partner to ensure that (economic growth is) sustainable, that it benefits all people, and brings our nations closer together”, Pompeo told the same press conference. He also noted the willingness of the US to provide security assistance where needed and help access financing from multilateral institutions. 

The visit and the language used before and during the two visits suggests that the Trump Administration’s policy is now well advanced in consolidating the support of the majority of Caribbean governments for its concerns. Deploying subtlety and softer language, Washington in recent months has begun to deliver a Caribbean policy which better recognises Caribbean sovereignty and places emphasis on delivering mutual economic benefit through stimulating the closer involvement of US corporations. 

Pompeo’s previous visits to Jamaica and the Dominican Republic, meetings with invited Foreign Ministers, and the earlier invitation to selected CARICOM nations to meet with President Trump, suggest that now only Barbados, Trinidad, St Vincent, Dominica and Antigua, remain to be convinced by US overtures. 

In recent months Washington has deployed language that suggests a greater awareness of the Caribbean’s nuanced views on China and Venezuela. 

This newfound subtlety was in evidence in a non-attributable background briefing by a senior State Department official prior to Mr Pompeo’s visit. 

In answer to a journalist’s question, the official said that the US was not saying do not deal with China. “We deal with China and other countries deal with China. They’re a big economy. There’s really no choice but to deal with them. But what we are saying is when you deal with them, make them deal on transparent, 21st century, above-board terms, not on the sort of 19th century imperialist, mercantilist, opaque terms that Chinese Communist Party and Chinese businesses owned by the – owned or controlled by the Communist Party seem to favour”, he said. 

The senior official also urged countries to look at their security interests. Venezuela by harbouring ‘terrorists and narcotraffickers’ made it in “Guyana’s own interest …to try to work together (with the US) to try to resolve the crisis in Venezuela”, he observed. 

Speaking in Guyana and Suriname, Mr Pompeo said that the US will put no political pressure on countries to accept tenders from US corporations. Instead he indicated that Washington had a significant interest in participating in the far reaching strategically important economic transformation that is beginning to take shape in the two countries. 

Such statements suggest that the US has developed a strategy intended to increase its economic dominance in the Caribbean, not just at the expense of China and Venezuela, but in relation to the EU and other global players as well through a new interpretation of the Monroe doctrine. 

This is a lead article from Caribbean Insight, The Caribbean Council’s flagship fortnightly publication. From The Bahamas to French Guiana, each edition consists of country-by-country analysis of the leading news stories of consequence, distilling business and political developments across the Caribbean into a single must-read publication. Please follow the links on the right-hand side of this page to subscribe, or access a free trial.