Trying to keep pace with changes
BARBADOS?HAS?BEEN?CAREFUL in building its reputation on the basis of international best practices of financial regulation and supervision, but keeping up with changes in that area has been a great challenge, says Central Bank of Barbados Governor Dr DeLisle Worrell.
Worrell told dozens of participants at an international business and financial services sector conference at the Lloyd Erskine Sandiford Centre last week that the ongoing global economic meltdown had exposed inadequacies in international financial oversight, and efforts to devise international institutional arrangements to prevent a repeat were still under way.“
In the eyes of many, including myself, these efforts have hardly begun to address the financial dysfunction which was and still is at the root of the financial crisis.
“The Basel Committee on Banking Supervision has issued revised guidelines for banks, which remain the subject of debate. In other financial subsectors, the needed reforms have yet to be codified and discussed,” the country’s lead economic advisor noted.
He said the Financial Stability Board (FBS) which the Group of 20 countries set up some years ago to coordinate those efforts had so far “not gone beyond checking on legislation and information systems to address the analytical causes of financial instability”.
Worrell said it was therefore important for Barbados to participate actively in an exercise of “international financial reform” with regional partners and other countries which offered international business and financial services.
“This requires us to up our game in a collaborative exercise between regulators, official agencies and market participants.
“We must not find ourselves any longer in the position of followers, reacting to initiatives, mostly threatening, that originate in the OECD and G20, of which we are not members,” Worrell said.
The Central Bank Governor said Barbados had to find ways “to move the initiative for financial reform back on the agenda of the IMF, were we do have a voice.”
The economist said this country had already taken some steps towards “a strategy along those lines, and we must build on these foundations”.