Letter from the Caribbean

On 7 September, Hurricane Ivan, one of the deadliest storms to hit the Caribbean, left a trail of destruction when it slammed into Jamaica, Barbados and other islands caught in its path.

In Grenada, the hurricane claimed the lives of at least 39 people and left 90% of the homes damaged or destroyed. Grenada's economy, which mostly depended on tourism, was paralysed. Even worse, the tiny island's balance sheet, which was now showing positive signs of recovery, completely keeled over.

In a recent report, the island's Finance Ministry estimated losses due to destruction and lost tourism business at US$900m. Unofficial estimates to rebuild stand at TT$15bn.

At an Investors Forum in Miami in late September, organised by RBTT (a banking giant in the Caribbean), Sir Dwight Venner, Central Bank governor, Organisation of the Eastern Caribbean States, summed it up when he noted that Grenada's experience pointed to the need for regional integration since, without the support of Caricom, the island would not have been able to revive its economy.

Grenada Prime Minister, Dr Keith Mitchell, hit the nail on the head at a press conference in Trinidad, saying the hurricane had brought the Caribbean together.

Days after the hurricane struck and reports detailing the extent of the damage coming out, the Caribbean governments and the private sector rallied their forces and came to the assistance of those whose lives had been turned upside down.

Trinidad & Tobago's Prime Minister, Patrick Manning, who visited Grenada and Jamaica in the aftermath of Ivan, wasted no time in trying to get Grenada back on its feet. Trinidad & Tobago, being the financial hub of the region, puts its stamp on recovery efforts.

Manning pledged TT$10m to assist with relief efforts and obtained his Government's approval for a further TT$20m in aid to Caribbean countries, including Cuba and St Vincent and the Grenadines. He followed that up with a TT$300m poverty alleviation fund to encourage the growth of regional businesses to strengthen their economies.

In addition to Trinidad & Tobago, Venezuela, Columbia, France, the European Union, Barbados and the UK have all been assisting Grenada.

Even businessmen in Antigua and Barbuda dug into their pockets, sending over 3,000 pounds of food and supplies to Grenada via Caribbean Star Airlines, a regional outfit.

'It is important that we put Grenada back on its feet in the shortest possible time and, in particular, economic activity begins to take place in the country again,' Manning told reporters at a press conference in Port-of-Spain after visiting Grenada.

President of the Trinidad & Tobago Chamber, Christian Mouttet, responding to calls by Grenadian businessmen for line of credit with Trinidad & Tobago's private sector, has assured that they can go down that route.

Just to give an idea of how important it was to get these islands back from the brink, one need look no further than the newsletter put out by the Republic Bank, the second largest bank in Trinidad & Tobago.

Reduced purchasing power

'Last year,' the newsletter said, 'Grenada, Jamaica and St Vincent and the Grenadines accounted for TT$308m, TT$2,195m and TT$208m respectively of Trinidad & Tobago's exports.' With these economies on the ropes, it stated that exporters could be facing hard times as these countries' purchasing power would be reduced.

'Altruism aside, Trinidad & Tobago has vested interests in ensuring that these economies rebound as quickly as possible,' the bank stated.

Anthony Aboud, President of the Trinidad & Tobago Manufacturers Association (TTMA), was on the same page when he emphasised that while Trinidad & Tobago's gestures were humanitarian, economic activity was necessary for these islands to regain their purchasing power.

'We have to see now how we can restore the business system, because we have to build Grenada once again,' he said. Noting though that there was need for more private sector intervention, Aboud pointed out that there was an agreement between the Grenadian Government and a Trinidad & Tobago company to build a galvanised iron plant there.

Carib Brewery, a subsidiary of the ANSA McAL group of companies, will soon start producing Carlsberg in Grenada, ensuring more jobs.

As a result, Trinidad & Tobago's corporate sector took Grenada and Jamaica into its fold. RBTT contributed some TT$1m to Grenada's recovery efforts. The bank pledged some US$250,000 to get Jamaica back on the road. The bank even set up a line of credit of J$150m and granted a moratorium on their principal payment for up to six months.

But the Caribbean was not the only one to come to Grenada's assistance. In a visit to the island on 6 October, US Secretary of State Colin Powell pledged US$100m to assist with recovery efforts. The World Bank, too, chipped in with US$10m to help hurricane-ravaged islands pick up the pieces.

Rory Rostant is editor of business magazine Newsday.