The strategic message behind US-Caribbean relations: Russia and China should not be invited to the Caribbean …

On 29 April 2022, Kamala Harris met with a number of political leaders to discuss the furtherance of relations between the United States and the Caribbean.  Topics in the closed-door meeting supposedly ranged from immigration, trade, and climate change.  The discussion reportedly leads up to next month’s Summit of the Americas, a meeting of Caribbean and Latin American leaders with the reported purpose of addressing economic, political, and these days, climate challenges impacting the region.

I note here that former U.S. senator Christopher Dodd met with the leaders of CARICOM member states reportedly on the issues of climate change, energy security, and disaster preparedness.    

From a narrative perspective, given the economic leverage the United States has in the western hemisphere, last week’s meetings and next month’s forum is about getting the rest of the region “on code” as to the wants and needs of the United States. 

Given the American perception that an emerging People’s Republic of China and an ever-pesky Russian Federation pose economic and political threats to the United States, the United States has to craft and transmit a narrative that the Caribbean can itself adapt and spread among its constituents.   

The most recent example of Chinese threats to United States’ hegemony in the Caribbean region is the new republic of Barbados’ willingness to establish a relationship with China as indicated by Barbados membership in China’s Belt and Road Initiative. 

Barbados recently became a republic, ditching Queen Elizabeth II and installing its own elected president.  This change in the head of state comes with a declining level of United Kingdom investment in Barbados currently pegged at approximately USD 5 billion.

China’s investment in Barbados reportedly exceeds the U.K.’s amount although China has a way to catch up with U.S. investment in Barbados which stands around USD 45 billion.

U.S. concerns with Russia appear to be more along the lines of political and military threats than China’s economic threats.  The U.S. is concerned that Russia is leveraging security deals with Cuba, Nicaragua, and Venezuela in order to straighten its posture in America’s backyard.

Politically, Russia’s support of authoritarian-populist regimes in Latin America poses a challenge to the U.S. political philosophy of democratic elections and private ownership of capital.

I am not privy to what Ms Harris shared with Caribbean leaders in their closed-door session.  I don’t think that Caribbean leaders took Ms Harris’ opening remarks as a pledge of altruism.  Like any holder of monopoly power, where there is a threat of entry, the monopolist offers special services or discounts in order to keep customers loyal while taking steps to kick new entrants out of the market.

If Ms Harris made this kind of appeal behind closed doors, then her strategic messaging was on point.  The goal of strategic messaging is to maintain optimal political positioning.  Optimal political positioning for the United States means maximizing sought after benefits such as a minimally challenged trade position in the Caribbean region and securing firmer support for Ukraine as that country attempts to repel an invasion from Russia. 

The Caribbean reaction from has been mixed,  While the majority of Latin American and Caribbean countries opposed Russia’s invasion, most have been ambivalent about imposing sanctions even though their trade with Russia is overall minimal.

Alton Drew

1 May 2022

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Remarks by Vice President Harris in a Virtual Meeting with Caribbean Leaders

THE VICE PRESIDENT:  Good afternoon, everyone.  Good afternoon.  Thank you all for joining us today for this very important meeting.  I am Kamala Harris, and I’m pleased to welcome you all to this conversation and this convening.

As a neighbor in the Western Hemisphere, the United States shares a common bond with the nations of the Caribbean.  As neighbors, we know our partnership is key to our shared prosperity and security. 

We also know that we have common challenges.  And that is why I’ve convened this meeting: to strengthen our partnership and chart a path forward together.

As we all know, our nations have extensive people-to-people ties.  Millions of Americans have Caribbean heritage.  Millions of Americans travel to the Caribbean each year for vacation, to visit friends and family, and to engage with the richness of that history.

From South Florida to New York and beyond, Caribbean culture has become a meaningful part of American culture.  And we are all grateful for that. 

At the same time, we recognize that we find ourselves collectively in a challenging time.  The pandemic has upended so many aspects of our lives and the lives of our people.  And economic recovery has been difficult and uneven for so many in this region. 

There is also an existential threat we collectively face in the climate crisis, and we are acutely aware that the world’s emissions have an outsize impact on the Caribbean.

In light of this, I want to be clear: The United States is committed to you, our neighbors, and we will take on these challenges together. Convenings like this haven’t happened very often.  So, today, as a demonstration of our administration’s commitment, I propose this be an annual meeting.

We have, of course, today, a lot to discuss.  And there are three areas in particular that I will ask us to focus on — areas that I know are a priority for many of you: economic recovery, security, and climate and energy.

On the issue of economic recovery, the United States is the Caribbean’s biggest economic partner.  This partnership benefits the economy of the United States just as it benefits your economies.  So we will explore today how we can strengthen that economic partnership.

On the issue of security, I know for many of you that you are particularly concerned about the trafficking of drugs and guns, and the associated violence.  That is why today’s agenda includes a discussion of additional funding and other support the United States can offer to reduce violence in the region.

And third, we will discuss the urgent issue for our entire planet: the issue of the climate crisis.  In particular, we will discuss ways to strengthen your climate resilience and to accelerate the transition to a clean energy economy. 

Your input will help guide the United States’ effort in the days and months ahead.

To each of you: I thank you for being here, and I thank you for the work we have done and will continue to do together.  I look forward to our discussion today and to our gathering in Los Angeles at the Summit of the Americas in June. 

Thank you to the members of the press who are watching these opening remarks.  We will now proceed with the rest of our meeting.  Thank you.

                             END                4:41 P.M. EDT

Source: The White House

The Caribbean: Foreign exchange rates as of 10:50 am AST

Currency Pair14 March 202215 March 202216 March 202217 March 2022
USD/BSD1.00001.00001.00001.0000
USD/JMD151.469151.847151.451151.49
USD/HTG105.441105.114104.584104.887
USD/DOP54.587554.510754.42454.4181
USD/XCD2.70002.70002.70002.7000
USD/BBD2.00002.00002.00002.0000
USD/TTD6.645496.665676.653046.66022
USD/GYD199.77200.46200.121200.334
USD/VEF428,490.0428,249425,659423,634
Dollar Index98.9198.6798.5998.10
Sources: OANDA, MarketWatch

Interbank Market News Scan: Foreign exchange rates of interest to Atlanta’s immigrant community as of 7:50 am EDT…

Business News

EUR/USD=1.13649

GBP/USD=1.36048

USD/CAD=1.27003

USD/INR=74.9424

USD/NGN=415.459

USD/GHS=6.44983

USD/DOP=56.2751

USD/JMD=155.493

USD/GYD=200.426

USD/TTD=6.65983

USD/XCD=2.70

USD/BTC=0.00002

USD/ETH=0.00033

Source: OANDA

Dollar Index=95.81

Source: MarketWatch

What could bitcoin represent to the Eastern Caribbean trader? Actual underlying trust and societal efficiencies …

If I traded a bitcoin for an Eastern Caribbean dollar, I would receive, according to data from OANDA, EC118,665. (Forgive me for using “EC” versus “XCD”. I am old school). If I then attempt to transact business in the United States or Europe, what could that bitcoin buy for me?

According to the website Decrypt, there are a growing number of vendors that accept bitcoin in exchange for their products. The categories include:

Used automobiles;

Private aircraft;

Houses;

Real estate investment trusts;

High-fashion clothing;

Restaurant food;

Virtual private networks and web services;

Booking hotels and flights; or

Commodities (gold, silver, platinum, etc.).

To profit from the aforementioned trade, I would wish to purchase goods and services that I would not be able to get in the Eastern Caribbean; purchase items at a cost lower than what I would face in the Eastern Caribbean; or, at the end of the day, convert that bitcoin into EC greater than EC118,665.

More importantly, as an independent trader, I could finance directly trade that I enter into with vendors in countries that accept bitcoin as legal tender, such as El Salvador. Rather than going to a bank and converting my EC for El Salvador’s colon, I could pay an El Salvador vendor directly with bitcoin, the country’s other legal tender.

Bitcoin could represent greater efficiency in trade between countries by turning a trader with the financial wherewithal into a “mini-bank.” The value of the currency he uses for trade, bitcoin or some other crypto, would be based on the underlying value of his services, goods, or knowledge, rather than on the general good faith and trust underlying fiat currencies. Blockchain ledger characteristics aside, a cryptocurrency capturing the trader’s reputation, insights, knowledge would go a much longer way with me where I can put together and engage with my own mini-community of traders in the goods and services I listed above. I could put together a community of actual producers and deal efficiently and directly with them, cutting out unnecessary middlemen along the way.

Could society benefit from such direct-financed trade? I think yes, particularly where cost savings flow to retailers and end-users. Eastern Caribbean traders should explore this model.

Alton Drew

02.17.2022

Foreign exchange rates of interest to Atlanta’s immigrant community as 6:44 am EDT …

EUR/USD=1.13684

GBP/USD=1.35643

USD/MXN=20.3469

USD/GTQ=7.52098

USD/NGN=415.318

USD/GHS=6.47201

USD/INR=74.9746

USD/XCD=2.70

USD/DOP=56.479

USD/JMD=155.725

USD/GYD=200.6

USD/BTC=0.00002

USD/ETH=0.00032

Source: OANDA

Dollar Index=95.81

Source: MarketWatch

Interbank Market News Scan: Libor coming to an end. China’s RMB hopes to take out the dollar …

9 July 2021

Foreign exchange rates of interest …

Currency pairExchange rate
USD/XCDXCD 2.70
USD/MXNMXN 20.0188
USD/JMDJMD 148.6230
USD/DOPDOP 56.6164
USD/HTGHTG 92.0194
USD/NGNNGN 411.2120
USD/GHSGHS 5.9153
Source: OANDA

News links of interest …

Interbank. With the end near for the London Interbank Offered Rate (Libor), the Reserve Bank of India (RBI) on Thursday told banks and other financial institutions to stop using the benchmark as soon as possible and mandatorily by December 31 and move to any Alternative Reference Rates (ARR). https://www.business-standard.com/article/finance/rbi-to-banks-phase-out-libor-soon-move-to-alternative-reference-rates-121070900016_1.html

Interbank. The booming collateralized loan obligation market faces a chaotic end to 2021, when the benchmark London interbank offered rate is retired for new loan contracts. https://www.bloomberg.com/news/articles/2021-07-08/growing-clo-market-has-a-libor-transition-problem-on-horizon?sref=oriheOus Interbank. Sri Lanka’s central bank said it will dip into its foreign exchange reserves to partly repay $1 billion of bonds maturing later this month, seeking to allay investors’ concern about a possible default. https://www.bloomberg.com/news/articles/2021-07-08/sri-lanka-keeps-rate-on-hold-as-focus-shifts-to-debt-repayment?sref=oriheOus

Foreign exchange, China. The following are the central parity rates of the Chinese currency renminbi, or the yuan, against 24 major currencies announced on Friday by the China Foreign Exchange Trade System: Market exchange rates in China — July 9 – Xinhua | English.news.cn (xinhuanet.com)

Foreign exchange. Could the RMB dislodge the dollar as the world’s reserve currency. Could the RMB Dislodge the Dollar As a Reserve Currency? – BRINK – Conversations and Insights on Global Business (brinknews.com)

Cryptocurrency.  Why China wants to undermine Bitcoin. Currency and control: why China wants to undermine bitcoin (msn.com)

Cryptocurrency.  The future is far from stateless. Cryptocurrencies’ dream of escaping the global financial system is crumbling | Quinn Slobodian | The Guardian

Interbank Market News Scan: Eastern Caribbean, foreign exchange …

2 July 2021

Foreign exchange rates of interest

Where base currency is XCDRates as of 9:30 am AST 2 July 2021Where term currency is XCDRates as of 9:30 am AST 2 July 2021
XCD/EUR0.3125EUR/XCD3.2000
XCD/GBP0.2686GBP/XCD3.7231
XCD/USD0.3704USD/XCD2.7000
XCD/CAD0.4596CAD/XCD2.1754
XCD/NGN152.1010NGN/XCD0.0066
XCD/CNY2.3938CNY/XCD0.4174
XCD/PLN1.4111PLN/XCD0.7081
XCD/PEN1.4229PEN/XCD0.6963
Source: OANDA

Eastern Caribbean Central Bank-interest rates

ECCB Fixed Deposit Rate-1 month0%
ECCB Fixed Deposit Rate-2 months0%
ECCB Fixed Deposit Rate-3 months0%
*ECCU Minimum Savings Deposit Rate2%
ECCB Discount Rate2%
Source: Eastern Caribbean Central Bank

Links to follow …

Eastern Caribbean Central Bank. The Eastern Caribbean Central Bank (ECCB) recorded a net profit of $25.2 million for the year ended 31 March 2021, a 60.1 per cent decrease from the profit reported in the prior year. https://www.eccb-centralbank.org/news/view/eccb-records-profit-for-financial-year-2020-2021

European Central Bank. The European Central Bank (ECB) and the European Systemic Risk Board (ESRB) today published a joint report that takes a closer look at how a broadened set of climate change drivers affects millions of global firms and thousands of financial firms in the European Union (EU). https://www.ecb.europa.eu/press/pr/date/2021/html/ecb.pr210701~8fe34bbe8e.en.html

Interbank. The yuan’s share of the world’s central banks’ reserves is at 2.45%. https://illinoisnewstoday.com/chinese-yuan-share-of-world-foreign-exchange-reserves-hits-new-highs/279603/

Interbank. The Central Bank of The Bahamas says the restrictions placed on foreign exchange outflows at the onset of the economic crisis caused by the COVID-19 pandemic will end this week. https://www.nycaribnews.com/articles/foreign-exchange-restrictions-eased-in-bahamas/