The Tribune

By AVA TURNQUEST

Tribune Staff Reporter

aturnquest@tribunemedia.net

FREEDOM of Information legislation is “critical” for economic reform, according to the Inter-American Development Bank’s (IDB) regional economic advisor, who called for greater inclusion of the academic community and wider society on policy matters.

After pumping some $20m into the region for statistical generation, Inder Ruprah told The Tribune the bank has “nothing to show for it”.

He underscored that the regional status quo of inadequate economic growth will not improve unless information gaps are filled to allow for evidence-based policy making.

Mr Ruprah said: “The problem we have is that we’ve been offering grant money to carry out surveys where we find that [information] doesn’t exist in the country, and most Caribbean countries are very reticent to give us permission. So we’re offering grant money to design the survey instrument, we are even willing to hire private firms under their supervision to do this, but a lot of countries say no because we put the condition that the information has to be made available to third party in an anonymous format.”

While he noted that the Bahamas has made considered progress, Mr Ruprah said the reluctance to generate and share economic data was a regional characteristic.

Mr Ruprah said: “Freedom of information is critical. In the Caribbean, there is a problem of known unknowns, and unknown knowns. The first one, known unknowns, is that many of the Caribbean countries, including the Bahamas, don’t generate data that could inform policy making.

“The problem of unknown knowns is that most countries do household surveys, gather census data, routinely. These are normally made available to third parties in an anonymous format so that people can analyse it, discuss it.”

He added: “It’s not just criticism of government but engaging society, academics, students, young people. You get a much richer policy discussion and that should help to getting evidence-based policy making. The generation of data and making that information available to third parties on a routine basis is also important, if you don’t have information, then freedom of information can’t really help you.”

Mr Ruprah spoke to The Tribune ahead of his presentation at the College of the Bahamas on the IDB report, ‘Is there a Caribbean Sclerosis: Stagnating Economic Growth in the Caribbean’ tomorrow.

The report states that the fiscal dominance of political lobbying, and not small economy size, is the main contributor to the poor economic performance of the Caribbean, adding that special interest groups, by their nature, reduce total social gains because of their influence on policy.

It also discusses the region’s inability “to generate enough well-paid jobs for its people”.

As reported by Tribune Business last week, the report revealed that 61 per cent of the tertiary-educated Bahamian labour force had migrated out of the region, and the same for 10 per cent of the secondary-educated Bahamians.

Migration represents a net negative shock to the Caribbean, according to the report, in addition to the social cost of high unemployment and the political implications of lots of well educated unemployed people.

The report highlights three direct factors for the relative decline: a decrease in the number of people working relative to the total population; lower use of capital per unit of labour; and inferior technological progress.

The report read: “The sclerosis hypothesis is that special interest groups devote their resources to unproductive rent-seeking to redistribute social wealth. By enlarging their slice of the pie (real GDP), these interest groups reduce the enlargement (economic growth) of the total pie, which in turn reduces total social gains. This happens by influencing policy.” 

It continued: “Small and politically stable societies like those in the Caribbean foster the development and institutionalisation of growth-retarding special interest groups, which are then better able to influence policy to redistribute resources in their favour. 

“Large discretionary tax expenditure (taxes waived), often used under the banner of industrial policy, could be interpreted as returns to these groups.”

Rent-seeking is described as spending wealth on political lobbying to increase one’s share of existing wealth without creating wealth.

The report added: “Serious policy design needs to delve further into country-specific details that require data and information that are often missing in Caribbean countries. Gathering and disseminating that information must be among the first steps toward finding a solution to the region’s problems, followed by detailed analysis of macroeconomic stabilisation, structural reform and the search for new neighbours.”

The Bahamas, among six countries in the region, is the report’s central focus; however, analysis was also extended to six eastern Caribbean states. The other countries central to the report include Barbados, Guyana, Jamaica, Suriname and Trinidad and Tobago.

Mr Ruprah will present on the publication at 6pm at the Harry C Moore Library at the College of the Bahamas tomorrow.

Speaking to The Tribune, he added: “The Bahamas is a very interesting experiment because with (the) Freedom of Information Act and if the generation of data occurs simultaneously and is made available to third parties on a routine basis, then you’ve started a path that is very different from the tradition.

“The only country that is not a part of this problem is Jamaica. Jamaica invests quite heavily in data generation and makes it available.”