‘CLICO fix needs community effort’
CARICOM must now lead the hunt for a solution as Barbados and countries in the Organisation of Eastern Caribbean States struggle to find their way out of the protracted and worrying CLICO “cul-de-sac”.
The regional grouping’s current chairman, St. Lucia Prime Minister Dr. Kenny Anthony, made that appeal today, saying given recent developments where plans to have a government-backed bond had to be abandoned, required such “catalytic” action.
He voiced his concerns today while speaking on the topic Regional Integration: Reality Or Myth? at a Barbados Chamber of Commerce and Industry luncheon at Hilton Barbados.
Anthony said “the ongoing hiatus regarding the settlement of CLICO obligations in the Eastern Caribbean” was a source of concern to him.
“We had hoped that following the relatively satisfactory outcome achieved in Trinidad and Tobago there would have been greater impetus to resolve the OECS side of the portfolio,” he said.
“Indeed, for a while there appeared to be a particularly suitable window of political opportunity to achieve this. It will be recalled also that there was the commendable suggestion of a government-backed bond which appeared to be one possible route out of the current cul-de-sac.
“That approach has faltered as potential bond investors are nervous to place any value on certain guarantees in view of the current economic plight of regional governments.”
As a result, he said “perhaps CARICOM can take a catalytic role using its neutrality, objectivity and super national reach to help engineer a suitable outcome”.
Last week Deloitte Consulting Ltd., judicial manager for collapsed CLICO International Life Insurance Company, said it was pursuing a restructuring plan approved by the Barbados High Court partly because of difficulties related to the viability of the bond solution Anthony referenced.
“The judicial manager reported that it had examined and explored several funding options with regional governments including most recently the possibility of issuing of a bond backed by sovereign guarantees from Barbados and Eastern Caribbean governments,” Deloitte said in its update.
“However, after further consultations with regional governments and potential investors, this option was deemed not to be viable given current market conditions… In view of these considerations the Judicial Manager believes that the proposed restructuring plan is the best option available for policyholders at this time. (SC)