The Benefits and Pitfalls of Artificial Intelligence - AI

The Best Star-Wars Scenario for the Artificial Intelligence (AI) Revolution

AI and the Importance of Regulation from a Star-Wars Perspective

By Carlos Scartascini

While the uses and capabilities of artificial intelligence (AI) continue to grow at a fast pace, the head-long rush into new frontiers could have significant drawbacks.  As Anton Korinek, an AI expert at the University of Virginia, described in a recent blog, AI systems could soon replace relatively unskilled cognitive workers, like people who work in call centers or low-level accountants.  More disruptively, such systems could eventually learn to do more complex tasks, take over robotics and manufacturing, and displace manual laborers and highly skilled cognitive workers, causing wages to crash and inequality and hardship to deepen.

Such a dystopia would not be far from some of the scenarios depicted in Star Wars, that futuristic saga of events in a galaxy far, far away, where worlds of oppression and injustice co-exist with others aiming for a more perfect order.  And as Korinek indicates, a more perfect order is possible.  Indeed, the extent to which AI disrupts the labor market and how much it affects people, may well depend on the degree of regulation governments establish.  Consider as analogies, three different cases from the Star Wars universe.

Anarchic State: The Outer Rim Territories

In the Star Wars galaxy, the Outer Rim Territories often represent a rugged, lawless or less regulated area where the central government’s influence is weak and predators roam.  This can be likened to countries that don’t regulate AI, leading to a kind of anarchy where innovation is unbridled and the risks associated with unchecked AI development abound.  A lack of regulation can spur rapid technological advances.  But it can also lead to ethical dilemmas, misuses of technology, and harm to society, as happens in planets like Tatooine, which is controlled by wealthy and powerful crime lords, but where most inhabitants, including small-town residents and farmers, live in poverty or just scrape by.  Such an imbalance creates a stark contrast between the powerful few and the impoverished majority.  Unfortunately, many countries in Latin America and the Caribbean may end up in a similar equilibrium.  AI in such a scenario would grow, as would productivity and wealth.  But its fruits would benefit only those with access to the means of production, rather than the populace as a whole.

Authoritarian Regulation: The Galactic Empire

The Galactic Empire represents a highly centralized and authoritarian regime where control is exercised over many aspects of life, including technology and scientific advancement.  In this analogy, the Empire’s approach to regulation might create rents — privileges granted by the government in response to lobbying or other manipulation — in the same way that poorly implemented AI regulations could favor certain industries or companies.  This can stifle innovation in other sectors.  It can concentrate power and wealth, leading to inequality and potential abuses of power, akin to how the Empire benefits a select few while suppressing the majority.  Some countries in our region will try to prevent the negative effects of AI.  They will regulate what can and can’t be done with it.  For example, AI may be used to check legal documents, but a lawyer may still need to sign off.  It could be used to diagnose patients, but a doctor would still need to sign the prescriptions.  In other words, to preserve certain jobs, many tasks that could be done independently and unburdened by bureaucracy may still have to pass through physical hands.  Some people will benefit from these rents created by the government.  But those not so lucky to be part of a guild or pressure group may lack access both to the benefits of AI and the government-protected rents.

Balanced Regulation: The Galactic Republic

Before its fall, the Galactic Republic was a democratic union that governed a large portion of the galaxy.  It represents a more balanced and fair approach, striving to benefit all.  This would be akin to well-thought-out policies and regulations that aim to tax excess profits and ensure that the benefits of AI advancements are broadly shared across society.  Such regulation would ideally mitigate risks.  It would promote innovation and fairness, ensuring that AI serves the public good and doesn’t lead to significant societal disparities.  Governments would let AI flourish and achieve its massive potential for increasing prosperity and wealth.  But they would also find ways to redistribute the benefits in ways that maximize welfare.

Choosing the Best Star-Wars Scenario for the AI Revolution

Government decisions will be crucial in determining which of these scenarios characterize countries in Latin America and the Caribbean.  Anarchy and the Empire are not difficult to achieve.  Governments in the region, which have traditionally been known for introducing bad and distorting regulation could easily facilitate one of those two realities.  Becoming the Galactic Republic is much harder.  To reach that more enlightened state, governments have to invest resources to understand the benefits and pitfalls of AI, generate the conditions for its development, and control its excesses.  They also have to develop a strong social safety net, improve the way they levy taxes — when, where and on what — and make significant investments in public goods and infrastructure. Individuals, in the meantime, will have to find alternative ways of working so they can flourish individually and as a group.  Investing in government capabilities to deal with the new realities created by AI is long overdue.  Unfortunately, many governments may be too passive, delaying till it’s too late.  At that stage, there may be only two choices: that of the anarchic state or the state that benefits only the powerful few.

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In The Digital Economy and Culture - It is crucial to ensure that everyone can benefit from connectivity in an era of rapid technological advancement

The digital future is not guaranteed; it gets shaped through the collaborative efforts of all stakeholders involved

Nothing is Fated: Shaping an Equitable Digital Future Must be a Collective Endeavor

By Edgar Cabañas

As Karim Lesina, EVP of Millicom, correctly points out, in the ever-evolving landscape of technology and connectivity, the future is not a predetermined destination awaiting our arrival; rather, it is a realm we actively shape and build together.

The digital future is not guaranteed; it gets shaped through the collaborative efforts of all stakeholders involved.  This sentiment lies at the heart of major telecommunications companies, highlighting the crucial role of collective contributions in steering us toward a future that embraces efficiency, equity, and opportunity.

The indispensable role of collaboration among various actors within the digital ecosystem is a critical factor for success.  From telecommunications giants to policymakers, from innovators to consumers, investors, and development banks, each participant plays a vital role in shaping the trajectory of digitization.

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Additional reading

• Digital Connectivity: Oil for the 21st Century
• The Great Tech Revolution: Artificial General Intelligence & Multilateral Development Bank

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In recognizing this interdependence, telecommunications companies acknowledge that a shared vision is essential for harnessing the full potential of the digital era.

Efficiency and equity are the twin pillars upon which any successful connectivity policy must rest.  It is crucial to ensure that everyone can benefit from connectivity in an era of rapid technological advancement.

This requires deploying robust infrastructure and implementing policies that bridge the digital divide and empower marginalized communities.  By fostering an environment of inclusivity and accessibility, telecommunications companies pave the way for a more equitable digital future.

However, achieving these goals necessitates the concerted efforts of all stakeholders involved.  As key architects of the digital landscape, telecommunications companies bear a significant responsibility in this regard.

By endorsing initiatives prioritizing efficiency, equity, and collaboration, these companies demonstrate their commitment to advancing society's collective interests.

At its core, telecommunications companies reflect a recognition of the transformative power of connectivity.  In an increasingly interconnected world, digitization has the potential to revolutionize every aspect of our lives, from education and healthcare to commerce and governance.

Yet, realizing this potential requires more than technological advancement; it demands a shared commitment to fostering an ecosystem that values inclusivity, innovation, and social responsibility.

As we navigate the complexities of the digital future, we must do so with a collective mindset that transcends individual interests and embraces the common good.  By coming together to chart a course toward a more connected, equitable, and sustainable future, we can harness technology's transformative power to build a world that works for everyone.

The major telecommunications companies serve as a testament to the importance of collaboration in shaping the digital future.  By recognizing the shared responsibility, we all bear in this endeavor, we can work towards creating a more connected, inclusive, and prosperous world for generations to come.

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With Haiti “on the brink of disaster, quick and decisive action” is needed - “to bring the situation under control and to return the country to the Haitian people.”

“for the greater good of the Haitian people.”

PRESIDENT ALI URGES HAITIAN STAKEHOLDERS TO ‘GIVE A LITTLE’

(CARICOM Secretariat, Turkeyen, Greater Georgetown, Guyana) Chair of CARICOM, H.E. Dr. Mohamed Irfaan Ali on Monday [11 March 2024] called on Haitian stakeholder groups to “give a little” to reach consensus on the way forward, “for the greater good of the Haitian people.”

The President of Guyana was at the time addressing the High-Level Meeting on Haiti in New Kingston, Jamaica.

He said CARICOM convened the meeting following intense engagements on Haiti before and after the recent 46th Regular Meeting of the Conference of Heads of Government.

With Haiti “on the brink of disaster”, he said “quick and decisive action” is needed “to bring the situation under control and to return the country to the Haitian people.”

Noting the intense discussions with Haiti’s political sects, civil society and faith-based leaders, President Ali said,

“We’ve impressed upon all the stakeholders that they have a duty to their people to reach a consensus among themselves now…. to attempt to arrive at a consensus around an effective, inclusive transitional governance structure to take the country to general elections in the shortest possible time.”

For CARICOM, “the interests of the people of Haiti are a singular and primary concern,” the Chair said, underscoring the need for both immediate and long-term support to establish “building blocks for political stability and the long -term recovery and development of Haiti.”

On a note of gratitude, President Ali thanked the Meeting host, Prime Minister Andrew Holness for undertaking the good officers’ role in Haiti and facilitating critical talks for the second time in his country.

Describing the yeoman efforts of the other CARICOM Heads, the Chair said,

“I’m extremely proud of the selfless work I have seen personally over the last week, all hours in the night, all in the interest of the Haitian people.  This, I think, is most commendable and speak to the resolve of this Region to find solutions when we are faced with the greatest difficulties.”

The Eminent Persons Group which comprises former prime ministers Perry Christie of The Bahamas, Bruce Golding of Jamaica and Kenny Anthony of Saint Lucia also came in for high praise for their efforts in assisting to forge a path forward among Haitian stakeholders.  The international community too received praise from President Ali whom he said has demonstrated “selfless support” to the Haitian people and CARICOM, as the work continues “for the common good of the Haitian people.”

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How Is Our Biometric Facial Data Protected?

How is biometric facial data stored, and who has access to it?

Face ID: Is our biometric facial data being safeguarded?

By Fabricio Rodríguez

In a world where facial recognition technology (FRT) is rapidly expanding, its use has been increasingly applied in daily situations such as accessing a bank account through a mobile, registering attendance at the office, or authenticating our identity in airports.  Along with this widespread implementation, it also raises significant concerns about the safeguards of the biometric facial data that we provide (or not) to access different services or for other applications.  So, if our biometric facial data is increasingly being used, how is it being protected?

Similar to other biometric data like fingerprints, eye retina or iris, finger veins, or even ear canal recognition, facial recognition is a mechanism that can be used to identify a person, and together with fingerprint recognition, it is currently one of the most commonly used mechanisms of identification.  Facial recognition has experienced rapid growth in its applications and according to Deloitte, the market value of this technology is expected to increase from US$ 3.8 billion in 2020 to 8.5 billion in 2025.

How is biometric facial data captured?

As part of the process that uses facial recognition to authenticate whether we are who we say we are, there is an onboarding process that includes an enrollment phase.  For example, setting up facial identification in your phone.  During the initial setup process, it registers your biometrics, capturing in this case your facial data.  This data is subsequently used for future authentications, providing access not only to the phone but also to apps that might use this feature.

However, facial recognition is not only based on voluntarily provided data for identification.  Years ago, significant controversy arose around a company that collected billions of photos of people based on posts shared on social media to create a database later sold for identification purposes.  According to the New York Times, “Dozens of databases of people’s faces are being compiled without their knowledge”, and this data seems to be collected not only from social media and other websites but also from cameras placed in different places, such as restaurants, for example.

Nevertheless, this same technology has become very important in areas like citizen security, being an increasingly used tool not only by police departments but also in the justice sector by public defenders. 

How is biometric facial data stored, and who has access to it?

As mentioned before, facial recognition has become widely popular for accessing and unlocking mobile devices.  For instance, the iOS face identification system ensures that “Face ID data — including mathematical representations of your face — is encrypted and protected by the Secure Enclave.”  The Secure Enclave is a subsystem integrated into Apple System on chips (SoCs) and is isolated from the main processor to provide an extra layer of security for sensitive data.  iOS explicitly states that “Face ID data doesn’t leave your device and is never backed up to iCloud or anywhere else.”  Essentially, only the user owner of the phone is supposed to have access and can manage their biometric data use and permits.

However, in other cases where biometric facial data is collected (sometimes without prior knowledge), users may not be able to access information on how their biometrics are being stored and its potential uses.

In 2020, during one of the controversies regarding the sale of facial datasets and its impact on people’s privacy rights, Senator Edward J. Markey from the United States mentioned:

If your password gets breached, you can change your password.  If your credit card number gets breached, you can cancel your card.  But you can’t change biometric information like your facial characteristics…

Therefore, to protect the personal biometric data of citizens, including their “faceprint” from other images or videos captured with or without their consent, is not only important but absolutely necessary to ensure correct treatment of data and set limits to its use.  Protocols must be established to guarantee the appropriate handling of this very sensitive information, which, in the wrong hands, could lead to significant harm.

Is there legislation around biometric facial data protection?

While there is still a lack of legislation in many countries specifically addressing the protection of biometric data, some initiatives do exist aimed at defining rules for the treatment of this kind of data.  One of the most important laws in this space is the European Union’s General Data Protection Regulation (GDPR), which establishes a set of rules in this field.

The GDPR classifies biometric information (including facial data) as a “special category” of personal data.  Therefore, compliance with Article 9 is required, which, among other things, emphasizes the need for explicit consent from the data subject to process biometric data.  In 2023, the European Data Protection Board published the Guidelines on the Use of Facial Recognition Technology in The Area of Law Enforcement as an effort to provide relevant information to lawmakers and Law Enforcement Authorities for the implementation and use of FRT.

On the other hand, given that the United States has no federal law on data protection, the State of Illinois enacted a biometric privacy law in 2008.  The Illinois Biometric Information Privacy Act (BIPA) mentions that the subject should be informed in writing that a biometric identifier or biometric information is being collected or stored, and provide authorization.   Similarly, other states like Texas and Washington State have developed biometric privacy statutes.

In 2020, the National Biometric Information Privacy Act was presented to the Senate, as a proposal to regulate this field at a national level in the USA.  According to the US Congress website, this proposal mentions: “A private entity may not obtain an individual’s biometric data unless (1) the entity requires the data to provide a service or for a valid business purpose, and (2) the entity informs the individual in writing of the collection and its purpose and receives a written release.”  In Latin America, various countries have enforced data protection laws, and cases around data protection have arisen.  Some of these countries developed their laws based on the European model, including similar characteristics to those determined by the GDPR.  For instance, the Data Protection Law from Ecuador, adopted in 2021, establishes biometric data as sensitive data.  Therefore, among other rules, it determines that its use and processing are also forbidden without the explicit authorization of the data subject.

What might be done to safeguard people’s rights?

Biometric data, including facial data, will likely continue to expand its applications and use cases.  Therefore, it is necessary for countries worldwide to continue working on specific norms to regulate the way this data is captured, processed, and used.  Even though acts and specific protocols have already been developed in some countries, authorities need to work on strengthening their institutional capacities to guarantee adequate enforcement of these legal frameworks by promoting specialized guidelines, considering the rapid changes in technology, including artificial intelligence that uses facial biometric data as input.

Furthermore, it might be important for authorities to also consider working on FRT-based systems regulations.  This is necessary to prevent bias, discrimination, or other negative effects on citizens as a result of the application of this technology, as seen in various cases around the world.

A robust regulatory framework, coupled with effective enforcement and awareness campaigns, will protect citizens’ biometric data and, eventually, their right to privacy.  It will also establish an adequate environment to promote responsible innovation for the use and applications of FRT, as it can become a very powerful tool for the innovation and economic development when used appropriately.

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A Call on World Governments to Rapidly and Radically Reduce the Gap between the Super-rich and the Rest of Society

Billionaires of the world are $3.3 trillion richer than in 2020, and their wealth has grown three times faster than the rate of inflation 

Oxfam Report

Despite representing just 21 percent of the global population, rich countries in the Global North own 69 percent of global wealth and are home to 74 percent of the world’s billionaire wealth

The world’s five richest men have more than doubled their fortunes from $405 billion to $869 billion since 2020 —at a rate of $14 million per hour— while nearly five billion people have been made poorer, reveals a new Oxfam report on inequality and global corporate power.  If current trends continue, the world will have its first trillionaire within a decade but poverty won’t be eradicated for another 229 years.

“Inequality Inc.”, published today as business elites gather in the Swiss resort town of Davos, reveals that seven out of ten of the world’s biggest corporations have a billionaire as CEO or principal shareholder. These corporations are worth $10.2 trillion, equivalent to more than the combined GDPs of all countries in Africa and Latin America.

“We’re witnessing the beginnings of a decade of division, with billions of people shouldering the economic shockwaves of pandemic, inflation and war, while billionaires’ fortunes boom.  This inequality is no accident; the billionaire class is ensuring corporations deliver more wealth to them at the expense of everyone else,” said Oxfam International interim Executive Director Amitabh Behar.

“Runaway corporate and monopoly power is an inequality-generating machine: through squeezing workers, dodging tax, privatizing the state, and spurring climate breakdown, corporations are funneling endless wealth to their ultra-rich owners.  But they’re also funneling power, undermining our democracies and our rights.  No corporation or individual should have this much power over our economies and our lives —to be clear, nobody should have a billion dollars”.

The past three years’ supercharged surge in extreme wealth has solidified while global poverty remains mired at pre-pandemic levels.  Billionaires are $3.3 trillion richer than in 2020, and their wealth has grown three times faster than the rate of inflation. 

• Despite representing just 21 percent of the global population, rich countries in the Global North own 69 percent of global wealth and are home to 74 percent of the world’s billionaire wealth.
   
• Share ownership overwhelmingly benefits the richest.  The top 1 percent own 43 percent of all global financial assets.  They hold 48 percent of financial wealth in the Middle East, 50 percent in Asia and 47 percent in Europe. 

Mirroring the fortunes of the super-rich, large firms are set to smash their annual profit records in 2023.  148 of the world’s biggest corporations together raked in $1.8 trillion in total net profits in the year to June 2023, a 52 percent jump compared to average net profits in 2018-2021.  Their windfall profits surged to nearly $700 billion.  The report finds that for every $100 of profit made by 96 major corporations between July 2022 and June 2023, $82 was paid out to rich shareholders.

• Bernard Arnault is the world’s second richest man who presides over luxury goods empire LVMH, which has been fined by France‘s anti-trust body.  He also owns France’s biggest media outlet, Les Échos, as well as Le Parisien.
   
• Aliko Dangote, Africa’s richest person, holds a “near-monopoly” on cement in Nigeria.  His empire’s expansion into oil has raised concerns about a new private monopoly. 
   
• Jeff Bezos’s fortune of $167.4 billion increased by $32.7 billion since the beginning of the decade.  The US government has sued Amazon, the source of Bezos’ fortune, for wielding its “monopoly power” to hike prices, degrade service for shoppers and stifle competition.

“Monopolies harm innovation and crush workers and smaller businesses.  The world hasn’t forgotten how pharma monopolies deprived millions of people of COVID-19 vaccines, creating a racist vaccine apartheid, while minting a new club of billionaires,” said Behar.

People worldwide are working harder and longer hours, often for poverty wages in precarious and unsafe jobs.  The wages of nearly 800 million workers have failed to keep up with inflation and they have lost $1.5 trillion over the last two years, equivalent to nearly a month (25 days) of lost wages for each worker. 

New Oxfam analysis of World Benchmarking Alliance data on more than 1,600 of the largest corporations worldwide shows that 0.4 percent of them are publicly committed to paying workers a living wage and support a living wage in their value chains.  It would take 1,200 years for a woman working in the health and social sector to earn what the average CEO in the biggest 100 Fortune companies earns in a year. 

Oxfam's report also shows how a "war on taxation" by corporations has seen the effective corporate tax rate fall by roughly a third in recent decades, while corporations have relentlessly privatized the public sector and segregated services like education and water.

“We have the evidence.  We know the history.  Public power can rein in runaway corporate power and inequality —shaping the market to be fairer and free from billionaire control.  Governments must intervene to break up monopolies, empower workers, tax these massive corporate profits and, crucially, invest in a new era of public goods and services,” said Behar. 

“Every corporation has a responsibility to act but very few are.  Governments must step up.  There is action that lawmakers can learn from, from US anti-monopoly government enforcers suing Amazon in a landmark case, to the European Commission wanting Google to break up its online advertising business, and Africa’s historic fight to reshape international tax rules.”

Oxfam is calling on governments to rapidly and radically reduce the gap between the super-rich and the rest of society by:
 

• Revitalizing the state.  A dynamic and effective state is the best bulwark against extreme corporate power.  Governments should ensure universal provision of healthcare and education, and explore publicly-delivered goods and public options in sectors from energy to transportation.
   
• Reining in corporate power, including by breaking up monopolies and democratizing patent rules.  This also means legislating for living wages, capping CEO pay, and new taxes on the super-rich and corporations, including permanent wealth and excess profit taxes.  Oxfam estimates that a wealth tax on the world’s millionaires and billionaires could generate $1.8 trillion a year. 
   
• Reinventing business. Competitive and profitable businesses don’t have to be shackled by shareholder greed.  Democratically-owned businesses better equalize the proceeds of business.  If just 10 percent of US businesses were employee-owned, this could double the wealth share of the poorest half of the US population, including doubling the average wealth of Black households.

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Human Rights Concerns in The Bahamas

The State of Human Rights and Personal Liberties in The Bahamas

UN Report

Nassau, The Bahamas - The Bahamas has made improvements on preventing arbitrary detentions, but further efforts are essential to advance legislative initiatives and ensure effective and inclusive implementation of the laws, UN human rights experts said today.

"We recognise and praise the efforts undertaken by the Bahamas to address arbitrary detention, through ratification of international human rights instruments and efforts made to strengthen the legislative framework,” said a delegation of experts from the UN Working Group on Arbitrary Detention in a statement at the end of a visit to the country.

“Regular independent oversight over all places of deprivation of liberty is an effective safeguard against arbitrary detention.  We encourage the prompt enactment of the Ombudsman Bill and establishment of the Ombudsman's Office,” the experts said.

According to the Working Group, there are many areas in which improvement is urgently needed.  In particular, the experts expressed significant concerns regarding the frequent absence of arrest warrants, the widespread practice of arrests based on insufficient grounds or outdated warrants, as well as extended periods spent by persons in police custody without notification of charges and timely judicial oversight.

“We are alarmed at reports of police violence to extract confessions, without effective redress mechanisms,” they said.  The experts also expressed concern over disturbing conditions of detention in some sections of the prison and the mixing of detainees awaiting trial and those serving sentences.

The Working Group commended authorities for upholding the presumption of innocence by utilising electronic monitoring devices, as an alternative to detention.  However, they noted deficiencies in the bail system.

“We urge the authorities to significantly improve access to free legal aid by ensuring free legal representation from the moment of arrest, in alignment with international human rights standards.  The Public Defender’s Office should be considerably strengthened,” the experts said.

Commending the Government for progress made in the area of immigration, the delegation expressed concern about the adequacy of current measures relating to asylum and refoulement matters.  They highlighted barriers to legal representation, a lack of awareness of rights, and effective access to legal safeguards.  “We call for a rights-based and non-discriminatory approach to immigration enforcement,” the experts said.

During the visit, from 27 November to 9 December 2023, the three members of the delegation, Priya Gopalan, Ganna Yudkivska and Mumba Malila, met Government officials, officials from the judiciary, lawyers, civil society representatives and other stakeholders.  They visited 10 different facilities, interviewing 134 people deprived of their liberty.

A final report on the visit will be presented to the Human Rights Council in September 2024.

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Why climate finance matters?

It is critical to address the climate finance issues affecting the countries of the Caribbean and the Americas now..

The Bahamas Prime Minister, Philip Davis’ Remarks at the Climate Finance in The Americas Meeting’s Opening Session

OCTOBER 2, 2023

"...let’s not forget that climate finance is ultimately about people, not just numbers on a balance sheet.  It’s about protecting our planet, our communities, and current and future generations from the devastating impacts of climate change.  And, it’s about building a more equitable and inclusive future for everyone, not just the privileged few."

Dear Friends and colleagues, let’s get right to the point.

Everyone in this room is aware of the urgent need to mobilize trillions of dollars in investment to tackle the climate crisis.  We’ve made some progress in recent years, but we still have a long way to go.

So how do we get there?  What do we need to do, starting right now, to mobilize those trillions of dollars?  And how can we work together to make that happen?

From shifting investor preferences to reforming multilateral development banks to tackling currency risks, there are many factors that will determine our success in this endeavor.

But before we dive into the details, let’s take a step back and consider why climate finance matters.

Put simply, we cannot achieve our climate goals without it.  This is true for the developed world, but it is especially true for developing nations.  Whether we are talking about transitioning to renewable energy, improving energy efficiency, or protecting vulnerable communities from the impacts of climate change, all of these efforts require significant investment.

We hear again and again that meeting the climate change challenge is costly.  Something is costly when it does not contribute to the goals we set ourselves, as individuals or as societies.

Climate finance, though, is ultimately about what we, as societies, value; the world we want to live in and the lives and hardships we can save by channeling our money to build resilience against the ravages of climate change.

We need to reform the international financial architecture, including private finance flows and multilateral development banks.

We need to make the current international financial architecture fit for purpose to enable low emissions and climate-resilient investment globally, in every region and in every country.

At COP27, Parties called for a transformation of the financial system and its structures and processes, engaging governments, central banks, commercial banks, institutional investors and other financial actors.  They also called for significant reforms of multilateral financial institutions in terms of financing models, risk appetites, and non-debt instruments.

We’re also seeing new initiatives from the financial sector that highlight the need for scaled-up climate finance.  We’re seeing central banks form coalitions and networks; we’re seeing financial institutions make net-zero pledges; and we’re seeing a growing number of country investment platforms and just energy transition partnerships.

Additionally, a growing number of complementary efforts on reform are in motion, including through the G20, V20, the IMF and other regional forums.

The number of initiatives alone shows how the reform imperative has garnered increasing momentum, but at the same time, how it has fragmented into disparate efforts.  This reality reinforces more than ever the importance of coordination to ensure the whole is greater than the sum of its parts.

Reforms must respond to the need to drive progress across three main areas.

First, we need to drive progress on managing risks to investing in climate action in developing countries.  Where risk is real, we need to deploy at scale the risk reduction instruments – such as guarantees, insurance, and local currency hedging and financing – necessary to unlock capital.  Where risk is perceived, we need to address the biases that hinder investment at scale, and the expectation of high financial returns when engaging on climate change.

Second, we need to drive progress on financing a just and equitable transition.  We need to develop transparent transition plans that shift investment portfolios over time, and that enable ramp-ups in climate investments to the same extent as we see a phasing out of harmful investments.

Third, we need to drive progress on managing the debt crisis.  We need to develop a shared understanding of climate-fiscal-debt links and ensure no country builds up excessive debt because of climate action.

My friends, let’s be candid. The clock is ticking.  We needed change and action years ago.  But now we’re really running out of time.

The Bahamas is an archipelago of 700 islands and numerous cays, spanning thousands of square miles.

Our location means we are highly susceptible each year and in some cases multiple times per year to hurricanes, floods, and rising seas.

When a hurricane devastates the economies of multiple islands at a time, as was the case with Hurricane Matthew, Hurricane Joaquin and more recently Hurricane Dorian, we are left with the daunting task of rebuilding each island’s economy, including rebuilding communities, and damaged infrastructure such as communication networks, water supply, school systems, airports and ports.

It takes us years to recover – and consider this – in under ten years, we have been hit by four separate Category 4 or Category 5 storms.

This traps us in a vicious cycle: 

- We are vulnerable to a warming climate caused by the emissions of other nations;

- Hurricanes made more intense by that warming climate leave behind extreme devastation and a loss of economic activity;

- We are forced to borrow to repair and rebuild, at high-interest rates which reflects our climate vulnerability and our lack of fiscal space to invest in resilience;

And on and on it goes.

In the meantime, our country is considered a high-income country, limiting our access to concessional financing and development aid.

This is an old formula that makes no sense in a new era.  And this is no inconsequential technicality – the high-income designation means we cannot sufficiently invest in our people, our development, and our resilience.

This has to change.

It is critical to address the climate finance issues affecting the countries of the Caribbean and the Americas now.  Our calls for action are strongly articulated in the Declaration of The Bahamas on Climate Finance in The Americas.  This Declaration was negotiated and formally agreed to by OAS member states, and reflects our joint call for global and hemispheric change to the climate finance architecture.

The Declaration of The Bahamas on Climate Finance in The Americas highlights the four key pillars of climate finance:

1 - Enhancing Access through strengthened efforts and collaboration to expand adequate, and direct access to climate finance at scale for all developing countries in the Americas.  This pillar, among other things, also emphasizes the call to move ‘beyond GDP per capita’ to capture climate vulnerabilities in funding decisions in a manner that supports climate-vulnerable countries.

2 - Improving the Terms and Instruments of Finance

Under this pillar, member states stressed the fundamental role of concessional and non-debt finance for the provision and mobilization of resources for assisting developing countries in the Americas in combating climate change.  We also call for enhanced efforts and collaboration to expand affordability of climate finance in the Americas.

3 - Scaling up Towards Adequacy

Here, we jointly call on the Multilateral Development Banks to boost efforts and collaboration to scale up the provision and mobilization of adequate climate finance in the Americas.

4 - Improving Coordination

Under this final pillar, our countries call for enhanced efforts and collaboration by improving accountability and coordination in respect to climate finance.  We call on the Multilateral Development Banks to collaborate with regional and national development banks, as well as United Nations agencies, the OAS, CARICOM, hemispheric and regional intergovernmental organizations and philanthropies, to improve governance and coherence, efficiency and effectiveness of climate finance architecture.  We also call on member states to take steps to advance the calls in this Declaration in relevant fora.

Friends and colleagues, this brings me to my final point: using the global stocktake and the new collective quantified goal on climate finance as pivotal moments to set reforms in motion.

The global stocktake is a process for countries and stakeholders to see where they’re collectively making progress towards meeting the goals of the Paris Agreement – and where they’re not.

It’s like taking inventory.  It means looking at everything related to where the world stands on climate action and support, identifying the gaps, and working together to chart a better course forward to accelerate climate action.

The stocktake is a course-correcting moment, an opportunity to provide a roadmap with ‘solutions pathways’ that drive immediate action.

Some of the key finance pathways could include fostering accountability of non-state actor commitments, and innovative financing models to tackle currency risks.

This is the year we need to establish clarity on how governments, multilateral development banks and international financial institutions, private sector finance institutions and industries will deliver the trillions required.

I emphasize again the urgent need for action on climate finance, and the importance of collaboration and innovation in addressing this complex challenge.

But let’s not forget that climate finance is ultimately about people, not just numbers on a balance sheet.

It’s about protecting our planet, our communities, and current and future generations from the devastating impacts of climate change.

And, it’s about building a more equitable and inclusive future for everyone, not just the privileged few.

I can’t think of more important work.  So let’s keep pushing forward together with determination and purpose.

Thank you very much.

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