The United States has always enjoyed stable and productive relations with the Caribbean, but those bonds are set to get even stronger following a recent diplomatic mission that signalled new interest in investing in the region. The Overseas Private Investment Corporation (OPIC) went on a whistlestop tour of the Caribbean in May, visiting five countries in four days. One of those countries was Saint Lucia, where the US delegation met with Prime Minister Chastanet and others to discuss possible areas of collaboration and investment.
Kristie Pellecchia, OPIC’s Senior Advisor for the Western Hemisphere, was part of the US team and told STAR Businessweek that the investment agency is looking to “explore industries that are important to the people and growth of Saint Lucia”, adding that the delegation was impressed with what they saw in the country: “We left with a strong sense of the community’s commitment to growth and entrepreneurial spirit.”
Playing politics
OPIC is a US Government agency that links American businesses with investment opportunities in emerging markets. It provides loans, risk insurance and other financial assistance, with the dual purpose of growing US business and promoting US foreign policy. It was formed in 1971 and operates in nearly 100 countries worldwide. OPIC’s Caribbean portfolio includes more than US$ 250mn in a variety of projects including power generation, agriculture and small business lending. In Saint Lucia, the group has facilitated investments in the cocoa industry, hotels and manufacturing.
“We have a strong commitment to supporting investment in our neighbouring countries in the Caribbean,” says Pellecchia. “OPIC can help the Caribbean by providing financing to projects that have a strong business plan but that may not have full access to the capital markets in order to achieve the full financing needed.
“We share a commitment to freedom, peace and security, and we know that by investing in development, we advance those goals throughout the region.” OPIC may be focused on investment, trade and boosting the US private sector but it’s also a political body, at least partly motivated by political concerns. The recent Caribbean delegation came on the heels of President Trump’s March meetings with Caribbean leaders and, much like those closed-door discussions, was widely touted as a sign of closer US-Caribbean relations.
Rather than sending representatives, OPIC’S Acting President and CEO David Bohigian led the Caribbean trip, sending a clear message that these were high-profile talks, taken seriously by the US government. The selected itinerary of Jamaica, the Bahamas, Haiti, Dominican Republic and Saint Lucia was also done with careful planning and forethought, those being the same five countries that met with Trump in Florida. Pellecchia says, “The trip was conducted at the request of President Trump to send a high-level delegation from OPIC to the region. Acting President and CEO Bohigian led the delegation to explore investment opportunities in energy and other critical sectors, and strengthen relationships with countries who are key partners in fostering stability and security in the Western Hemisphere.”
Caribbean leaders faced some hostility following the March meeting, both at home and abroad, for engaging in talks with the controversial President but remained resolute. Prime Minister Chastanet told naysayers: “I was elected by Saint Lucians to represent Saint Lucians. The topics that were discussed are of national, as well as regional, importance. If I’m invited to put forward Saint Lucia’s agenda, I will happily accept.”
Addressing parliament, he added: “Saint Lucia is always looking to strengthen our relationships with longstanding allies such as the United States. The President and his team were very much in listening mode. Ultimately we had a very promising meeting and I am excited about the discussions we had.”
Saint Lucia stop
Saint Lucia was the last leg of the trip for the OPIC delegation, which was given a tour of Vieux Fort and the marine terminal at Cul-de-Sac Bay before getting down to business. Discussions centred around energy (including the potential of LNG), infrastructure, water, security and women’s empowerment. And it wasn’t just government round the table; industry also had a presence with representatives of the Chamber of Commerce, Industry and Agriculture attending.
“We met with the prime minister and senior government officials [and] we also held meetings with entrepreneurs to understand the investment landscape and their concerns,” says Pellecchia.
One of the top items on the agenda was transportation — an ongoing concern for Saint Lucians contending with heavy traffic and inadequate roads. The delegation discussed the possibility of establishing toll roads to improve traffic flow and also looked at how Saint Lucia’s existing air and sea facilities serve the country’s biggest industry, tourism. Developing the port area and expanding the cruise terminal in particular are projects of interest to overseas investors.
With a revamp and renewed funding, OPIC stands to become an even more significant FDI partner for Saint Lucia in the future. In October 2018 President Trump signed the BUILD Act which will overhaul OPIC, giving it a new lease of life as the US International Development Finance Corporation. The DFC, which will officially launch in October this year, will have double the investment capacity with US$ 60bn on the books.
Pellecchia says OPIC is looking closely at Saint Lucia and the wider Caribbean for viable opportunities. “We will continue to look for ways to expand our engagement with the Caribbean to catalyze private sector investment and create economic opportunities.” In the meantime, she notes that OPIC is sharing the information learned on last month’s trip with other stakeholders in the US government, setting the stage for closer political and economic ties between Saint Lucia and one of its most powerful allies.
