On Wednesday evening at the Pegasus Hotel three of the Caribbean's respected intellectuals - Sir Alister McIntyre, Owen Arthur and Don Robotham will come together to discuss ideas for the upcoming Summit of the Americas which will see the region's hosting (in Trinidad) United States President Barack Obama and Secretary of State Hillary Clinton.

It will be the first public event of Jamaica's newest think tank, the Roxborough Institute, spearheaded by another fine mind, political scientist and Member of Parliament, Dr Peter Phillips. The institute has chosen a most apposite topic to address. We need a respite from the parochial discussions and obsessions.

Prime Minister Bruce Golding returned to Jamaica on Monday night to tell us that he and his fellow Caricom leaders will be going to Port-of-Spain with a serious agenda of issues for President Obama. It is the best of times and the worst of times for the small states of the Caribbean.

Development agenda

Golding and the other Caribbean leaders' work will, in a way, be much easier than it would be even two years ago. They are now the beneficiaries of what the Marxists would call 'the objective realities' and the dialectics of history. There is no longer any debate as to whether significant reforms are needed in the international financial architecture. No longer any debate on whether there needs to be greater international coordination of economic policies and a return to a development agenda.

No more debate on the need to give strong financial and institutional support to developing countries. Michael Manley, Julius Nyerere and Fidel Castro had to crusade valiantly in the 1970s for a New International Economic Order, but today the dialectics of history and a critical mass of intellectual thought and political activism have made things easier for leaders like Golding and other Caribbean leaders.

The Bretton Woods institutions of the International Monetary Fund and the World Bank have now mainstreamed some things which were subversive and 'communistic' in Michael Manley's days, or just a few years ago. The International Monetary Fund (IMF) issued a major paper earlier this month, The Implications of the Global Financial Crisis for Low-Income Countries, in which it set out in a most sympathetic way the crisis facing least developed countries.

Austerity programmes

In this report, the IMF shows the LDCs swimming against the tide in this global economic crisis, with commodity prices, exports, aid and remittances down, and costs and social tensions up. While in the past, by way of dreaded IMF conditionalities, developing countries were forced to adopt austerity programmes to 'balance the books', now the IMF itself is speaking strongly about social safety nets.

"There may be scope to scale up existing spending programme in targeted ways," the IMF counsels in its report.

Continues the IMF: "Countries can implement public works programmes and/or provide supplements through existing programmes - labour-intensive infrastructure projects can be effective in providing income support to the poor. Additional resources can be channelled to targeted programmes such as targeted food distribution to school-meal programmes." That's the IMF speaking.

There is more: "Expanding conditional cash transfer programmes that link cash transfers or subsidies to receipt of health care or education can be an effective method of addressing potential losses in human capital." What? The IMF talking about "subsidies" to the poor? Yes, that's the sea of change that has taken place in development thinking, the result of both "objective realities" and a hard-fought struggle against the intellectual hegemony of conservative and neoliberal economic thought. Bravo to all those gallant progressive economists and social scientists who waged an intellectually fierce and impressive assault on right-wing thinking.

The World Bank is also resolute in speaking up for global reforms and protecting and advancing the gains of the poor. In a widely quoted paper issued two weeks ago, Swimming Against the Tide: How Developing Countries are Coping with the Global Crisis, the World Bank pleads the cause of the developing world: "Many institutions that have provided financial intermediation for developing country clients have virtually disappeared. Developing countries are likely to face higher spreads and lower capital flows than over the past seven-eight years, leading to weaker investment and slower growth in the future."

Now hear the World Bank: "There is, therefore, a strong need to expand assistance to LICS (low-income countries) to protect critical expenditures and prevent an erosion of progress in reducing poverty. Attention must be directed to protecting the poor through targeted social spending including expanded s safety nets." Is this really the World Bank and not some socialist organisation speaking?

Protecting infrastructure

There is more: "With the expectation of falling revenues and a scarcity of affordably priced capital, protecting core social and infrastructure spending will become more difficult." In previous years, the World Bank would use that argument to counsel fiscal conservatism and cutbacks of social spending, spreading the balanced-budget-at-all-cost dogma (deficit financing was then evil).

Now the World Bank, chastened by experience, is singing a different tune: "With the likely demand for social safety nets, particularly as unemployment rises, the cost of existing social support can be expected to increase. But the long-term cost of neglecting social support can be significant, suggesting a critical need to protect spending."

If only some of our local commentators and private sector spokespersons were not so averse to reading serious books and hefty economic reports, perhaps they would spare us the trite commentary which still undervalues social spending because 'tough decisions' have to be taken.

When Golding and his Caricom colleagues go to Trinidad to speak with President Obama and his team, they will already be at an advantage because not only will they be meeting with liberal Democrats but at a time when neoliberal economic thought has been discredited, bankers are despised for their greed and recklessness, and the 'magic of the market' is a phrase used in derision rather than as incantation.

The World Bank Group has already announced that it is tripling its lending this fiscal year, to reach possibly $100 billion. The IMF itself is calling for a beefing up of its $350 billion in financial reserves (counting the $150 billion from the Japanese). The World Bank has already proposed an umbrella Vulnerability Fund to which developed countries would dedicate 0.7 per cent of their planned economic stimulus. (I hope this does better than the decades-long pledge of the 0.7 per cent of GDP aid to developing countries).

According to the Institute for International Finance, net private capital flows to emerging markets declined by 50 per cent last year, reaching $467 billion. This year it will sink to just $165 billion. Some 104 out of 129 developing countries will not have enough surplus to cover their private debt coming due. It's that stark - and the multilaterals and the most powerful global institutions and governments in the world know it.

Emerging economies

The IMF just last week issued a report titled Group of Twenty: Global Economic Policies and Prospects, which contains its analysis of the group's meeting last weekend. In that paper the IMF notes that "the decline in capital flows to emerging economies will be protracted". It's no longer unfashionable not to be doing well and not able to attract financing, Standards and Poor's downgrading of Jamaica notwithstanding.

Caribbean leaders must be aware when they meet with their counterparts from the Americas that their interests are likely to be overshadowed unless they are clear in their strategic positioning. Gone are the days when we could talk blithely about 'Third World solidarity'. We have less in common with Third World countries like Brazil, Mexico and Argentina (not to mention China and India) than we have with Ireland and the transition economies. We have to reconfigure alliances and strategic partnerships. It's not the old days. China was largely responsible for the stalling of the Doha Round, not just Europe and the United States (US).

The Caribbean needs to understand that it has totally lost its strategic significance to Washington, plain and simple. And we are even less important now that Bush is out of power. At least with Bush's paranoia over The War on Terror, he was concerned about our producing or facilitating terrorists. Obama has no such focus. With the Cold War over, there are no superpowers to play off anymore.

Our trade with the US is significant to us but not even on the radar in terms of the US. Latin America is still important to Washington, not the Caribbean. In 2007 alone the United States received about $120 billion in capital flows from the Latin American region. Total US-Latin America trade is $555 billion and from 1996 to 2006 total US merchandise trade with the region grew 139 per cent, compared with 96 per cent for Asia and 95 per cent for the European Union.

Global opinion

When you read Obama's New Partnership for the Americas document there is almost no mention of the Caribbean, except for Cuba and Haiti. So don't be fooled into thinking that we matter to Washington. What strengthens our case as small, open island economies is that global opinion has swung on the side of development and interventionist government and, as a recent Newsweek cover story blared 'We are all socialists now'. The G-20 is more minded to provide assistance to the world and the rise of Obama resuscitated liberal internationalism, diplomacy and a greater focus on the global development agenda.

Bruce Golding, who has a very sharp mind on international affairs and takes a progressive stance, is up to the intellectual challenge of Port--of-Spain.

We will be depending on him to provide solid leadership to Caricom as he and his colleagues take the Caribbean's case not only to Obama but to the Latin American bigwigs.

Ian Boyne is a veteran journalist who may be reached at ianboyne1@yahoo.com or columns@gleanerjm.com