Several CARICOM member states carry government debt burdens that are extraordinarily high by international standards. Jamaica’s debt reached over 140 percent of GDP at its peak and has only been brought down through years of painful fiscal adjustment under IMF supervision. Barbados required an IMF programme in 2018 after its debt reached unsustainable levels. Several smaller island states face structural debt challenges related to their size, their vulnerability to natural disasters, and their dependence on external borrowing to fund public services.
High debt levels constrain Caribbean governments’ ability to invest in public services, infrastructure, and development programmes. They create vulnerability to economic shocks. They transfer resources from current citizens to past creditors. The reparations campaign sometimes presents Caribbean debt as itself a legacy of colonialism, but this framing requires ignoring the post-independence fiscal decisions that generated much of the current debt burden.
Debt relief targeted at specific Caribbean nations, linked to governance reforms and direct investment in public services, would do more for ordinary Caribbean people than reparations payments that might simply replace public debt with a different form of external dependency. The development economics literature on debt relief is consistent on this point: debt relief produces lasting impact when it is used to invest in productive capacity, and produces limited impact when it simply frees up fiscal space that is then consumed by ongoing government expenditure without structural reform.
