1.0 What is the Eight Point Programme?
The Eight Point Programme is a comprehensive plan of action to address the protracted negative impact of the current global economic and financial crisis on the economies of the Eastern Caribbean Currency Union.
The following are the elements of the eight point programme:
1. Suitably adapted Financial Programmes for each country
2. Fiscal Reform Programmes
3. Debt Management Programmes
4. Public Sector Investment Programmes
5. Social Safety Net Programmes
6. Financial Safety Net Programmes
7. Amalgamation of the Indigenous Commercial Banks
8. Rationalisation, Development and Regulation of the Insurance Sector
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2.0 What are the specifics of the Eight Point Programme?
2.1 Financial Programme
The Financial Programmes give a framework for assessing the economy through examination of the macro economic accounts. They address the imbalances of the economy by bringing into alignment, in a consistent manner, the four basic macroeconomic accounts namely:
1. Balance of Payments (External Sector)
2. National Accounts (Real Sector)
3. Fiscal Accounts (Public Sector)
4. Monetary Accounts (Financial Sector)
The main objective of the exercise is to identify the financing gaps of the central government and propose a set of policy measures to close the gaps and address other structural issues.
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2.2 Fiscal Reform Programmes
The Fiscal Reform Programmes seek to develop efficient revenue and expenditure systems in the Currency Union. The programmes for improving the revenue system are based on a recommendation of the Commission on Tax and Tax Administration Reform. Countries are in the process of implementing the recommendations of the Tax Commission. Efforts at improving the expenditure systems are ongoing with the current work of the Commission on Pension and Pension Administration Reform. The Fiscal Reform Programmes will now focus on other expenditure issues, and in particular, expenditure on social programmes in relation to education and health, and on the Public Sector Investment Programme. They also involve addressing issues relating to the management of governments’ cash flows, debt servicing and the wage bill.
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2.3 Debt Management
The Debt Management Programmes involve the development of a debt strategy aimed at aligning the countries debt to achieve the debt target of 60 percent of GDP by 2020 which was established by the Monetary Council. In this regard, the ECCB has been the recipient of a grant from CIDA to treat with the debt issue and has actively engaged the IMF and the World Bank in establishing benchmarks and strengthening capacity in member countries. In particular, the debt management programme would facilitate a structured approach to effective debt management, so as to realign the debt to the optimal profiles and transform our highly indebted countries to a level of debt sustainability, 2.4 Public Sector Investment Programme Under this programme, the countries would develop their Public Sector Investment Programmes (PSIPs), which would address:
(a) Quick disbursing projects which will put people to work and stimulate economic activity to restore growth; and (b) The provision of critical infrastructure for medium to long term development.
The Public Sector Investment Programme (PSIP) is meant to be the vehicle through which any short to medium term fiscal stimulus will be provided within the ECCU.
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2.5 Social Safety Net
Given the fallout from the crisis, the social protection systems are under pressure. There is therefore an urgent need for review of the Social Safety Net Programmes, in order to protect the poor and vulnerable as the international crisis deepens. The objective is not only to redress poverty, but also the creation of a path for advancement towards self sufficiency for those persons in poverty.

2.6 Financial Sector Safety Net
The current state of the financial system requires immediate liquidity support. Under this programme, the intention is to approach friendly countries to raise funds for the restructuring and recapitalisation of the banking and insurance sectors and strengthening the regulatory and supervisory regimes.

2.7 Amalgamation of the Indigenous Commercial Banks
The amalgamation of indigenous commercial banks, as the name suggests, would create a strong financial entity which would be a crucial player in the financial and economic development of the countries of the Currency Union. Amalgamation would also allow the indigenous banking sector to take advantageof economies of scale and scope, efficiencies in operations and increasing opportunities for more diverse state-of-the-art banking services.

2.8 Rationalisation of the Insurance Sector
The current financial crisis has revealed the fragility of the insurance sector which now poses a threat to the financial system. In addition, the present regulatory framework has resulted in financially weak companies and lax regulation and supervision. The objective is to reduce the number of insurance companies operating in the region and to strengthen the regulatory framework.
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3.0 What is a Financial Programme?
A Financial Programme is a consistent framework for assessing all the macro economic accounts. It consists of a baseline scenario based on current policies and an active scenario based on adjustments required to bring the accounts into alignment. The Financial Programme therefore addresses the imbalances in the economy by bringing into alignment, in a consistent manner, the four basic macroeconomic accounts namely:
1. Balance of Payments (External Sector)
2. National Accounts (Real Sector)
3. Fiscal Accounts (Public Sector)
4. Monetary Accounts (Financial Sector)
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4.0 What is a Financial Safety Net?
The Financial Safety Net is a liquidity support programme to be used for the restructuring and recapitalisation of the banking and insurance sectors and for strengthening the regulatory and supervisory regimes.

5.0 How was the Eight Point Programme derived?
The Eight Point Programme was derived following an assessment of the international and regional developments and the identification of the threats to the Currency Union. The major threats to which the member countries of the Currency Union need to respond are:
1. The current global financial and economic crisis;
2. The looming threat of the crack down on tax havens and offshore financial centers by the OECD countries;
3. The crisis created by the run on the Bank of Antigua which has exposed the fragility of the indigenous banking sector;
4. The difficulties of CLICO and British American Insurance companies which have highlighted the highly fragmented, dysfunctional and largely unregulated state of this sector; and
5. The secular decline in the rate of growth of the economies of the Currency Union which renders them incapable of reducing unemployment and poverty and maintaining and improving their Human Development Indices.
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6.0 Who developed the Eight Point Programme?
The Eight Point Programme was developed by the Central Bank and the member countries of the Currency Union, and was approved by the Heads of Government and the Monetary Council of the ECCB.
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7.0 Are the elements of the Eight Point Programme listed in order of priority?
The eight point programme is a comprehensive package and all components are important for the success of the programme. However, the first five elements are at a more advanced stage of development.

8.0 Why an Eight Point Programme?
These are the initiatives considered necessary to respond to the threats that are confronting the Currency Union and in particular:
1. The current global financial and economic crisis;
2. The crisis created by the run on the Bank of Antigua;
3. The difficulties being experienced by CLICO and British American Insurance companies; and
4. The secular decline in the rate of growth of the economies of the Currency Union which renders them incapable of reducing unemployment and poverty and maintaining and improving their Human Development Indices.
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9.0 How is the Eight Point Programme going to be implemented?
The strategic responses to the threats posed by the financial crisis require actions at both the Currency Union and national levels. The programmes at the national level would be implemented by the member governments. Those at the Currency Union Level would be implemented by the Central Bank or the OECS Secretariat in collaboration with member governments.

10.0 What is the time frame for the implementation of the Eight Point Programme?
Work is ongoing on all the components of the eight point programme. In particular, the technical officers of the member countries would meet to finalise the Financial Programmes, Fiscal Reform Programmes, Debt Management Programmes, Public Sector Investment Programmes and Social Safety Net Programmes in a ‘Boot Camp’ scheduled for September 2009 with implementation programmed for October, 2009. The other programmes are at various stages in the consultative process.
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11.0 What are the benefits of the eight point programme?
The main benefit of the programme is its potential to halt the decline in economic activity and to lay the foundation for growth and transformation of the economies. The programme is referred to as the stabilization and growth programme. It would stabilize the economies during this period of recession,
provide a stimulus for economic growth and would be the basis for transforming the economies.

12.0 How will the Eight Point Programme help the poor in the ECCU?
The programme would assist the poor through the impact on stabilization and growth of the economies and hence on income and employment. The first three components - Financial Programme, Fiscal Reform Programme and Debt Management Programme - of the eight point programme are aimed at first stabilizing the economies by addressing the deficiencies that have placed the region under severe stress. The PSIP and Social Safety Net Programme are intended to stimulate the economy.
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13.0 Who would finance the Eight Point Programme?
Following the development of credible Financial Programmes, Fiscal Reform Programmes, Debt Management Programmes, PSIP and the Social Safety Net Programmes, the intention is to approach donor agencies and development partners for financing the programmes and for technical support.

14.0 Which countries are affected by the Eight Point Programme?
All countries of the Currency Union are affected by the Eight Point Programme.
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15.0 Who monitors and evaluates the Eight Point Programme?
Through the joint meetings of the Heads of Government and the Monetary Council, all the member governments of the Currency Union individually and collectively will monitor the Eight Point Programme. In particular, the development of the Financial Programmes would include targets which would be monitored over the medium term.

16.0 The current economic situation is not of our doing, why do we have to adjust?
The adjustments are needed because of the adverse impact of the current financial crisis on the economies of the Currency Union and on the lives of the population. In particular, real GDP in the ECCU is projected to decline in 2009 and 2010. The projected decline in tourism and construction is over 14 per cent in 2009 and a little less in 2010. Governments' current revenue is projected to fall by approximately 12.9 per cent in 2009. The economies need to adjust quickly to cushion the impact of the global crisis.
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17.0 How can I assist in the successful implementation of the Eight Point Programme?
Individuals could assist in the implementation of the programmes by personal adjustments particularly related to the efficiency of expenditure, stimulating the economies through investments, and by providing a supportive role to the programme through advocacy.

18.0 What is the role of the ECCB and the OECS Secretariat in the Eight Point Programme?
The ECCB and the OECS Secretariat coordinate and provide technical support for the implementation of the Eight Point Programme.
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19.0 How does the Eight Point Programme relate to the economic union?
The threats posed by the financial crisis require responses at both the Currency Union and national levels. Therefore, the Heads of Government and the Ministers of Finance have met at two special meetings to discuss the response to the financial crisis. The Monetary Council has also met on several occasions.This approach, strengthens the movement to an Economic Union by the collaborative decision-making, and has the advantage of increasing capacity at the Currency Union level, to negotiate with third parties in both the public and private sectors. In addition, the eight point programme involves the amalgamation of the indigenous commercial banks and the rationalization of the insurance sector thereby supporting the creation of a single economic and financial space.
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20.0 Is there a time frame for the amalgamation of the indigenous commercial banks?
This is a process which involves consultations among stakeholders and hence an exact time cannot be given at this point.

21.0 What provisions are there for the sensitization of the OECS public to the Eight Point Programme?
The Heads of Government and the Ministers of Finance have been communicating to the public through press conferences. This activity is one of the mechanisms for sensitizing the public to the global developments and the strategic response.
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