ECCB 2020-2021 Annual Report and Statement of Accounts

GOVERNOR’S FOREWORD

On the governance front, the Bank fortified its framework by introducing a number of new human resource policies to guide staff and meet the standards befitting an institution that strives to be a model . Furthermore, an External Quality Assessment rating validated the institution’s efforts to strengthen its internal audit function. Other areas of progress in respect of enhancing our operations include the development of a banknote-forecasting model to help manage the Central Bank’s currency operations. Despite the deterioration in global financial conditions, prudent management of the institution’s resources contributed to profits for a fifth consecutive year, amounting to $25.2 million for the 2020/2021 financial year. Also noteworthy is the completion of Phase II of the Solar Canopy Project as part of the broader Greening of the ECCB Campus Initiative. The completion of Phase II is a milestone in our programme to achieve carbon neutrality by 2022. Given the region’s vulnerability to climate change risks, the Bank takes seriously its moral obligation to reduce carbon emissions and contribute to climate resilience. Recent spikes in COVID-19 cases in the region and around the world are an admonition against prematurely declaring that the war on COVID-19 is won. The rollout of vaccination programmes in the ECCU offers hope to end the crisis sooner rather than later. Even with this hope of emerging from one crisis, the cataclysmic eruption of La Soufrière Volcano in Saint Vincent and the Grenadines in early April 2021 made the region’s vulnerability to crises glaring, once again. The Bank stands in solidarity with our brothers and sisters in Saint Vincent and the Grenadines as they endure this additional shock. With another Atlantic Hurricane season upon us, the very real threat of cascading crises looms large in the region. Against this backdrop of heightened risks, the ECCB forecasts that GDP growth in the ECCU will range from 1.5 per cent to 2.5 per cent in 2021 – falling short of the target growth rate of 5.0 per cent. The IMF projects strong global economic performance in 2021, with a growth rate of 6.0 per cent. Still, Tourism in the ECCU is not expected to recover to pre-pandemic levels before 2023 or 2024. The focus for the region now must be to prevent permanent damage to our economies, hasten the recovery and build resilience against future (inevitable) shocks. Upon my reappointment as Governor on 1 February 2021, I invited and Team ECCB committed to be: competent yet caring; prudent but proactive; and imaginative and industrious . Guided by our renewed purpose to serve the region in a difficult time, for the financial year 2021/2022, the Bank will launch a new Strategic Plan 2021-2026. The new Plan will be centered around five strategic themes: digital transformation; environmental, social and corporate governance; financial stability; organisational effectiveness and development; and payment systems improvement and financial inclusion. Our programmes and plans for recovery, resilience and transformation are not merely aspirations. The Bank will move to action by pursuing a full slate of activities in the financial year 2021/2022: Financial Stability • Advance work towards the implementation of Basel II/III; • Complete research work on a Regional Standards Setting Body for the Non-Bank Financial Institution (NBFI) Sector of the ECCU; and • Continue to collaborate with partners on the development of a renewable energy infrastructure fund facility.

Digital Transformation • Roll out DCash in the remaining four member countries: Anguilla, the Commonwealth of Dominica, Montserrat and Saint Vincent and the Grenadines; • Explore SupTech and RegTech to improve the efficiency of supervisory and regulatory operations; and • Expand the use of SAS software solution for data management, visualisation and analytics.

Payment Systems Improvement and Financial Inclusion • Prepare a new Payment System and Services Act and Regulations; • Develop a Payment System Reform Strategy; and • Conduct surveys to assess the level of financial inclusion in the region.

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