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Politics

'De-banking' poses risks to Caribbean economies

Opening sequence

Opening sequence

Politics

'De-banking' poses risks to Caribbean economies

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COMING UP:'De-banking' poses risks to Caribbean economies

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Transcript

00:00:02
>> The after shock of the 2008 financial crisis still being felt far from Wall Street in the Caribbean. Where tighter controls and aversion to risk have left nations such as Belize essentially cut off from the international banking system. Yeganeh Torbati traveled to Belize and saw first hand the effects of the trend known as de-banking or de-risking.
00:00:25
>> I went to Belize City, I interviewed different Belizean business owners and Belize is really ground zero for this trend. Only two police banks maintain any relationships with US Banks. The businesses that I spoke to, it use to take the moments to clear transactions, to pay their suppliers in the US or abroad and now they really have to set aside weeks,
00:00:47
>> US banks like Bank of America, Citibank and Wells Fargo have been pulling out of the Caribbean all together.>> There's been a greater focus among regulators, among US banks and European banks on getting rid of any business that is seen as even slightly risky. The Caribbean countries because they're small, they don't have much of a manufacturing base.
00:01:06
They depend disproportionally on trade as well. Amd those banking links are used by the worlds poorest people to send funds back and forth. And they often keep entire families out of poverty with their wages. Caribbean officials that we've spoken to say that it really raises the possibility that their economies could really go belly up.
00:01:26
And so that raises real concerns among the World Bank and other international organizations that the global goal of financial inclusions is really being hampered by this trend.