The Organization of American States (OAS) on the Promotion and Protection of Freedom of Religion or Belief

The OAS General Secretariat Declaration on the Promotion and Protection of Freedom of Religion or Belief

Freedom of religion or belief is closely linked to the principle of freedom and human integrity in all its dimensions, as well as to the principle of plurality and diversity, taking into account the wealth of religious and spiritual expressions that are part of our territories

The fundamental right to freedom of religion or belief is part of the origins of human rights treaties and conventions. It is related to the freedom to identify with a particular belief, as well as to change religion, and even not to have any particular religious affiliation.  Freedom of religion or belief is closely linked to the principle of freedom and human integrity in all its dimensions, as well as to the principle of plurality and diversity, taking into account the wealth of religious and spiritual expressions that are part of our territories.

For these reasons, guaranteeing freedom of religion or belief continues to be a fundamental responsibility of States.  This translates into legal frameworks and public policies that recognize the plurality of religious, belief and spiritual voices, that enable treatments and paths of democratic dialogue, that account for the richness and diversity of the world of beliefs, and with it, that prevent the privilege or predominance of particular and individual expressions over the rest.

The resolution "Strengthening protection and promotion of the right to freedom of conscience and religion or belief," in section XXV of the Resolution for the Promotion and Protection of Human Rights of 2022, approved during the 52nd OAS General Assembly, highlights the importance of these issues.  However, this document also brings to light a set of pressing problems in our region: the persecution and discrimination of religious and belief groups (also called “members of religious minority groups”), as well as the presence of acts of intolerance and violence in the name of religion.

For all this, it is essential to understand that religious freedom or belief as a human right is, in turn, linked to the defense of the rights of all individuals and groups, in all areas.  Discussing freedom of religion or belief not only implies creating mechanisms to recognize the existence of particular groups of believers, but also represents a right that is intrinsically related to respect and promotion of other identities, other expressions, other freedoms, other rights.

Hence, from the General Secretariat,

1. We urge member states to prioritize the development of guarantees -both legal and political- that account for the importance of religious freedom and belief as a principle of recognition, visibility and promotion of religious plurality and belief as a basis of democracy.

2. We call for States to promote spaces for meeting and inclusive dialogue that allow the plurality of religious expressions and beliefs to be known, with the aim of preventing the spread of discriminatory stereotypes and prejudiced actions against members of religious minority groups.

3. We request the creation of spaces for dialogue and exchange -among States, specialists, religious and belief communities, spiritual practitioners, civil society and other multilateral instances- for the development of specific standards for the protection of religious minority groups, for the prevention of discrimination based on religion or belief, and instrumentalization of religious discourse for the violation of other rights and freedoms.

4. We invite States, civil society organizations, faith-based organizations, and religious and spiritual groups, to build spaces for meeting and mutual recognition -both nationally and multilaterally- that allow accounting for the multiplicity and richness of interactions between the religions and spiritualities present in our societies, from their vast and unfathomable wealth of expressions, manifestations and positions.

February 27, 2023

Source 

Notes From the IMF Working Paper on the Latin America and the Caribbean (LAC) Region Experience with Central Bank Digital Currencies (CBDCs)

The LAC region has been in the forefront of Central Bank Digital Currency (CBDC) adoption, with formal introduction in The Bahamas, the ECCU, and Jamaica, in addition to a pilot project in Uruguay 

Crypto Assets and CBDCs in Latin America and the Caribbean: Opportunities and Risks 

Prepared by M. Appendino, O. Bespalova, R. Bhattacharya, JF. Clevy, N. Geng, T. Komatsuzaki, J. Lesniak, W. Lian, S. Marcelino, M. Villafuerte, Y. Yakhshilikov 

Authorized for distribution by Patricia Alosnso-Gamo February 2023 

The text below provides a summary of the Latin America and the Caribbean countries experiences with CBDCs. 

The Bahamas 

The Bahamas’ Central Bank Digital Currency (CBDC), the “Sand Dollar”, was officially launched on October 20, 2020, and was the first state-backed digital currency in the world.  The main objectives were to boost financial inclusion for communities in remote islands and to strengthen the resilience of the payments system to natural disasters and pandemics.  An important additional consideration for launching the Sand Dollar has been the high cost for government agencies to make cash-based payments to citizens who lack bank accounts.  There are plans to integrate government agencies in the Sand Dollar network to support digital government payments to individuals to lower this cost.  Issuance to date of Sand Dollars has been limited and use of the platform by licensed financial institutions appears muted.  As of end-January 2022, CBDC in circulation was less than 0.1 percent of currency in circulation and of broad money. 

The nationwide rollout that started in 2020 involved two phases.  In the first phase, private-sector players such as banks and credit unions will ready their systems with Know-Your-Customer (KYC) and other compliance checks across low-value, personal and enterprise wallets.  The Central Bank of Bahamas (CBOB) has an in-house know your customers (KYC) or e-KYC solution, which all the institutions can use and hence do not need to incur extra costs.  This is used to establish which of three wallet levels a user can have.  A basic wallet only requires an email address or phone number but no photo ID.  However, it is restricted to a $500 balance and $1500 in monthly transactions.  The second level requires a government photo ID, and the limits are $5,000 for balances and $10,000 transactions.  The third level requires businesses to provide their license and tax filings, with a holding limit of $8,000 to $1,000,000 with unlimited transactions.  The Sand Dollar is linked to the existing financial system through a dynamic link, where excess balances in wallets are deposited in a user’s accounts at financial institutions.  The Sand Dollar's second phase focuses on preparing essential infrastructure services in the government and private sectors, such as utility companies Phase 2 has been delayed by the new government and it is unclear when this phase will start. 

Despite its limited use to date, the Sand Dollar is still assessed to pose risks to financial intermediation, integrity, and cybersecurity.  The CBDC could substitute for deposits in commercial banks, with implications for bank funding, profitability, and financial intermediation.  Moreover, a digital currency involves costly investments in new technologies, infrastructure, and external expertise.  It can also expose a central bank to new risks and introduce new challenges for ensuring financial integrity, while cyberattacks or technological glitches can impact the central bank’s reputation.  Its architecture has some features to mitigate risks: 

• Financial stability. To limit disintermediation risks and substitutability with bank deposits, Sand Dollar holdings do not earn interest, and a ceiling is in place limiting the amount users are able to hold in their wallets.  Moreover, level 2 and 3 wallets are linked to accounts at financial institutions.  To mitigate potential runs in case of stress, a circuit breaker has been embedded in the system to prevent massive flows.  However, depending on the deposit structure of banks, some banks could still be vulnerable to financial disintermediation and bank runs, and deposits could quickly move from a financial institution to the CBDC. 

• Financial integrity. The Central Bank Law and other legislation were amended to reflect the new digital legal tender.  The central bank also plans to promote an e-KYC register to maintain identification of individuals who do not maintain such information with banks or other financial intermediaries.  Sand Dollar-integrated wallets are enabled with multi-factor authentication features.  All mobile devices are required to support a passcode or a biometrics-based sign-in to access the app and complete transactions.  The wallets cannot be used outside the country or for FX operations on their own, which reduces their susceptibility to illicit international flows. 

• Cybersecurity. The central bank has a unit tasked to monitor cyber risk and is upgrading its IT systems and monitoring systems.  All Sand Dollar authorized financial institutions (AFIs) are required to complete robust and intensive cybersecurity assessments by an independent international firm before receiving approval to integrate the Sand Dollar platform with their custom applications. 

The central bank is working to ensure the offline usability of the Sand Dollar, so that citizens can still transact even when there is no electricity or cell phone network: the authorities consider off-line functionality vitally important.  However, the authorities have encountered unanticipated difficulties in achieving it.  During the pilot projects on two key islands in December 2019 and February 2020 it was revealed that the planned solution of local off-line networks – built on introducing local redundancies to the main telecommunication system – did not fully achieve the policy goal.  The telecommunication masts required in the solution are vulnerable to the same weather conditions as the main telecommunication system.  Also, the geographical reach of the local networks is limited, which makes it difficult to make payments between islands.  During the second phase of the Sand Dollar project the CBOB is seeking alternative solutions together with its main contractor. 

The Bahamas has stated that the use of the Sand Dollar is exclusively for domestic purposes and that cross-border payments must take place through commercial banks in traditional non-CBDC Bahamian dollars.  Foreigners can own and pay with Sand Dollars when visiting The Bahamas by registering for an account with low holding size and monthly transactions’ limits, but cannot transfer or pay with them abroad.  However, Mastercard and Island Pay launched Sand Dollar prepaid cards in February 2021 that allow for instant conversion of digital currency to traditional Bahamian dollars, and to pay for goods and services Mastercard is accepted on the islands and also around the world.  During the second phase of the project, the CBOB is planning to further explore cross-border uses. 

ECCU 

The Eastern Caribbean Currency Union (ECCU)’s Central Bank Digital Currency (CBDC), DCash (DXCD), is the first digital currency introduced by a currency union.  As a digital form of the EC dollar, DCash is a legal tender of the Eastern Caribbean Central Bank (ECCB) and is developed to serve as a key instrument for facilitating the digital transformation of the ECCU.  The idea was initiated by Bitt, a private company, around 2017, which the ECCB incorporated in its 2017-21 transformation agenda.  Following the development and testing phase in March 2019- February 2020 - and after a delay due to the pandemic, DCash was introduced on a pilot basis in March 2021, initially in four (out of 8) ECCU countries (Antigua and Barbuda, Grenada, St. Kits and Nevis, and St. Lucia).  The DCash pilot project was extended to St. Vincent and the Grenadines in August 2021, to Dominica and Montserrat in December 2021, and to Anguilla in June 2022.  The ECCB plans to continue the pilot program until June 2023 to allow all member countries at least one year experience with DCash before drawing lessons from the pilot. 

DCash has been launched with a view to improving payment efficiency, financial inclusion, and competitiveness and resilience.  The initiative was prompted by the high cost of payments-related banking services and slow adoption of new technologies by the private sector.  Cash is expensive to issue and handle in the ECCU, including transportation, storage, and security for both the central bank and the private sector, with many islands that are widely dispersed.  Mobile payment is under-developed in the ECCU, despite a high penetration of smartphones.  Credit cards and debit cards charge high transaction fees (currently around 3.5 percent).  Small firms in the informal sector bear the cost of inefficient payment disproportionately, and many households in these island economies are still under-banked (as the number of credit and debit cards per person is much lower than in other regions with similar development level).  Financial friction implied by high payment costs hinder economic growth and make the system more vulnerable to shocks.  DCash, which charges no fees for transactions in the pilot stage, can lower the cost of payments and decrease the use of paper cash as well as of cheques, which account for around 80 percent of all transactions.  The ECCB has a goal of cutting it by half, to reduce the costs of cash usage. 

The DCash has several distinct design features.  It is based on private blockchain technology, with all system services, except the minting system, stored at Google Cloud.  The ECCB has the sole authority to issue and redeem the digital currency and will be able to fully control its supply.  It has a “two-tier system” to fully utilize the comparative advantage of (i) the private sector to interact with customers and carry out the relevant AML/CFT requirements, including the necessary customer due diligence measures; and (ii) the central bank to provide trust and manage the DXCD scheme in line with its payment system policies.  The ECCB can observe each transaction data (but anonymously) and the outstanding stock of the DXCD in each digital wallet.  The ECCB does not see detailed information about the DXCD transactions (e.g., the identity/name of payers and payees and the purpose of transaction).  Financial institutions can fully observe the transaction purpose (e.g., the goods or services payers bought from payees), if either payers or payees are their own customers.  They are responsible for maintaining their own clients’ database. 

To minimize financial stability risks, the digital currency is designed as a small value retail instrument, with no interest accrued and no use for foreign exchange transactions.  The size of its holding and transaction values per wallet is limited and digital wallets bear no interests, to avoid competition with savings accounts of financial institutions.  The transfer between digital wallets is only allowed to take place within the ECCU, with no use for foreign exchange transactions.  Financial institutions are allowed to control the amounts of digital currency depositors can exchange for deposit accounts, which would help their liquidity management.

To mitigate cybersecurity risks, the pilot is limited in the scope of system integration.  Most importantly, the DCash system is not planned to be linked to the ECCB's core payment systems (such as the RTGS), banks' operating systems, and the Automated Clearing House.  This is intentional and a prudent approach given (not fully known) risks entailed in the digital currency system.  This, however, means that after the pilot, another round of testing will be needed to assess vulnerabilities and risks after connecting the DCash system to other payment and operating systems at the ECCB and financial institutions. 

While about three-quarters of financial institutions have participated so far in the pilot, the adoption of DCash so far has been slow, albeit uneven across countries.  According to the ECCB, 22 financial institutions, 11 agencies, 292 merchants, and 4,039 end-users in ECCU countries have participated in the pilot program as of end-April 2022.  Meanwhile, despite rolling out the DCash pilot only in August 2021, St. Vincent and the Grenadines has become the front-runner in the uptake of DCash, with the participation of 5 financial institutions, two agencies, and about one thousand customers so far, owing to the on-boarding of the largest bank which has readily available resources for launching DCash in the context of its own digitalization efforts.  The overall protracted uptake is largely due to the lack of marketing and public awareness as well as resource constraints faced by financial institutions and merchants in the context of increased burden posed by the pandemic and acquisitions and mergers following the exit of several foreign banks from some ECCU countries.  In addition, DCash is still relatively unknown to the public, which underscores the need for public education campaigns to raise awareness and informing the various stakeholders about the potential benefits of a CBDC.  However, the ECCB expects DCash diffusion to accelerate as it shifts the focus from onboarding countries to marketing and public education campaigns and more merchants and large banks participate in the pilot.  The ECCB plans to draw lessons from the pilot once concluded.  Nevertheless, no decision has been taken yet on if to continue with the issuance at the end of the pilot program. 

In addition, the uptake was interrupted by a two-month outage in early 2022.  This was further exacerbated by a lack of timely communication on the extent and cause of service disruption and timelines for recovery.  DCash went offline between mid-January to mid-March 2022 on account of a problem with the system’s operational management processes of renewing/rotating digital certificates.  This IT operational function falls under the responsibilities of the technology vendor.  According to the ECCB, the outage has disrupted only new transactions and on-boarding of new users, leaving the Distributed Ledger Technology (DLT) and existing data/transactions intact.  All balances under the pilot program are guaranteed by the ECCB. 

The Pilot project provides opportunities to examine risks and assess policy gaps.  Ample excess liquidity in the system and the design of DCash as a non-interest retail instrument with holding limits help mitigate possible financial disintermediation risk.  However, the effects of the DXCD on the choice of payment instruments and financial institutions’ funding are uncertain, especially under stress, and this calls for the ECCB and national supervisors to closely analyze liquidity and funding conditions of financial institutions, including through liquidity stress testing.  Additionally, the ECCB could be exposed to operational and financial risks from malfunctioning of the digital applications, platforms, or infrastructure, due to cyberattacks.  The identification of cybersecurity threats and the exploration of risk mitigation measures are important pre-requisites to the DXCD.  The data and privacy governance frameworks need to be established to ensure that sensitive financial or personal data is protected. 

The DCash experience so far provides some useful lessons for other countries who are considering CBDCs.  CBDCs have the potential to increase economic efficiency and foster financial inclusion, but sufficient efforts and resources are needed to raise public awareness and facilitate communication with end-users to boost confidence and uptake.  Implementing safeguard measures will help contain various risks to which CBDCs could expose central banks and the financial system, including those related to financial intermediation, financial integrity, and cybersecurity.  The DCash outage experience underscores the need to enhance central banks’ operational resilience and business continuity plans, including through incident response planning and ensuring adequacy of skilled resources.  It also stresses the  importance of clear division of operational, oversight, and risk management responsibilities between central banks and technology providers/operators, and establishing appropriate project management governance arrangements.  This is important as failures in CBDC implementation can undermine the credibility of central banks.  Moreover, greater efforts in exploring business cases and incentives for the private sector would help promote adoption. 

Jamaica 

The Jamaican government announced the introduction of a CBDC in March 2021, appointing a technology provider (eCurrency Mint) immediately thereafter and implementing a limited and successful pilot program throughout 2021 that involved four merchants and the National Commercial Bank as a wallet provider.  The Bank of Jamaica (BoJ) announced in December 2021 that it will roll out its CBDC across the country in 2022.  Its roll-out will include two extra wallet providers and the testing of transactions between customers of various participating wallet providers to verify interoperability.  As an important step towards the formal launch of the currency, the Jamaican Parliament passed in June 2022 amendments to the Bank of Jamaica Act and subsequently BoJ (Amendment) Act 2022 (Act 5 of 2022) was duly assented by the Governor General to accommodate the Bank of Jamaica as the sole issuer of CBDC and recognize its CDBC as legal tender.  The CBDC is aimed for domestic use and the BoJ projects to replace some 5 percent of Jamaican dollars’ currency in circulation with the new digital currency each year. 

The main objective behind the launch of a CBDC has been financial inclusion through a digital currency with no user fees or transaction costs.  In addition to financial inclusion, the Bank of Jamaica (BOJ) expects the CBDC to (i) provide additional means of efficient and secure non-cash payment; (ii) increase efficiencies for banks as it relates to the costs for handling and distributing cash; (iii) reduce costs in the currency management process of the BOJ; (iv) provide a socially optimal mix of retail payment instruments; and (v) facilitate interoperability between existing electronic retail payment systems. 

In terms of technical design, it is worth noting that the Jamaican CBDC does not use distributed ledger technology - but instead an existing centralized payment system (the central bank’s Real Time Gross Settlement System (RTGS), JamClear) to avoid having to intervene manually to move from eCurrency’s system into the settlement system.  CBDC will be issued to banks and to the payment services providers who will distribute it to their customers, clients, merchants and consumers through either an E-money wallet, card networks, or other digital options.  To get the CBDC wallet the customers will need to contact a wallet provider of their choice and, if they do not have a bank account use the tax registration number and a government-issued photo ID.  The analysis of the customers signing-up for the CBDC will allow the BOJ to assess its contribution to expanding financial inclusion. 

The authorities recognize that the CBDC has to provide right balance between the AML/CFT regulations and the privacy considerations.  To protect privacy, the CBDC solution support the protection of personal identity through builtin solutions such as encryption techniques, digital signatures, and multi-factor authentication mechanisms.  To combat AML/CFT, the CBDC will allow for tracking of all payments by financial institutions and by the relevant authorities under the Proceeds of Crime Act (POCA) when required.  Wallet Providers are either regulated or authorized by the BoJ and, therefore, the BoJ is the Competent Authority under POCA for these entities and moreover the authorities believe that the Wallet Providers already have in place effective risk-based AML/CFT frameworks. 

To enhance governance, and limit potential reputational risks, an internal BOJ oversight committee was established to provide oversight over the CBDC project’s progress and manage any financial, and nonfinancial risks impacting the BOJ.  The committee includes the supervisory, audit, IT, and financial functions of the central bank.  In addition, in July 2021 the IMF provided technical assistance to the BoJ on central bank risk management, fintech and security which included risk considerations related to the CBDC and its operation.

Uruguay 

Uruguay completed a pilot with e-Peso from November 2017 to April 2018.  The Central bank used a simple technology: token-based and relying on a state-owned cellphone company.  The e-Peso was linked to a phone number without DLT, the end-users did not require internet connection (just a mobile phone line), and the settlement was instantaneous.  There were no costs to either the Central Bank of Uruguay or to the end-users.  The e-Peso could be used for payments in registered stores and for peer-to-peer transfers between registered users.  Transactions were anonymous but traceable with the users’ wallets.  The users’ wallets were encrypted at the Global E-note Manager (GEM) and the e-Pesos were secured at GEM even if users lost their phones or the password of a digital wallet.  The unique and traceable digital bills prevented double-spending and falsification. 

The total issuance of e-Pesos was limited to 20 million pesos (about US$670,000) and the wallet size to 30,000 pesos for individuals (about US$1,000) and 200,000 pesos for registered businesses.  Limits on e-wallets’ size made the ePeso similar to cash and reduced its competition to other means of payments or bank deposits.  Transfers between peers with e-Pesos were widespread throughout the pilot period.  The number of operations rose with the learning process of users.  The pilot was limited to 6 months and the e-Peso bills were subsequently destroyed. 

The pilot was followed by an evaluation process and drew some lessons towards a potential future introduction of a CBDC including the importance of the central bank’s reputation and security features, the merits and feasibility of simple technological solutions, and the potential complementarity of CBDCs with other means of payment (see Sarmiento, 2022).  The new central bank authorities delayed the move to a second stage of a CBDC project to focus on the rollout of the fast payments system. 

Several other countries in the region are conducting studies into CBDCs, at different stages of development including with technical assistance from the Fund.  In what follows, short summaries are presented of the status of that work by October 2022. 

Argentina 

In February 2021, the Central Bank (Banco Central de la República Argentina, BCRA) formally proposed to President Fernandez to consider the introduction of a digital peso.   However, according to Alfonso et al. (2022) the BCRA is not prioritizing the issuance of a CBDC - though it would continue researching it.  To improve the speed of and access to payments, the BCRA relies on the initiative Transferencias 3.0. 

Brazil 

The Central Bank of Brazil (BCB) decided to explore the possibility of introducing the Digital Real, a CBDC, by creating an internal working group in August 2020 that included all areas of the BCB.  This project is the next step of a comprehensive set of reforms that started more than a decade ago aiming at leveling the field for fostering new business models and other innovations in the financial services industry based on technological advances, enhancing the efficiency of the retail payment system, and eventually increasing the efficiency in cross-border transactions. 

The introduction of Pix, an instant payment platform, in November 2020 was a key milestone in the evolution of Brazil’s payments system.  This platform enables the instant execution of electronic payments and transfers and is the result of extensive consultation between the BCB and participants in the payment system since the creation of the Working Group on Instant Payments in 2013.  The BCB (i) issues the regulation that governs Pix and supervise its compliance, and (ii) manages the platform´s technological infrastructure.  This centralization allowed the BCB to provide a public, safe, and low-cost infrastructure that is highly integrated with market players in the Brazilian payment system that intermediate between final users and the Pix´s instant payment system.  By the end of 2021, transactions in Pix surpassed both credit and debit card transactions thanks to a network that includes close to 800 private PSPs, including traditional banks and fintech companies (Figure 9.1).  The Pix also served almost two thirds of the adult population and close to 60 percent of the firms interacting with the national financial system.  Furthermore, the cost to merchants of accepting retail payments is much lower than credit and debit card payments (Figure 9.2).  Interestingly, this innovation has been widely accepted by all financial institutions since the total number of transactions has increased for all parties thanks to increased financial inclusion in Brazil.

The Digital Real could aim at creating an additional layer to the digital payment system building on innovative technologies and policies under the BCB’s regulatory umbrella.  The BCB is considering features of programmable money for the development of smart contracts using the Digital Real to help expand the range of digital payment services and stimulate the development of digital innovations.  Additional policies, like the introduction of the Open Banking initiative since the beginning of 2021, could also contribute to fostering competition in the provision of these innovative financial services.  Open Banking allows customers to share their financial data with other institutions under the BCB supervision to allow them to compete and offer alternative financial services. 

As part of the proof of concept of its CBDC, the BCB has launched a new edition of the Lift Challenge focused on the Digital Brazilian Real.  To identify concrete projects in such a dynamic context, the last edition of the Lab for Financial and Technological Innovations´ (Lift as in its Portuguese acronym) Challenge called for projects related to CBDC.  The BCB selected 9 projects from different institutions that include traditional banks, credit card, fintech, and technological companies,  DeFi lending platforms and crypto assets’ exchanges.  The pilot implementation of these projects is expected in 2023 and enlighten further discussion on the future of the Digital Real. 

The BCB would eventually decide the characteristics of its CBDC in 2024, after testing its own pilots in 2023.  The Digital Real would be issued by the BCB and under the custody and distribution of the Brazilian Payments System.  Although it is too early in the process to envisage the characteristics of the Digital Real, the BCB has suggested that it would most likely be online given the technical difficulties of an off-line CBDC, although an offline option has not been discarded.  It would not bear interest to limit potential financial disintermediation risks.  Its introduction would need a change to the Central Bank Law, but it would not affect existing data privacy and security provisions that are embedded in Bank Secrecy and Brazilian General Data Protection Act.  A CBDC would need to comply with court orders to track illicit transactions, a task that a CBDC is likely to facilitate efficiently.  The systems already in place, including for Pix, may support domestic interoperability.  The BCB is keen on engaging with other jurisdictions to ensure interoperability across borders and to reduce the costs of cross-border payments. 

Chile 

The Central Bank of Chile (BCCh) has published a white paper and has called for a public survey to evaluate the risk and benefits from the potential issuance of a retail CBDC.  The BCCh established a working group to assess the existing retail payment system and evaluate the issuance of a CBDC in 2021.  It published a first white paper with a preliminary assessment of benefits and risks of issuing of a retail CBDC.  The paper found that the Chilean retail payment system was adequate for the needs of the Chilean economy and highlighted the principles that a CBDC should follow.  It concluded that, although a retail CBDC could address several of the challenges from the rapidly changing payments ecosystem, the decision to issue a CBDC should be based on a thorough cost-benefit analysis.  To better inform this analysis, in July 2022 the BCCh called for a survey to the citizens and corporates about the risks and benefits from the potential issuance of a retail CBDC.  The respondents had until October 2022 to answer the survey.  The BCCh is currently working on a second stage of digital currency exploration, holding seminars, talks and roundtables to get feedback from the private sector, especially on financial stability issues.  A second report is expected to be published in the first half of 2023. 

Colombia 

The Banco de la República (BanRep) began research into retail CBDCs in 2017 in the context of the need to further develop its instant payment system.  Although the use of e-payments has grown since the pandemic, it is still lagging behind that of peer countries.  In its study, BanRep focused on the impact of a CBDC on financial intermediation and credit supply, financial inclusion and stability, monetary policy transmission, as well as on the impact of foreign CBDCs.  BanRep will continue further cost-benefit analysis of CBDCs. 

Peru 

The Peruvian authorities conducted an initial assessment of the possibility of introducing a CBDC with technical assistance support from the Fund following the principles suggested in section I.B above.  [add reference].  This meant probing the underlying assumptions to the problems facing the Peru payment system and identify potential solutions (which may or may not include the introduction of a CBDC). 

Despite recent efforts, financial inclusion and the adoption of digital retail payment services in Peru are low.  Building on its 2015 financial inclusion strategy, Peru developed a National Financial Inclusion Policy (PNIF) in 2019 to promote financial access to all segments of society.  Despite the associated efforts, still 48 percent of the Peruvian population was unbanked as of mid-2021.  The lack of financial inclusion is more acute among rural residents due to generally lower incomes and wealth and geographical factors like low population density in rural areas that make banking services less accessible and more expensive.  Promotion of an effective digital payment system has not been a solution as major e-wallet providers do not interoperate among themselves or with unaffiliated bank deposit accounts because the largest banks operate in their own closed-loop systems.  BIM, a national platform to ensure interoperability of e-money payments, fails to support connectivity with unaffiliated e-money issuers or bank deposit accounts.

Initial analysis point towards several barriers against financial inclusion and digital payment adoption in Peru.  They include (i) limited digital and financial literacy, (ii) insufficient telecommunications infrastructure, (iii) a “culture of cash” and high informal labor participation, (iv) low wages and wealth levels, (v) elevated fees and fragmentation (lack of interoperability of solutions) in the banking sector, (vi) distrust of financial services and preferences for privacy, and (vii) limited access points including digital infrastructure especially in more remote locations.  Surveys conducted by the IMF highlighted some motivational, capacity, and behavioral factors that would reinforce the preference for cash, including concerns on high costs, the preference for informality, low ubiquity of current solutions, and related low perceived benefits of digital solutions. 

The IMF mission identified as viable solutions to enhance digital payments either to reinforce existing payment instruments and systems or to introduce a CBDC.  The first option would entail an intervention by the central bank of Peru to mobilize stakeholders to interoperate existing stores of value (e.g., accounts, digital money, and e-money) and connect and enhance a select set of existing payment systems to be fully interoperable and accessible to all (e.g., faster payments and/or debit cards). The issuance of a CBDC (in tokenized form in Peru) would require a sound legal basis to ensure a high level of legal certainty, legal tender status, regulation, and oversight of relevant actors, and more generally the mandate of the BCRP to carry out necessary functions and pursue interoperability.  All this would need to be accompanied by capacity building across the jurisdictions to ensure that regulatory, supervisory, and law enforcement authorities are equipped to adapt to the introduction of a CBDC.  In any case, a robust evaluation of technical, operational, regulatory, financial, and economic risks of CBDC or alternative solutions will need to be conducted before making a decision in one way or another. 

In that context, three critical enablers and four specific factors were identified as foundational elements for the successful introduction of any solution.  The critical enablers include: (i) creating a clear and compelling vision to enhance payment services to the financially excluded; (ii) the inclusion, involvement, and support from stakeholders (both public and private sector); and (iii) a facilitating mechanism to enable cooperation between competitors (such as a payment system management body).  The four factors to catalyze the adoption and usage of solutions include (i) efficient “on and off ramps” between cash and the digital payments ecosystem; (ii) provision and promotion of digital payment solutions by government and businesses (including awareness campaigns and appropriate pricing); (iii) the widespread availability of payment acceptance infrastructure; and (iv) solutions that support multiple types of payments. 

Finally, it is worth mentioning the introduction of a digital wallet by Ecuador in 2014 as an initiative that could appear as a failed CBDC.  It involved the issuance of digital currency by a central bank that was not the issuer/“owner” of the currency in a fully dollarized economy that has the U.S. Dollar as the sole legal tender.  The digital currency was offered directly by the Central Bank of Ecuador with the stated objective of promoting financial inclusion and backed in principle by U.S. dollar assets in its balance sheet.  The central bank kept all the users’ personal data and transaction records at its platform.  This initiative did not attract much demand and it was abandoned in 2018 in the context of distrust about the true reasons for its creation and potential risks of dedollarization and monetary instability.  In fact, a sharp fall in international oil prices during the 2014-2018 period led to large fiscal deficits that were partly financed by the central bank’s international reserves.  The lack of credibility would explain why Ecuador’s digital wallet initiative was not successful (including as an engine of financial inclusion) in contrast to the experience of other emerging and developing economies around the world.

Lessons and Policy Recommendations 

The onset of crypto assets and CBDCs is transforming money and payments.  The description and analysis in this paper of the experiences in LAC stress the opportunities and risks brought about by them and their underlying technologies for a diverse region facing challenges ranging from relatively low financial inclusion and fragmented payment systems to volatile macroeconomic conditions and capital flows.  As shown by the recent sharp fall in their values, crypto assets imply more risks than benefits (particularly given the lack of intrinsic value of unbacked crypto assets) but should be expected to continue to be part of the payment system’s landscape.  By contrast, (properly designed) CBDCs could help achieve some public policy objectives, including facilitating remittances.  In that context, some policy recommendations are laid out below in terms of enhancing the policy and regulatory frameworks to respond to crypto assets’ risks, using digital currencies to enhance cross-border payments, and introducing CBDCs.

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The Caribbean Community Heads of Government commended Canadian Prime Minister, the Rt. Hon. Justin Trudeau for continuing the legacy of strong relations between CARICOM and Canada

CARICOM, Canada Strengthen Relations

Diplomatic relations between the Caribbean Community (CARICOM) and Canada were strengthened on Thursday 16 February with an engagement between the Conference of Heads of Government and Canada’s Prime Minister, Rt. Hon. Justin Trudeau, in The Bahamas.

The two parties discussed the situation in Haiti, climate change and climate financing, trade, increased people to people contact, regional security, among other issues.  

In his address to CARICOM Heads, the Canadian Prime Minister announced a new funding initiative totaling $44.8 million to tackle the climate crisis in the Caribbean.

He said the fund will support projects within regional organisations like the Caribbean Community Climate Change Centre (5Cs), and the Caribbean Biodiversity Fund to improve marine and coastal ecosystem management, increase water security and to help governments respond to the impacts of climate change.

Acknowledging the challenges CARICOM countries face with accessing concessional development financing, he applauded the Bridgetown Initiative led by Prime Minister Mia Mottley of Barbados.  The Initiative has “re-energised the conversation on International Financial Institutions’ reform to the overlapping health, climate, debt, and liquidity crisis affecting many CARICOM countries,” the Canadian Prime Minister stated.

On the trade side, he said Canada is seeking a renewal of a waiver from the World Trade Organisation for goods from the Region to enter Canada duty-free beyond 2023, through the CARIBAN programme.

CARIBAN was announced in Nassau during a CARICOM Heads of Government Conference in 1985 and Prime Minister Trudeau said it is “only fitting” that CARICOM-Canada Heads of Government renew their commitment to the trading agreement during their meeting Thursday.

CARICOM-Canada reciprocal trade reached $1.9 billion in 2021, while bilateral trade in services reached $3.9 billion, Prime Minister Trudeau told CARICOM heads as he highlighted the strong trade ties between the two parties.

Heads of Government commended Prime Minister Trudeau for continuing the legacy of strong relations between CARICOM and Canada.  They advocated for his country’s support on concessional funding for climate change related loss and damage, recovering from disasters, and development financing.  Heads also emphasised the need for increased people-to-people contact between CARICOM and Canada through the restoration of visa-free travel.  In response to the latter, Prime Minister Trudeau said that Canada will in the coming days, announce new measures to simplify access to “trusted travelers” from CARICOM and other countries in the Region.

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The Bahamas Immigration Minister Keith Bell resists United Nations - UN call to suspend deportations to Haiti as Haiti's crisis deepens

The Bahamas Immigration Minister Keith Bell resists UN call to suspend deportations to Haiti as situation spirals out of control

“Haiti has political instability, economic deprivation, and complete social collapse.  So you are talking about a myriad of challenges and problems.  That problem can only be addressed at the international level and so it isn’t a matter of frustration

DESPITE calls from United Nations officials to suspend deportations to Haiti, Immigration Minister Keith Bell said The Bahamas has “a job to do” to ensure that officials protect the country for Bahamians.

The Bahamas is facing an influx of Haitian migrants.  However, United Nations Secretary General António Gutierrez on Monday called on governments to consider halting deportations as the situation there spirals out of control

Speaking on the sideline of a Labour on the Campus event, Mr Bell recognised the duty of the secretary general, but made it clear what the government has to do.

“The United Nations obviously they seek to ensure that there is harmony, there’s unity among all nations, so obviously that is his job.  We in The Bahamas have a job to do to ensure that we protect The Bahamas for Bahamians.  It’s as simple as that.  The Bahamas as all governments have consistently said we cannot absorb these persons who come in The Bahamas illegally,” he said.

“If you want to come to The Bahamas as a tourist or want to work, then there is a process.  If you follow that process, you may be granted access to The Bahamas.

“If you come here illegally and unlawfully, then, of course, there has to be swift justice.  We will not tolerate, nor will we support reasonably anyone coming into The Bahamas from undocumented or illegal means you will stay in the jurisdiction you will be deported.”

He also shared doubts that The Bahamas would sign on to provisions allowing for free movement when asked about CARICOM’s freedom of movement or labour within the region.

“I know you’re talking about a treaty – I think the Treaty of Chaguaramas and the (free) movement of people through the Caribbean.  The government of The Bahamas, both PLP and FNM, has consistently not signed on to those specific provisions.  I do not foresee in the very far future that we’re going to support a free movement throughout this country of anyone.”

Prime Minister Philip “Brave” Davis said the crisis in Haiti poses a substantial threat to The Bahamas due to an increase in irregular migration.

He spoke earlier this week at the opening session of the heads of summit meeting of the Community of Latin American and Caribbean States (CELAC) in Buenos Aires, Argentina.

During his remarks, Mr Davis stated: “With the support and leadership of Haiti, collectively, we can, through CELAC and other regional organisations, help Haitians build a path out of crisis.”

Asked if there was frustration with the international community over addressing Haiti’s issues, the labour minister listed some of the factors that needed to be considered when helping countries.

“I will not say it there is frustration and you would have seen all around the world where first world developed countries, superpowers go into these countries where they need help — where there is a genocide or there is this civil war and the like.  When you go into these countries you have to ensure first of all, what is your objective?  What are the objectives of you going in?  And what would be your exit strategy?

“Haiti has political instability, economic deprivation, and complete social collapse.  So you are talking about a myriad of challenges and problems.  That problem can only be addressed at the international level and so it isn’t a matter of frustration.

“It’s just a matter of how we’re going to address these issues and challenges and then determine how we can help, but Haiti has 12 million people, The Bahamas cannot under no circumstance, support any illegal and unlawful entry of persons from Haiti and that has extended to Cuba where we’ve had an exponential growth in illegal migrants coming from that country. We will not tolerate it.”

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An Increase In The Influx of Illegal Immigrants In The Bahamas

The Influx of Illegal Immigrants In Bahamian Territory 

The Bahamas Immigration Department remains active in its efforts to apprehend and process numerous illegal migrants that entered the country over the past few days.

On today’s date, 25th January 2023 at approximately 9:57 a.m., the latest group of migrants consisting of eighteen (18) Cuban nationals; seventeen (17) males and one (1) female, were found in waters near Cay Sal Bank United States Coast Guard (USCG).  The migrants were turned over to the Royal Bahamas Defence Force (RBDF), and are expected to arrive in the capital on Thursday, 26th January 2023 where they will be received by Immigration officials.

Additionally, on Tuesday, 24th January 2023 at approximately 6:00 a.m., three hundred and seventy-five (375) Haitians and two (2) Cuban nationals were turned over to Immigration officials in Matthew Town, Inagua after being intercepted by the United States Coast Guard (USCG) in waters near Cay Sal Bank.  The group will remain in facilities on the island where they are being processed.

On the same day, at approximately 10:25 a.m., Immigration officers on Cat Cay, Bimini apprehended seven (7) Cuban National; five (5) males, one (1) female, and one (1) minor; the group was subsequently transported to the capital today for processing.

Lastly, at approximately 9:30pm the Immigration Department was notified by locals in the community of The Bluff, South Andros of an abandoned wooden sloop suspected of carrying Haitian migrants.

A task force comprising twenty-three (23) officers from the Immigration Department and Royal Bahamas Defence Force was immediately dispatched to the island to investigate.  Once on the ground, the team commenced operation; and as of 2:35 p.m. on 25th January 2023, apprehended forty-one (41) Haitian nationals; thirty-one (31) males and ten (10) females thus far.

This is an active and ongoing apprehension exercise as more Haitian migrants are suspected to be on the island.  The Department is presently working with local agencies on the island to ensure all health and safety protocols are followed.

Subsequently, all migrants will be transported to the capital for further processing and arrangements are presently being coordinated for the deportation of all irregular migrants.

For more information, call the Public Relations Unit at 1-242-322-7530, visit our website at www.immigration.gov.bs, or call our Investigation hotline anonymously at 1-242-604-0249.

The Bahamas Prime Minister, Philip Davis addresses The Community of Latin American and Caribbean States - CELAC on the growing challenges which threaten the safety, security and undermine the pursuit for economic dignity in the region

The economic and security challenges we face are great, and we welcome CELAC’s initiatives to strengthen cooperation in facing them.  Collaboration makes us stronger, and leads to faster and more durable solutions

Buenos Aires, Argentina - January 24, 2023 - Colleagues: Over the past several years, the Covid-19 pandemic compounded the complex problems we already faced, including climate change, economic inequality, and increasing threats to democratic values and human rights. 

These growing challenges threaten our safety and security and undermine our pursuit for economic dignity. 

Every one of our citizens deserves the right to experience the joys of family life, to do meaningful work, and to live lives full of purpose.

When we gather in regional meetings like this one, we must make sure that our debates and agreements concerning infrastructure and institutions always prioritize results that make a difference at the level of individual families.  People must come first.  And until doors of opportunity are open for all, we cannot rest. 

Climate Change 

Colleagues: Rising sea levels pose an existential threat to my country.  In 2019, a Category 5 storm devastated two of our main islands. 

We are not and have never been the polluters, yet we suffer from the greatest vulnerabilities caused by carbon emissions. 

Our debt burden remains high, in significant part due to these climate risks, including the need to regularly rebuild homes, businesses and infrastructure after devasting hurricanes.  Our cost of borrowing also prices in the risk of future hurricanes; we are already paying a high price for the intensifying weather patterns of tomorrow.

We urgently need the developed countries to honour their commitments to compensate for the Loss and Damage associated with climate change.  And in order to build resiliency, we urgently need finance and access to technology. 

Each of our countries must keep the pledges we’ve made, in this and other settings, to reduce our own emissions.  We have seen glimpses of a future we cannot survive; we must change course, or perish. It is that simple. 

Regional Peace and Security

Colleagues: Democracy cannot be taken for granted; it is a commitment that must be continually renewed.  Just over two weeks ago, a violent mob stormed government buildings in Brazil in an effort to overturn the outcome of free and fair elections. 

I reiterate the solidarity of The Bahamas, and CARICOM, with President Lula de Silva and the Government of Brazil, and our unwavering commitment to democracy and rule of law. 

The scenes in Brasilia uncomfortably echoed those just a few years ago in Washington, DC.  Political violence, in all its forms, must be condemned anywhere in the Americas. 

Haiti 

Colleagues: The crisis in Haiti is getting worse.  The tragic situation there continues to pose a substantial threat not only to Haitians, but also to The Bahamas and neighbouring countries, all of whom are experiencing a significant increase in irregular and often dangerous migration. 

With the support and leadership of Haiti, collectively, we can, through CELAC and other regional organizations, help Haitians build a path out of crisis.

We commend Haitian-led efforts to hold elections before the end of 2023, to arrest the threat to public security posed by violent gangs, to relieve hunger and malnutrition, and to alleviate the political crisis. 

Enhanced regional partnership can especially help to scale up capacity-building for the local police, and tackle trafficking, particularly in people, contraband and guns. 

These Haiti-led solutions provide promising alternatives to the usual inclination to carry out activities in Haiti without Haitian direction, and the preference for investing in the strengthening of the NGOs in Haiti, as opposed strengthening her public institutions. 

Extra-Regional Partnerships 

In terms of the wider region, the economic and security challenges we face are great, and we welcome CELAC’s initiatives to strengthen cooperation in facing them.  Collaboration makes us stronger, and leads to faster and more durable solutions.

International Obstacles to National Development 

And even while we pursue national development, other international partners pursue policies which harm our progress.  The Bahamas will continue to voice its displeasure with the discriminatory practice of the blacklisting of countries.  I invite you to join us. 

We will also continue to advocate against the unfair use of GDP per capita to determine how or if developing countries, in vulnerable developing regions, qualify for reasonable concessionary financing or grants.

The use of the Multi-Vulnerability Index in assessing eligibility for help, rather than the blunt, outdated measurement of GDP per capita is a fairer measurement.  I invite you to join us in advocating for mutual agreement of alternative eligibility criteria for international financing and Overseas Development Assistance.

Summit Declaration 

Colleagues: Dialogue is important; collaborative solutions cannot be built without it.  But talk is not sufficient.  The work we do here must translate into tangible benefits for our citizens.  Let us share a determination to make each meeting, and each conversation, a stepping stone to real progress for people.

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The Bahamas Prime Minister Philip 'Brave' Davis brings focus on Illegal migration and gun trafficking to meeting with US Vice President Kamala Harris

The United States reaffirmed their commitment to strengthening partnerships with The Bahamas, and the nations and peoples of The Caribbean

As Chairman of CARICOM, the Bahamian Prime Minister believes it is important for the United States and other partners in the hemisphere to support Haitian-led efforts to stabilize that country and find a path forward out of crisis

Washington, DC - January 17, 2023 – Prime Minister Philip 'Brave' Davis met earlier today with US Vice President Kamala Harris at The White House to discuss a number of issues facing The Bahamas and the wider Caribbean region.

The United States reaffirmed their commitment to strengthening partnerships with The Bahamas, and the nations and the people of The Caribbean.

In discussing items relating to our bilateral relationship, the Prime Minister and the Vice President emphasized the importance of both strengthening efforts to combat illegal maritime migration and reducing the flow of guns illegally entering The Bahamas from the United States.

The Prime Minister also raised the importance of reinstating pre-clearance facilities in Grand Bahama, a critical step to support the island’s economic recovery.

The discussion widened to cover a number of regional issues, including food and energy security, and efforts to combat climate change.

As Chairman of CARICOM, the Prime Minister believes it is important for the United States and other partners in the hemisphere to support Haitian-led efforts to stabilize that country and find a path forward out of crisis.

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What are the characteristics that distinguish Cuban vaccines against COVID-19?

How is the international recognition, and the evaluation by WHO, of Cuban vaccines against COVID-19 going?

Clinical studies showed the Cuban vaccines against COVID-19 have over 90% efficacy.

By Liz Conde Sánchez | internet@granma.cu

More than a year after the beginning of the massive anti-COVID-19 vaccination in our country, Cuban vaccines against the pandemic continue to prove to be safe, effective and capable of controlling the epidemic, even against the new highly contagious variants of the virus appearing in the world.

The sustained control of the incidence of the disease on the Island is a reliable proof of this.  Another one is the growing international recognition obtained by Cuban vaccines, regardless of the progress of the recognition process by the World Health Organization (WHO).

In an interview, with Dr. Eduardo Martínez Díaz, president of the BioCubaFarma business group, he listed the characteristics that make Cuban vaccines stand out, the evidence that proves their effectiveness, the international recognition they have obtained, and the evaluation process by the WHO.

- What are the characteristics that distinguish Cuban vaccines against COVID-19?

- Cuban vaccines against COVID-19 have several characteristics that make them stand out among others that have been developed.

"First, they have proven to be very safe.  After dozens of millions of doses applied, in Cuba and in other countries, it has been observed that adverse events are mild and with a very low frequency, even in pediatric population from two to 18 years old, which is a unique experience in the world to date.

"These are not casual results; the very nature of the technological platforms used and the design of the vaccines justify them.

"Secondly, these vaccines have high thermo-stability.  Unlike others that require special conditions for storage, at freezing temperatures, ours can be stored between 2 and 8 degrees Celsius.

"They have even been shown to maintain their quality characteristics at temperatures above 30 Celsius degrees for at least a week, making them attractive for use in poor countries where there are difficulties in maintaining the immunogen's cold chain.

"Thirdly, Cuban vaccines have proven to be very effective.

"In the clinical studies carried out, they have proven to have an efficacy of over 90 %.  However, the most important evidence of their effectiveness was the decrease in the transmission of the disease in Cuba, starting October 2021, when the population have been immunized in 60% using Abdala and Soberana vaccines."

- How effective have Cuban vaccines proven to be against the Omicron variant?

- Cuban vaccines have proven to be effective against the Omicron variant, the most infectious variant of this disease known so far.

"Epidemiological evidence proves it. In Cuba, unlike most countries in the world, the peak of infections with the Omicron variant and its subvariants have been lower when compared to the previous ones, including the peak with Delta.

"Undoubtedly, the effectiveness of the vaccines created by our scientists against these new SARS-COV-2 strains and the vaccination strategy have a lot to do with this behavior on the island.

"We have found, in laboratory studies done in Cuba and in other nations, that the antibodies induced by Cuban vaccines neutralize the Omicron variant.  While some vaccines report a decrease of up to 20 times in their capacity to neutralize the Omicron variant of SARS-COV-2, compared to the original, Cuban vaccines only decrease this neutralization capacity by two times.

"This phenomenon we are observing has its explanation in the nature of the antigen we use and the very design of our vaccines.

"The Abdala and Soberana vaccines use the RBD antigen, that is, the spike (S) protein region, which binds to the virus receptor in the cell.

"The RBD antigen has been found to induce neutralizing antibodies against a conserved region of that protein among the different variants of the virus, possibly because of the importance of that region in the functionality of the virus; therefore, mutations in this area of the protein are not selected.

"However, when immunized with the complete spike (S) protein, this conserved region is not immunodominant, in other words, antibodies are preferentially induced against other areas of the protein, in which there is a high rate of mutations, and a process of selection of variants that escape recognition by neutralizing antibodies occurs.

"Most of the vaccines currently on the market use the spike (S) protein as antigen, which has generated the phenomenon of successive pandemic peaks resulting from the appearance of variants of the virus that escape the immunity generated by these vaccines.

"We defend the hypothesis that vaccines based on the RBD antigen may constitute a universal booster for the rest of the vaccines against COVID-19, amplifying a protective immunity against the different variants of the SARS-COV-2 virus, which have circulated or could appear in the future.

"Recently, several groups of scientists around the world have published papers supporting this hypothesis."

- How is the international recognition of Cuban vaccines advancing?

- All these results have been published in recognized scientific journals, which means, they have been reviewed by international experts, in a peer review process.

"To date, more than 20 scientific articles have been published in high-impact journals and other reports are being prepared.

"Cuban vaccines have also been evaluated by regulatory authorities in several countries, which have finally granted the Emergency Use Authorization.

"Eight countries have given this authorization so far and others are evaluating them.

"Not so long ago, a group of experts and scientists from prestigious institutions in the United States, the Caribbean and Africa visited our country and had access to all the information available on the results obtained, held meetings with specialists, doctors, scientists and technologists, both in health institutions and in biotechnological facilities, recognizing the work done and the quality of Cuban vaccines, and issued a public report".

- How is the process of evaluation and recognition of Cuban vaccines by the WHO going?

-The WHO recognition process started this year, and several steps have been taken in line with the established procedures.

"Information from the Abdala vaccine dossier has been sent and is being exchanged with those authorities.

"However, one of the components of the evaluation process is behind schedule.

-The delay is due to the visit of WHO experts to the plants where the vaccines are manufactured.

"We had prepared this visit to take place at the end of the year at the production facilities of the CIGB-Mariel biotechnology complex, where the production of the Abdala vaccine is being transferred.

"Although the production line, in which the formulation, filling and packaging operations of that complex are already active and producing, the line in which the recombinant products are manufactured has delays in its start-up.

"This delay is given because it has not been possible to make the payments to the company in charge of the start-up of the equipment and systems of that production line.

"We have been trying for nine months to make the payments, which have not been possible due to the refusal of several banks to make the transfer operation.

"Notwithstanding these difficulties, we’ve made progress and we hope that the WHO evaluation process will be completed in 2023."

Translated by ESTI

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The Securities Commission of The Bahamas once again corrects material misstatements made by Mr. John J. Ray III, the representative of the U.S. FTX debtors (“Chapter 11 Debtors”), in both the press and court filings

Securities Commission of The Bahamas Corrects Material Misstatements made by Chapter 11 Debtors 

Nassau, The Bahamas, Monday 2 January 2023 – The Securities Commission of The Bahamas must once again correct material misstatements made by Mr. John J. Ray III, the representative of the U.S. FTX debtors (“Chapter 11 Debtors”), in both the press and court filings. 

On 30 December 2022, the Chapter 11 Debtors publicly challenged the Commission's calculations of the digital assets which were transferred to digital wallets controlled by the Commission on 12 November 2022 for safekeeping in the exercise of its powers as regulator acting under the authority of an Order made by the Supreme Court of The Bahamas. 

Such public assertions by the Chapter 11 Debtors were based on incomplete information.  The Chapter 11 Debtors chose not to utilize their ability to request information from the Joint Provisional Liquidators pursuant to a court order of the Supreme Court of The Bahamas that the Commission obtained in an effort to allow the Chapter 11 Debtors to obtain this information. 

The US Debtors’ continued lack of diligence when making public statements concerning the Commission is disappointing, and reflects a cavalier attitude towards the truth and towards The Bahamas that has been displayed by the current officers of the Chapter 11 Debtors from the date of their appointment by Sam Bankman-Fried. 

Previously, Mr. Ray made public statements alleging that the Commission gave instructions to “mint a substantial amount of new tokens.”  These statements were made in a court filing on 12 December 2022, without evidence, and then made again under oath, on 13 December, before the United States’ House Financial Services Committee. 

Statements suggesting that Bahamian officials directed FTX employees to mint USD300 million in new FTT tokens were widely reported by the international press.  Such unfounded statements have the impact of promoting mistrust of public institutions in The Bahamas. 

The Commission addressed the process by which it took possession of digital assets under the custody or control of FTX Digital Markets Ltd. (“FTXDM”) or its principals, both in a court filing and, its statement of 29 December 2022. 

The Chapter 11 Debtors have also alleged that the digital assets controlled by the Commission in trust for the benefit of customers and creditors of FTXDM were stolen, without providing any substantiated bases for such claims, particularly, as to their claims to ownership of the assets. 

Per US Debtors’ own court filings, they appear to recognise that there are disputed claims to those assets.  

As the Chapter 11 Debtors' own filings reveal, Ryne Miller, General Counsel of FTX US, stated "As long as it's custodied somewhere safe, we can sort it out as the time goes."  Mr. Miller correctly recognized what the Commission recognized at the time: that it was vital that assets be custodied somewhere safe to secure those assets, and allow any disputed claims to those assets to be resolved at a later date. 

Mr. Ray has not once reached out to the Commission to discuss any of his concerns before airing them publicly.  The Commission has still not received a response to its 7 December 2022 letter to Mr. Ray offering cooperation with Chapter 11 Debtors. 

The Commission is extremely concerned that its investigation (particularly the gathering of critical supporting evidence) is being impeded by the Chapter 11 Debtors’ insistence on not allowing the Court Supervised Joint Provisional Liquidators access to FTX’s AWS system. 

The Commission notes that proceedings being conducted by the authorities in relevant jurisdictions should have the dual aim of pursuing justice and ensuring that all customers and creditors of FTX be made whole, with the support and cooperation among supervisory authorities in each country. 

To this end, the Commission hopes that the Chapter 11 Debtors proceed with these matters in good faith and the best interest of customers and creditors of FTX. 

Prior releases issued by the Securities Commission of The Bahamas may be viewed at: https://www.scb.gov.bs/media/newsroom/media-releases/.