Nick Silver shares his entertaining experiences of an enviable and extraordinary pensions consulting assignment in the Caribbean Community (CARICOM) member states

Guyana looks quite small on the map, but when flying over a country the size of Britain with only 750,000 people, you see that it consists of vast areas of jungle with little sign of human activity. Driving from the airport to Georgetown along the Demerara River, where the sugar comes from; in the blazing heat through dense jungle, I was overcome with a sense of the absurd - was I really here to carry out actuarial work? At this point I decided that my trip might make an interesting article for The Actuary - part travelogue, part exploration of the limits of pensions consulting.
Regretfully I had to give up the other 10 countries to my colleagues (I was especially upset about Montserrat) but I just had to get over my disappointment. My secret, private mission was to decide which country produced the best rum. Of course the thought of checking out the beaches and bars never crossed my mind - I was here to work.
Geographically Guyana is not in the Caribbean - it neighbours Venezuela on the South American mainland. However, the majority of the population is English-speaking Afro-Caribbean. Georgetown is wonderfully atmospherically ramshackle; it consists of dilapidated colonial buildings all made of wood and has an edgy Wild West feel. My fellow hotel guests were aid workers who had just been hacking through the jungle.
The country has serious problems - young people have little prospects and mostly leave, migrating to Europe and North America (as opposed to other Caribbean countries). Those that remain often work in the 'informal' sector - this might mean legal informal, such as market stalls, or illegal informal - Guyana is a major drug smuggling transit route which makes up a large proportion of the economy - the other mainstay being remittances from abroad. This means that the social security system has to deal with an effectively ageing population despite the high birth rates and with large sectors of the economy non-compliant.
Just prior to leaving Guyana a friend sent me an email with attached weather map with the comment, "Aren't you somewhere here"? The map showed hurricane Tomas forming between me and the rest of my destinations. Given the local airline's reputation - LIAT is reputed to stand for "Leave Island Any Time", I steeled myself for a long stay in Guyana.
However, I managed to get on the last plane to leave for my next destination, Trinidad - I was the only passenger at the airport. I had the weekend in Port of Spain, which I soon realised was a mistake - it resembles the set for the TV crime drama The Wire. Their social security system had an interesting design - the government had continuously raised the minimum pension, so that now the entire population received the minimum. Unlike the other Caribbean nations Trinidad is industrial - based on oil and gas. This makes it quite ambivalent towards CARICOM as they feel they do not have much in common with the other countries.
Next stop Grenada. I arrived there at night and went down to my hotel bar for a quick drink. On entering the bar I had to suppress a laugh - this was how you imagined the Caribbean; straw-roofed rum shack on golden sand beach, turquoise sea - and someone was paying me to be here!
Grenada is famous for two things, hurricane Ivan, which had wiped out the island in 2004 and the US invasion of 1983 (I wondered how a country of 100,000 of the most laid-back friendly people you will ever meet could have posed a threat to American national security).
Fortunately its history seemed to have kept the developers at bay so the island is still unspoilt. The social security system is by far the largest investor in the country. It invests 100% domestically; as you can imagine there are not many liquid investments in Grenada, so the system has to be highly innovative, for example it is the largest mortgage provider in Grenada. The words risk concentration immediately spring to mind. I spent a hard afternoon working in the hotel bar/restaurant as an improvised office.
My only regret about Grenada was that I was only there one night. A similar whistle-stop trip to St Vincent followed - another small country with similar issues to Grenada. Kingston had a ramshackle, pirate feel to it. I shared my very nice hotel with a famous hip-hop singer and his entourage, visiting for a gig and they kept me up all night (not in a good way).
The social security system is run by the highly flamboyant Mr Thomas. He has instituted a series of innovative measures to get popular buy-in, for example carnivals celebrating old age and school booklets explaining the system (which are the best and clearest communications documents on the subject I have seen).
I finally ran into the aftermath of Hurricane Tomas in St Lucia. I arrived in the middle of the night to be told that the hotel was not taking guests as there was no running water. I might have been less than amused had I been here on holiday, and the few holidaymakers who had rationed showers at 7am only were clearly not amused, but I was here on work; the slightly shady motel which was the only place taking guests would be considered luxury in the African countries that I have frequented recently.
My meeting was cancelled as the head of social security had to try and rescue his mother whose house had been washed away. It's hard to imagine how long it would take to repair all the damage - the water and roads were out - and this was only a minor hurricane.
Next stop Dominica. I had finally reached paradise. Dominica is so lush that if you plant a metal rod in the ground it would probably blossom. Fortunately the social security staff were too polite to notice my appallingly disheveled state from lack of washing and sleep; my suit had not been pressed for six countries, instead insisting that they show me round the island.
The ravishing beauty of the place masks a dire economy - the mainstays of which are bananas, which was undermined by the EU/US trade agreement, and tourism - the island has no beaches and only 800 beds in the whole country. Young people mostly leave - from my perspective leaving an ageing and underfunded social security system. The dilemma is that this lack of development means that the country is unspoilt and a wonder to behold.
Dominica's airport has no lights so planes cannot land when it's dark. My 5pm flight was always going to be pushing it, but being on time proved too much for LIAT, so with impressive nonchalance the flight was cancelled, as were all my meetings in Barbados the next day. This was my eighth flight with LIAT on the trip, so I couldn't really complain. And, if I had to chose somewhere in the world to be stuck, Dominica would probably be my first choice. I had my extra day in an eco-lodge with my own natural hot spring - it certainly beats working on Solvency II.
Last stop Barbados. This is the most developed of the islands; it has a sophisticated economy and high standard of living. The social security system is impressively run; it is one of the few places in the world that has successfully reformed into a sustainable system. Quite rightly the other countries look to Barbados for leadership.
The conclusions of my work were that the systems could be tweaked towards harmonisation, but people do not really move between countries -there is not much reason for someone to move from, say Grenada to St Vincent, they are too similar. Migration is outward, mainly to the US, UK and Canada, and inward from countries like Brazil, Cuba, The Philippines and China. The systems therefore need to address reciprocal arrangements with these countries. However, the systems face other problems which might be easier faced if they pooled resources.
Most countries are invested entirely within country - they are normally by far the single largest investor in their own country. You can understand why they do this, but that entails a massive risk concentration, especially in these hurricane-prone islands. Together they could pool investments, there is a Memorandum of Understanding in place for them to do this which is a positive development. Another problem is lack of capacity, again this could be addressed by pooling resources, there is no reason why they all have separate administration, IT and actuarial functions.
Unfortunately, the beauty of the islands masks severe underlying economic problems, with lack of diversity and ageing populations. The innovative and talented staff of the social security systems do the best they can with the limited resources at their disposal, but I fear they face difficult times ahead.
I left Barbados for home exhausted but having had one of the more interesting fortnights of my working life. Finally, to put readers out of their suspense, you can take it on authority that the best rum is 21-year-old El Dorado from Guyana.

An interactive map of the Caribbean can be found at http://www.lonelyplanet.com/caribbean
Read the second part of Nick Silver's travel tales as he tours Tajikistan: 'Actuaries! In an adventure with climate change scientists!'
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