Haiti Earthquake Aftermath Overwhelms the Caribbean, the Deepwater Horizon Spill Begins in the Gulf and Greece Accepts Its First Bailout

Jamaica Homes Global Conflict & Caribbean Impact Review | Published 3 July 2010 | Reporting Period: 3 April – 2 July 2010

Quarterly Briefing

• BP’s Deepwater Horizon drilling rig explodes and sinks in the Gulf of Mexico on April 20, killing eleven workers and opening a seafloor blowout that pumps an estimated 60,000 barrels of oil per day into Caribbean and Gulf waters; despite multiple failed capping attempts, the well remains uncontrolled as this edition is published, representing the largest marine oil spill in US history.
• Greece agrees to a €110 billion emergency loan package from the European Union and the International Monetary Fund in May, the first eurozone bailout, after Athens’ borrowing costs reached crisis levels; austerity conditions attached to the package trigger violent protests in Athens, killing three people at a bank that is firebombed.
• Haiti’s January earthquake recovery enters its fourth month with 1.5 million people still displaced; the international donors’ conference in New York in March pledged $10 billion over three years for reconstruction, but the pace of actual assistance and the Haitian government’s absorptive capacity are both deeply inadequate.
• Kyrgyzstan’s government is overthrown in a violent uprising in April; President Bakiyev flees; an interim government takes power but ethnic violence between Kyrgyz and Uzbek communities in June kills hundreds and displaces hundreds of thousands in the Fergana Valley.
• Israel’s naval commando raid on the Gaza Freedom Flotilla on May 31, killing nine Turkish activists, triggers an international crisis that strains Turkey-Israel relations, prompts UN condemnation and intensifies global scrutiny of the Gaza blockade.
• Afghan presidential elections, NATO strategy reviews and deepening Taliban influence across southern Afghanistan dominate alliance discussions; General Stanley McChrystal is relieved of command after his staff’s incautious remarks to Rolling Stone magazine in June embarrass the Obama administration.

Prologue: Catastrophe and Consequence

The second quarter of 2010 was defined by cascading disasters — geological, industrial and political — whose consequences intersected in ways that will take years to fully trace. Haiti’s earthquake, which had struck in January, had barely begun its recovery; the Deepwater Horizon blowout was pumping oil into the sea at a rate that made it the hemisphere’s most dramatic environmental emergency in decades; Greece’s fiscal crisis threatened the common currency project that underpinned European stability; and the Gaza flotilla incident brought Turkey and Israel, two of the region’s most strategically important states, into direct confrontation. For Jamaica and the Caribbean, the deepest immediate consequence was in Haiti, where the scale of the reconstruction challenge was becoming clear. But the Gulf oil spill carried its own anxieties: the Caribbean’s deep economic dependence on clean coastlines, fishing and tourism made every image of oil-covered Gulf marshes a reminder of regional vulnerability.

Deepwater Horizon and the Caribbean’s Environmental Stakes

The explosion of BP’s Macondo Prospect drilling rig on April 20 was initially treated as an industrial accident of manageable dimensions. It quickly became clear that it was neither manageable nor merely industrial. The blowout preventer at the sea floor failed; the well was at a depth of approximately 1,500 metres, well beyond easy intervention. By early May, the spill had reached the Gulf Coast; by June, oil was coating beaches from Louisiana to Florida. BP’s attempted remedies — the containment dome, the junk shot, the top kill — each failed in turn. A relief well was being drilled but was not expected to intersect the original bore until August.

The spill’s significance for the Caribbean extended beyond ecology. The Gulf of Mexico’s circulation patterns mean that currents carry its waters toward the Caribbean; while the spill remained predominantly in the northern Gulf, the worst-case scenarios being modelled included oil reaching the Florida Straits and the wider Caribbean. Caribbean nations dependent on fishing and marine tourism watched with particular alarm. Jamaica, Trinidad and the smaller eastern Caribbean island economies — whose GDP per capita figures rest heavily on clean beaches and coral reefs — had enormous stakes in how the spill was contained and whether its lesson about offshore drilling governance was absorbed globally.

Haiti: The Scale of Reconstruction

The donors’ conference held in New York in March 2010 raised $10 billion in pledges for Haitian reconstruction, apparently confirming international commitment to a sustained effort. The gap between pledges and disbursements was immediate and stark. Haiti’s government, itself devastated by the earthquake — the Presidential Palace, multiple government ministries and the parliament building were destroyed, and an estimated 18,000 civil servants were killed — had limited capacity to coordinate, receive and deploy international assistance. Non-governmental organisations operated across the country in a semi-coordinated archipelago of relief projects that sometimes overlapped and sometimes left entire communities unserved.

An estimated 1.5 million people remained in spontaneous camps in and around Port-au-Prince as the rainy season began. Sanitation infrastructure in the camps was inadequate. Disease, primarily acute watery diarrhoea and respiratory infections, spread. The Haitian government’s capacity to conduct the planned national elections later in the year was in serious question. CARICOM, with Jamaica’s active participation, was engaged in both diplomatic support for Haiti’s sovereignty and practical coordination of regional assistance; the scale of the task remained beyond the region’s resources alone.

Greece, the Euro and Caribbean Economic Exposure

Greece’s acceptance of its €110 billion bailout in May was a watershed in European monetary history. The European Union had expressly prohibited member-state bailouts in its founding treaties; the Greek rescue required that prohibition to be reinterpreted under financial emergency. Germany’s Chancellor Merkel insisted on strict austerity conditions, including wage cuts, pension reductions and tax increases, as the price of European solidarity. The package was accompanied by the establishment of the European Financial Stability Facility, a broader backstop for other potentially vulnerable eurozone members, chiefly Portugal, Ireland and Spain. Greek civil servants and trade unions struck repeatedly; the Athens bank firebombing that killed three workers on the day of the parliamentary austerity vote was a portent of the political volatility the programme would generate.

The Caribbean’s exposure to the eurozone crisis was indirect but real. European tourism was a primary revenue source for many island economies; a prolonged European recession or a sharp fall in consumer confidence on the continent would translate directly into reduced visitor numbers and lower remittance flows from the Caribbean diaspora in Europe. Jamaica’s economy, navigating its own IMF programme, was tracking European developments with the attention they deserved.

Looking Ahead

BP’s relief well will not intersect the Macondo bore until August at the earliest; the Deepwater Horizon spill remains uncontrolled as this edition is published and the final environmental toll is unknown. Greece’s austerity programme faces a multi-year implementation challenge in a country with a history of structural reform resistance; the eurozone’s stability cannot be regarded as secured by one bailout. Haiti’s rainy season — and with it, the hurricane risk for a country with 1.5 million people in inadequate temporary structures — represents the most urgent Caribbean concern of the coming months. And Afghanistan’s McChrystal episode illustrated the depth of tensions within the NATO alliance over a war whose trajectory is far from clear.

Jamaica Homes Global Conflict & Caribbean Impact Review is published quarterly, examining how wars, geopolitical tensions and major international crises have shaped Jamaica, the Caribbean and their economies.

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