No easy year ahead
If Prime Minister Freundel Stuart was waiting on some kind of meaningful good economic news to help him settle on the date of the next general election he should find another plan.
With just over a week to go before the end of the year, it is now past obvious that Barbadians will not go to the polls in 2012.
But as the new year fast approaches it is equally apparent, some would say even more so, that far from improving the island’s economic difficulties may very well worsen in the coming months.
Stuart himself, and leading spokesmen on such matters, principally Minister of Finance and Economic Affairs, Chris Sinckler, and Central Bank of Barbados Governor, Dr. DeLisle Worrell, have long been insistent that the Barbados is “stable”.
For those of the political ilk like Stuart and Sinckler that has largely meant that Government has not retrenched any of its large civil service, the private sector has generally tried to keep its promise not to lay-off staff, and the vulnerable sections of the society have been protected via an expanded “safety net”.
In other words, they would say, they have focussed on ensuring that whenever good times return there would be a society intact.
Other members of the governing Democratic Labour Party chorus have in their different ways, styles and varying competencies sung a similar tune.
In Worrell’s case he has been more satisfied by the fact that the island has sustained a reasonable amount of foreign exchange reserves, that the Barbados dollar has maintained its exchange rate vis-?†-vis the United States currency, and that while economic growth has been, to use his words, “stagnant”, there has been no decline.
On the other side of the coin has been a number of critics of the way Government has been handling, or in their view mismanaging the Barbados economy ever since it came to office.
Not surprisingly, the critiques have been led by Leader of the Opposition Owen Arthur. Whatever his shortcomings may be, having been a prime minister for 14 years, we think more importantly being an economist of several decades experience and a minister of finance for the same period he was the head of the country, Arthur’s words do hold some weight.
And so he has blamed the current administration for not being able to steer the island out of its difficulties since the recession ended.
As expected, Government members have attributed the Opposition Leader’s statements as calculated and intended to score political points — and in some ways they might have a point.
Unfortunately for Stuart and company, much of the Opposition’s views and concerns are being echoed by others, who certainly cannot be fairly accused of being part of a economic bad news conspiracy with the Barbados Labour Party.
These individuals include economists in Government’s own Economic Affairs Division, the Caribbean Development Bank, and as recent as yesterday, both senior private sector spokesmen and credit rating agency Moody’s.
“Greater growth in tourism and international business receipts along with further dampening in the level of imports, particularly consumer goods are needed,” the Economic Affairs Division said in recent advice.
The CDB’s Director of Economics, Dr. Juliet Melville, stated last week: “At the moment we are not too pessimistic but we are not overly optimistic as to what 2013 and 2014 will bring. The prospect going forward is not as bright as one would hope.”
Trinidad and Tobago, Belize and Guyana were the only bright sparks she mentioned, countries not heavily dependent on tourism and international business and financial services like Barbados.
And just yesterday it was Barbados Chamber of Commerce and Industry President Lalu Vaswani, and Barbados Private Sector Association Chairman, John Williams lowering hopes of a bright 2013, and likely difficulties in shielding the country from job losses.
Soon after Moody’s was downgrading Barbados’ rating to “junk”, citing the island’s “continuing lacklustre economic performance”, and “ongoing deterioration in the government’s debt metrics”.
“While the worst appears to be behind Barbados both in terms of fiscal deficits and economic deterioration, Moody’s anticipates that the government’s deficits will remain large for the next few years and its debt levels will continue to rise, albeit at a slowing pace,” the agency said. It has certainly been a deluge of bad news for the economy in recent days, and unfortunately that is unlikely to be the end of the tale.
The big question now is: what more can Stuart and his team do to improve things?
This is considering that the recovery Barbados seeks is so largely dependent on happenings outside of its control, and which based on all evidence made public so far is no closer to fruition.
What can we as individual Barbadians do to help? Will working a little harder, thereby increasing productivity make that great a difference?
Has it reached the stage where we need outside help? Sadly, the only certain thing it seems that is in store for us in 2013 is more uncertainty.
We do not envy Stuart considering the difficult task that is ahead of him as he seeks another term in office. In the words of William Shakespeare’s Henry IV, Part 11 “uneasy lies the head that wears a crown”.