Economy worse off, says Opposition spokesman
Economist Clyde Mascoll has described the Government’s handling of the economy as very poor, following the latest Central Bank of Barbados release on the island’s economic performance.
He gave the Freundel Stuart administration a failing grade, saying the ongoing recession in the Barbados economy continued to be poorly managed.
“Notwithstanding that the fiscal adjustment package was to provide a platform for the restoration of economic growth, reversal of the fiscal crisis and stalling of foreign reserves losses, the evidence from the most recent economic review suggests otherwise,” said Mascoll.
While the Central Bank has reported that the unemployment figure for 2013 was 11.7 per cent, Mascoll said recent private sector job losses, accompanied by the layoffs of the almost 3,000 public servants was not yet reflected in the figures, which he contended was at 13.2 per cent at the end of last year.
Mascoll said: “The fiscal position is the worst of all times, including the low points of the current administration.
“It ought to surprise no one that the Government collected $245 million less in revenue for the fiscal year ending March 2014, since the figure was always unrealistic given the lack of performance in the economy. Simply increasing the tax rates or even introducing new taxes will not get the job done in a depressed economy.
“Notwithstanding that the Government borrowed some $450 million over the last five months, the foreign reserves ‘remained on par with year-end 2013 levels’. This suggests that there was a loss in reserves in the absence of the borrowing. The continued underperformance of the tourism sector and the sluggish inflow of foreign capital mirror the performance of the reserves.
“The latter also mirrors lack of confidence,” said the economist.
He added that when measured by “every important indicator” the Barbados economy was “worse off” and so were local workers and businesses, compared to previous years.
“In a world that has emerged from a recession since 2010, it is appalling that Barbados remains the only Caribbean economy officially in recession,” added Mascoll.
“In the midst of further economic decline, rising unemployment and growing debt, Barbadian can anticipate paying more taxes while earning less income. This is poor management. Unfortunately, the Minister of Finance recently stated that if the fiscal adjustment does not work, then devaluation is the alternative. What a discomfort!” he said.