For the love of sanity and transparency
At a time when there is daily debate on possible remedies to fix the ailing economy, yesterday’s tempting proposal tabled by British investors Andrew Stewart and Stuart Fordham has no doubt created a stir –– raising eyebrows in some quarters, and in others quiet anticipation.
There’s hardly ever an occasion when those who choose our shores to operate various business ventures publicly share their views on the state of the island’s affairs, far less offer to put their wealth and reputation on the line to assist. Therefore, the bold initiative from the millionaires provides a major boost, especially in a climate where investor confidence appears to be at its lowest.
Mr Stewart, the founder of Ravensroft Limited, and his partner Mr Fordham, as securities exchange expert, are seeking the green light to secure between US$950 million and US$1 billion in a sovereign bond issue. They insist there is no need for the island to make that dreaded trip to the Washington-based International Monetary Fund, and instead said they are prepared to draw on their wealthy connections to raise the bond issue.
Said Mr Stewart: “What we are saying is that we and our infrastructure and our worldwide banking relationships feel . . . this country can go and tap substantial resources throughout the world.”
An alluring offer, no doubt; but, no matter the temptation, wisdom and level heads must always prevail. Interestingly, the businessmen have already started negotiations with the Government, and meet they should. But the proverb all that glitters is not gold is pertinent advice, especially at a time when we are eager to escape the economic pressure that has seen little or no relief for more than three years now.
For sure, Barbadians had a taste of the pain of their counterparts in Antigua and Barbuda who suffered the brunt of the Allen Stanford fiasco. A painful lesson it was for thousands whose dreams crashed as the billionaire’s empire came to an embarrassing end.
In no way are we imputing ill motive to or questioning the integrity of the successful Mr Stewart who already has several tourism-related investments on the island. We are merely recommending that the powers that be dot all the i’s and cross all the t’s –– to spare an already weary country any more remotely possible economic suffering.
The proposal, though an enticing alternative, raises a number of questions. One may wonder why Messers Stewart and Fordham are willing put their all on the line to back Barbados. While we collectively beam at Mr Stuart’s view that our island “is not just one of the best islands . . . . It is the Rolls Royce of the Caribbean”, we can’t help but ask what’s in it for the two. Who will benefit more from the deal in the end?
Secondly, didn’t the Freundel Stuart administration pull back a US$500 million ten-year bond issue intended to buy back existing debt and finance the Budget in September last year? Since then, after suffering harsh downgrades from international ratings agencies Moody’s and Standard & Poor’s, could our bonds be any more attractive?
Thirdly, if we agreed to take up the offered arrangement wouldn’t it translate into more debt, which economic experts have cautioned the Government to avoid at all costs, if the island is to return to stability?
Now is the time for our best and brightest economists to speak up and independently offer sound advice that would keep this island from sinking farther into this economic hole. By no means are we suggesting that the proposal be offhandedly discarded. We are simply urging that the powers that be engage in frank, honest and transparent negotiations to ensure Barbados gets what is best suited to its needs.
Fourthly, are the British business executives prepared to put forward any other alternatives? Perhaps the Minister of Finance should impress upon the two, who love Barbados so dearly, to consider investing in a new project to help stimulate activity, provide much needed jobs, and restore the economic growth we so desperately long for.