Mottley reacts to latest Central Bank report
Opposition Leader Mia Mottley is questioning figures released yesterday by the Central Bank of Barbados which indicate that the economy registered growth in the first quarter of this year and is on track to record overall growth in 2016.
The news delivered by Central Bank Governor Dr DeLisle Worrell came on the same day that Mottley led off debate on a vote of no-confidence against the Freundel Stuart administration, based on its shandling of the economy, among other issues.
According to the Central Bank’s first quarter review, the economy expanded on the back of another strong winter tourist season, with growth for 2016 expected to be 1.6 per cent.
“They are going to trumpet here that the economy expanded by 1.7 per cent. Let’s do the heavy lifting – Central Bank printing more money, foreign reserves down from first quarter last year, expenditure up. The indices are not reading right,” Mottley said.
To support her argument, the Opposition Leader said the administration had the unenviable distinction of running a current account deficit every single year since being voted into office in 2008.
She added that despite the measures implemented in the last Budget, foreign reserves had declined, standing at $940.3 million after the first three months of this year, compared to $1.1 billion for the same period last year.
The Barbados Labour Party (BLP) leader also warned about the National Insurance Scheme (NIS) holding billions in Government paper – $3.228 billion in 2015, up from $1.4 billion in 2007 – and the printing of money by the Central Bank to fund Government spending.
She pointed out that the latest Central Bank report showed the latter amount was increasing even further. Mottley said that printing of money had been a major concern for the International Monetary Fund (IMF) and was outlined in the financial institution’s report following its Article IV Consultation in 2015.
“They say in straight terms, Mr Speaker, cease . . . Central Bank financing of the Government. But instead, today, this morning, the Central Bank of Barbados releases a report showing that the first three months of the year it printed another $56 million,” she told the House.
“This activity puts us at risk, puts our dollar, our exchange rate, at risk,” Mottley further warned.
Government’s interest payments, she added, had almost doubled between 2007 and 2015/2016.
“We have an economy in Barbados today that is nominally smaller than in 2007,” she said. “This Government’s experience as a Government has been effectively to preside over no growth or negligible growth.”