Stuart insists Govt managing foreign exchange reserves
Prime Minister Freundel Stuart has given assurances that Government is managing the island’s foreign exchange reserves.
The matter featured prominently during this week’s debate on the 2016 Financial Statement and Budgetary Proposals presented by Minister of Finance Chris Sinckler.
Addressing Parliament last night, Stuart acknowledged that this was an issue that any small open economy would be concerned about, but he said his administration was taking steps to safeguard the country from risk.
“Every minister of finance has to have regard to the exchange rate policy tool that he has at his disposal where, if our outflows of foreign exchange are chronically outdistancing our inflows of foreign exchange … leading to a chronic disequilibrium in the balance of payments, the minister of finance has to step in, and Government has to step in and deal with that situation. And that is what this Government is doing.
“We don’t want to get to the stage where we have to change any exchange rate for the purpose of making imports more expensive and exports cheaper to deal with our foreign reserve problems. That is not an agenda item for the present Government, but we are managing our foreign exchange situation and our foreign reserves with maturity and with vigilance so that Barbados is insulated from those risks,” Stuart said.
He also addressed concerns raised by the private sector over the implementation of measures announced by the Minister of Finance.
“I do not underestimate the importance of the points being made about making sure that these measures are implemented and implemented in good time, and I as Prime Minister will make sure that these measures are implemented, that all the necessary mechanisms are put in place,” Stuart stated.
The Prime Minister described the current economic situation as “perhaps the most difficult period in Barbados’ post-independence economic history”, and told the Lower House that unlike other budgets, there was “no substantial objection” from the opposition, “and therefore there is really nothing to defend as such”.
However, he accused Opposition leader Mia Mottley of practicing “scratch grain politics” after she criticized some of the measures and dismissed the budget as a “piecemeal patchwork… set of initiatives” designed to serve the interest of the Democratic Labour Party.