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DLP Column:PM on the right track
11/22/2009
The recent Standards & Poor’s rating has reassured Barbadians that their investment grade international credit rating is intact. The agency, however, went on to raise some concerns and offered advice as to what we can do to maintain the credit rating. It is typical for an independent body to offer advice to small developing countries during times of economic crises. Former Governor of the Central Bank, Sir Courtney Blackman, in his response to the recent rating comments, stated “… I don’t see the Barbados situation today as dire…” and that we are “… surviving and doing pretty well”. He further suggested that we should continue to manage the process from Bridgetown and not from New York, Washington, London or any other major city.
What is even more critical during these times is that leaders of small developing countries with open economies should have a vision of what needs to be done. PM Thompson is one such person with a vision, and who does not believe that ‘one shoe fits all’ is the approach that needs to be embraced. He has publicly defended his government’s economic strategy while giving a six-month update on the situation in Parliament’s recent sitting.
He pointed to an increase in tourist arrivals out of Canada by some 11 per cent, property taxes had increased by some 12 million dollars and there was evidence of growth in non-sugar and fisheries sectors. In addition, the Government has decided to step up its capital works programme in an effort to bring some relief to the construction sector. We are cognisant of the role the sector has played in the economy. Our construction sector has felt the fallout as unemployment, now at 9.9 per cent, is mainly attributed to the slowdown in construction. The government has targeted this sector as a crucial area for attention and is responding accordingly. The PM has also indicated an intention to further strengthen our efforts in marketing the tourist industry, which still continues to respond relatively positive under the circumstances.
The Prime Minister has stated that it would not be prudent to engage in a fiscal stimulus package as it would have “negative side effects”, since 76 cents out of every dollar would be spent on imports. In essence, we would be depleting our resources. He cautioned Barbadians to wait and see. In Jamaica, it was recently reported by Prime Minister Bruce Golding that over 40 000 persons have lost their jobs since the global recession. The fallout from the bauxite industry was the main contributor to this job loss. Countries throughout the region are lining up to meet with the International Monetary Fund. Our country has not undergone the shock that other countries have experienced. This is as a direct result of the fiscal prudence that has defined the response.
Prime Minister Thompson further warned that it was possible, due to uncertainty, that international economies could themselves decline and fall into a “double-dip recovery”. Thousands of miles away, a leader with well over 300 million people to oversee, has recently raised a similar concern regarding his country’s economic outlook. President Barack Obama, while speaking in Beijing, indicted that he too was worried about “spending too much money to help revive the economy” as it could “undermine a fragile US recovery and throw the economy into a double-dip recession”.
There can be no doubt that the notion of reckless spending and a runaway fiscal deficit will not become buzz-words of this Government. We are pressing hard to bring some balance to the economic development agenda while placing people at the centre. We can therefore see no real connect in the Opposition Leader’s call for the deferral of Constituency Councils. These Councils represent an attempt to pay the special attention to the build-up of the needed social capital as an additive to the economic development agenda. While we are seeking to twin our approach, once again the Opposition is out to sea as it relates to the need for a paradigm shift in addressing the current melt down. Barbadians can rest assured that we will continue to build a society and not just an economy.
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