BUSINESS MONDAY: GROWTH, JOB CREATION VITAL

AS Barbados goes about trying to restore economic growth, that growth must be accompanied by job creation.

So says Governor of the Central Bank of Barbados, Cleviston Haynes, while commenting on the significance of the country earning foreign exchange so as to maintain the existing peg with the United States dollar.

He said that Barbados tends to collaborate with potential foreign investors, telling them what the island has to offer.

To the extent the country is able to attract foreign investments, it brings in foreign exchange, stimulates construction activity and leads to the creation of jobs.

“So at the end of the day, what we want to see are jobs and growth,” the Governor remarked.

Haynes said Barbados needs to build a buffer of foreign exchange reserves which, apart from investments, can also be done through such sectors as tourism, international business, manufacturing, agriculture, and services offered by producers earned overseas.

The Governor said that to the extent the country is able to build that buffer of reserves, it would be in a better position to finance the acquisition of goods which are costing more, and to reduce the level of borrowing.

The Central Bank’s top economist remarked that competitiveness is also vital in that push to acquire more foreign exchange.

Noting that Barbados is in a world where all countries are competing, we have to make sure that while price competitiveness is important, the quality of services must also be significant.

“If we are losing reserves, we have an obligation to advise government on what we are seeing and advise the approach to deal with the situation,” he stated.

The Bank’s advice to government, based on the context of the situation, is that it can borrow a little as well as adjust fiscal policy.