BUSINESS MONDAY: SOUND GROWTH STRATEGY NEEDED

THERE is still a lot of work to be done in repositioning the Barbados economy. Furthermore, there has to be a sound growth strategy to assist in boosting the economy to achieve the debt-to-GDP target of 60 per cent by 2036.

These are part of an assessment of the economy as highlighted by Analyst Bruce Hennis, following the recent second quarter review by the Central Bank of Barbados.

He has told Business Monday that the reality from the report issued by the Bank’s Governor, Cleviston Haynes, showed that the economy at June 2021 stood at a level equivalent to $914 million or 23 per cent lower than the amount for June 2019.

“In other words, there is still much work to be done,” he stated.

Hennis analysed the two components of the economy – the internal and the external, and how the fall affected the impact of foreign exchange flows.

According to him, in June 2019 inflows from the tourism industry as measured by travel, amounted to $1.4 billion. For the just ended 2021 half year, tourism inflows reached $0.2 billion, even less than the $0.8 billion recorded in the first half of 2020.

“Thus for the first half of 2021, there has been a notably significant drop of $1.2 billion in foreign exchange inflows from tourism, a sector that accounted for close to half of all inflows during 2019,” he noted.

As for debt, which is to be brought down to 60 per cent of GDP by 2036, Hennis said the next 15 years will be no sure thing.

As such, he cautioned that tourism has to make a comeback, and there is a strong possibility of further economic crises occurring.

“A sound growth strategy is still required to assist in boosting the economy to meet the debt-to-GDP target,” he added.