Better planning urged

TOO many businesses in Barbados and across the Caribbean continue to fail because of a lack of proper planning. This position was outlined yesterday by Minister of Industry, International Business, Commerce and Small Business Development, Donville Inniss.

Speaking at the launch of a grant financing facility sponsored by Caribbean Export Development Agency (CEDA), Inniss said that the businesses were failing at the level of the first generation because they have failed to plan, and to embrace those outside their narrow organisational structure to get the best possible advice.

“When they start to fail they come to us politicians asking for more money. We do that sometimes and then we have to apologise at election time,” he pointed out.
Stating that this cycle can no longer continue, the Minister called for more export oriented businesses, while acknowledging that his Ministry remains committed to maintaining its support for advancing the plight of the business class. “We stand ready to support any initiative to do so,” he remarked.

The financing initiative known as the Direct Assistance Grant Scheme (DAGS) is being managed by the Caribbean Export Development Agency made available through the 11th EDF, a funding package which the European Union makes available to the CARIFORUM countries.

The Minister said that the type of creative financing proffered is therefore largely in sync with the tenets of Barbados’ wider policy framework for MSME development enunciated in February of 2017. This MSME policy framework like that of the regional offering has identified the need to create a suitable institutional and regulatory framework to encourage donors and financial service providers to introduce innovative financial products and services that will lead to greater financial inclusion among “unbanked” and “under-banked” MSMEs.

Inniss pointed out that we cannot and must not ignore the fact that the current risk mitigation framework to improve access to finance by MSMEs needs to be urgently strengthened.

As an example, he went on, it is important that our risk mitigation strategies include the feasibility of exploring Loan Default Insurance to encourage more creditors to enter the market to provide MSME financing.

“Similarly, I am of the view that as strategic business and business facilitation partners we must urgently collaborate to create a Collateral Registry that will allow borrowers to register the collateral they are pledging against loans so as to inhibit borrowers from pledging the same asset to different lenders without the lender’s knowledge,” according to him.