Cameco tax case is scary for Barbados!

How a Canadian company avoided 1.4 billion in taxes by using an offshore subsidiary and what it means for Barbados

by Not Taken

Yet another interesting and scary for Barbados article in the business section of a major Canadian newspaper, The Globe and Mail: Cameco’s $800-million tax battle

I have been sending these recent articles as a public service so the Ministry of Finance and the Barbados Central Bank Governor have a heads up on the attack on Canadian tax evaders/avoiders that is undoubtedly about to hit the Barbados offshore industry; if in fact it has not already hit – but unreported.

This is very bad news for Barbados revenue sources.

While the Cameco case involves its Swiss subsidiary, it is probably just the tip of the iceberg in CRA’s efforts to collect taxes due to Canada. There must be hundreds, if not thousands, of  “Canadaco (Barbados) Limited” businesses doing the same same transfer pricing schemes (scams) in order to pay 2% income tax to Barbados, rather than 27% to Canada.

Even those Canadian companies not not already being audited for this this type of tax “management” may decide for close up shop in Barbados to avoid the publicity that a CRA audit will bring.

Cameco’s CFO, retorts that Cameco Europe has its own board of directors and a full-time CEO, Gerhard Glattes, who has no other duties with the company. Cameco Europe provides Cameco with compensation for the management duties – like legal advice – it does not have its own staff for. “It was established in accordance with all relevant laws and regulations when it was set up.”

The Barbados registered Canadaco subsidiaries’ own boards of directors and full-time CEOs who have no other duties with the Canadian company should start planning for alternative sources of income. And of course it will have serious implications for the Barbados services providers; the legal community,  the management/bookkeeping companies, and the accountants when it happens.

Barbados Economic Performance – 2013 First Quarter

“Growth in tourism has not be sustained this year”

• 11.6% unemployment in 2012
• VAT receipts down 7%
• Income tax receipts down 18%

I need a rum!

Hard times coming to Bim. Are you ready?

“Booming Bim? Here is the current state of affairs at the Almond Hotel. We were there last week and it’s not pretty.”

… an old friend sends a photo to BFP (click on photo for large)

How many people do you know still waiting for VAT and tax refunds? If you’re like us, you know plenty. The government doan have much money these days.

How many people do you know who were laid off in the last year and haven’t managed to find another real job? Answer: lots and lots.

How many hotels and businesses gone or just hanging on? How many shops in the city are understaffed because they laid off the newbies when the “high season” tanked this January?

Been to the Gap lately? You could have Jamaican gang shootouts on the street and not hurt a soul. Maybe we should rent the place out for that purpose… at least then there would be something happening at the Gap!

And let’s not get started about how many airline seats we lost in the last year with Dallas Fort-Worth, Atlanta. Let’s not talk about CLICO, the downgrades or raiding our NIS pensions to “invest” in doomed hotel projects.

We’ve said it before, and we’ll keep saying it…

1/ Shun debt. Shun expenses. Live as frugally as you can.

2/ Work hard, save what you can.

3/ Look after family and friends as you are able because you might need their help someday.

4/ Learn to grow food, repair your own car, maintain your own home. Repair clothes, repair everything. Don’t buy new anything: let some other fool pay the depreciation!

5/ Smile at the tourists, make them feel welcome but never pressured. Pick up the rubbish where you can and never do anything that takes away from the beauty of Bim.

6/ Thank God for what you do have – then get back to working harder than you ever have before.

We can do this, folks. But it can’t be business as usual.

Barbados yogurt production ends – exposing more hollow government rhetoric

“Whenever practical, buy local.”

by Adrian Loveridge, small hotel owner

When we moved to Barbados almost 25 years ago and  purchased what was a semi-derelict Arawak Inn and beginning our journey in hotel operation, as non-nationals, not surprisingly, only a handful of suppliers would extend us credit. We have remained fiercely loyal and faithful to that small group.

So when PineHill made its entirely unilateral decision to stop producing yogurts it went entirely in the face of a policy we implemented when Peach and Quiet opened: “Whenever practical, buy local.”

“It is almost incomprehensible that this decision by PineHill was made at a time when our struggling dairy industry is trying to survive in the wake of a massive unsold milk glut.”

One or two people have indicated that PineHill did in fact issue a public notice in the media to the effect that they would no longer be manufacturing yogurts. But wouldn’t you, as a matter of course, write to customers that have traded with you for two decades?

After all, we have never been to busy to write and sign, literally hundreds of cheques to them over that period. It almost reeks of arrogance and indifference on their part.

So what do the 160 or so registered hotels, hundreds of villas, apartments and condominiums do now?

In our own case we have been forced to purchase imported yogurts from a distributor, who bring in the French brand, Yoplait. While the individual containers do not show a country of origin, the packaging does and indicates that they are made at their US subsidiary in Minneapolis. So at a critical time, when we are trying to retain every cent of foreign earnings, here we are importing an item that has a long history of local production, that is being trucked and shipped by refrigerated transport over a distance of at least 6,000 miles.

Just think about the carbon footprint for a minute.

Surely the company has to publicly explain why they have chosen this time to cease production and why it is no longer viable? With over 500,000 long stay visitors annually plus sales to locals, cruise ship companies and inflight caterers, what is the problem?

Another point that should be raised, are the recognised health benefits associated with yogurts and would it not be in the national interest to encourage more consumption. Foreign alternatives almost certainly will be more expensive and in these challenging times that alone will stifle demand.

I was also surprised that yogurt attracted 17.5 per cent VAT, as it surely could not be considered a luxury food item, but more a weapon against obesity and digestive disorders. Back on 13th January 2011 under a large attention grabbing Nation News banner headline ‘Bigger Basket’, the then Minister of Trade stated that more VAT exempt items would be added to the ‘basket’. Once again, this appears to be only just more rhetoric.

I really hope that PineHill will re-consider their decision or alternatively take steps to relinquish their near monopoly of milk processing, by giving another manufacturer a chance in Barbados.

The Line in the Sand…

With rights there are responsibilities and while yogurt may seem to some as an insignificant part of the bigger picture, but to me, it’s the line in the sand.

After yogurt, what comes next?

Will PineHill then transfer milk production to Trinidad, because due to energy costs, its cheaper to boil the liquid there?

Wuhloss! Barbados now paying 6% to borrow money.

With United States Treasury Bond yields averaging below 2% over the last 10 years and at record lows, the Central Bank of Barbados is forced to pay 6% on a new $65,000,000 Treasury Note issue. You get the feeling that Central Bank Governor Delisle Worrell is backed into a corner with his list of viable options evaporating in his hand. (Thanks to Barbados Today for the photo)

I really don’t know much about these things – but I do know this: When Barbados is forced to pay three times the going rate to borrow money, we have a problem somewhere…

Central Bank of Barbados : ISSUE OF $65,000,000 BARBADOS GOVERNMENT 6% TREASURY NOTE 2018

General Press Release ISSUE OF $65,000,000 BARBADOS GOVERNMENT 6% TREASURY NOTE 2018
01/29/2013

ISSUE OF $65,000,000 BARBADOS GOVERNMENT 6% TREASURY NOTE 2018

Applications are invited on January 31, 2013 for subscription to this Treasury Note opening on February 01, 2013.  The Treasury Note will be issued at par with a fixed interest rate of 6%payable on January 31and July 31 of each year.  The interest due to Pensioners 60 years and over residing in Barbados will not be subject to withholding tax.

Barbados not immune from the coming storm

The Greek experience: terrifying for ordinary people

Can you feel it? Can you see how Europe’s troubles will touch Barbados in a big way?

It doesn’t take a fortune teller to predict the future in Barbados and the rest of the Caribbean. We’ve counted on tourism and offshore banking and excluded manufacturing and hi-tech industries and services. Agriculture is in ruins with sugar a liability not an asset to the economy. We have failed as a region and as a country to embrace energy creation and conserving technologies to any meaningful extent.

Our leaders counted on the same old same old ability to sell our version of the sun, sea and sand that everyone else is pushing at much lower prices. Our tourism plant is old and many of the new projects are stalled or dead in this economy. We have no savings. We spent everything and more during the good years. Our leaders for the last 15 years are bailing out for Canada, Europe and the USA and taking their families with them. In most cases the children have already been educated over and away.

So what can the ordinary folk do? We’ve said it time and time again:

1/ Shun debt. Shun expenses. Live as frugally as you can.

2/ Work hard, save what you can.

3/ Look after family and friends as you are able because you might need their help someday.

4/ Learn to grow food, repair your own car, maintain your home.

It’s coming folks. Can you feel it?

20 Facts About The Collapse Of Europe That Everyone Should Know

Submitted by Tyler Durden

The economic implosion of Europe is accelerating. Even while the mainstream media continues to proclaim that the financial crisis in Europe has been “averted”, the economic statistics that are coming out of Europe just continue to get worse.

Manufacturing activity in Europe has been contracting month after month, the unemployment rate in the eurozone has hit yet another brand new record high, and the official unemployment rates in both Greece and Spain are now much higher than the peak unemployment rate in the United States during the Great Depression of the 1930s. The economic situation in Europe is far worse than it was a year ago, and it is going to continue to get worse as austerity continues to take a huge toll on the economies of the eurozone.

It would be hard to understate how bad things have gotten – particularly in southern Europe. The truth is that most of southern Europe is experiencing a full-blown economic depression right now. Sadly, most Americans are paying very little attention to what is going on across the Atlantic. But they should be watching, because this is what happens when nations accumulate too much debt. The United States has the biggest debt burden of all, and eventually what is happening over in Spain, France, Italy, Portugal and Greece is going to happen over here as well.

The following are 20 facts about the collapse of Europe that everyone should know…

1. 10 Months: Manufacturing activity in both France and Germany has contracted for 10 months in a row.
2. 11.8 Percent: The unemployment rate in the eurozone has now risen to 11.8 percent – a brand new all-time high.
3. 17 Months: In November, Italy experienced the sharpest decline in retail sales that it had experienced in 17 months.
4. 20 Months: Manufacturing activity in Spain has contracted for 20 months in a row.
5. 20 Percent: It is estimated that bad loans now make up approximately 20 percent of all domestic loans in the Greek banking system at this point.
6. 22 Percent: A whopping 22 percent of the entire population of Ireland lives in jobless households.
7. 26 Percent: The unemployment rate in Greece is now 26 percent. A year ago it was only 18.9 percent.
8. 26.6 Percent: The unemployment rate in Spain has risen to an astounding 26.6 percent.
9. 27.0 Percent: The unemployment rate for workers under the age of 25 in Cyprus. Back in 2008, this number was well below 10 percent.
10. 28 Percent: Sales of French-made vehicles in November were down 28 percent compared to a year earlier.

Cost-U-Less will destroy local businesses, and Cost YOU More…

“We created more bribes to get investors to develop infrastructure to attract tourists to our region.  We gave them incentives  because tourism as an import industry brought visitors with blenders to spend in our countries and people were employed to provide services to these guests. 

We have ignored the fact that much of the revenues for accommodation never ever reaches our shores yet we offer subsidies on everything from shrimp to alcoholic beverages.”

Cost-Us-More!!!

by Baba Elombe Mottley

Warehouse chain Cost-U-Less is in line for major concessions when it opens in Barbados in the New Year. But while Minister of Finance Chris Sinckler sees nothing unusual about the concessions, Opposition Leader Owen Arthur is calling them “extraordinary and outrageous” and likely to give the store an unfair advantage over similar businesses in the distributive retail sector.

Showing an April 13, 2011 letter from the Ministry of Finance and Economic Affairs which he said he obtained Friday, Arthur said the document, which was copied to the Comptroller of Customs and Commissioner of Inland Revenue among others, listed exemptions from import duty and Value Added Tax (VAT) on the importation of fittings, furniture, fixtures, equipment, construction material and supplies “for use exclusively in connection with the construction, development, sale and operation of the project”.

It also listed import duty and VAT exemption on personal and household effects and vehicles of specialist expatriate staff, as well as exemption for 15 years from the payment of withholding tax on dividends and interest to shareholders, financial institutions and individuals making loans to the company.

- By Ricky Jordan, Sunday Sun, Barbados

All across the English speaking Caribbean, there is an ominous movement of sorts, a movement of low frequency rumblings without patterns, without form, not like the rhythms of bumbatuk or soca or the one drop of reggae or mento that we are accustomed to.

The essence of all of these known rhythms is that they link us to a past of chattel servitude where there was little choice for self fulfillment.  In time these rhythms. isolated as they were in tenantries and yards and the dancehall, fortified our resolve towards freedom and independence.

Over the last 40 to 50 years, we built indigenous institutions in every sphere, oblivious to the rumblings that were moving across the region. We dismantled the psychological prison of plantation inheritance, killed off the skills we developed to feed and clothe ourselves while we were taught to assemble products that we never used.  We set a precedent by bribing investors that our labour was cheap and responsive to training and we told ourselves we could depend on these jobs.

We created more bribes to get investors  to develop infrastructure to attract tourists to our region.  We gave them incentives  because tourism as an import industry brought visitors with blenders to spend in our countries and people were employed to provide services to these guests.  We have ignored the fact that much of the revenues for accommodation never ever reaches our shores yet we offer subsidies on everything from shrimp to alcoholic beverages.

We’ve arrived! Moody’s cuts Barbados to junk status.

Notin’ much more ta say ’bout dis ya know…

Moody’s Investors Service on Thursday downgraded Barbados’ credit rating to Ba1, into junk territory, citing the Caribbean country’s lukewarm economy and rising government debt levels.

The rating also carries a negative outlook, with the agency saying that the country’s economic prospects remain weak.

“Moody’s believes that the country’s growth prospects remain very limited due to its deteriorating competitiveness and declining productivity coupled with heavy dependence on tourism, particularly from the United Kingdom and the United States,” Moody’s said in a statement.

“While the worst appears to be behind Barbados both in terms of fiscal deficits and economic deterioration, Moody’s anticipates that the government’s deficits will remain large for the next few years and its debt levels will continue to rise, albeit at a slowing pace,” the statement added.

Standard & Poor’s rates Barbados BB-plus with a stable outlook, also a speculative rating.

Reuters: Moody’s cuts Barbados rating to junk, could cut more

International Monetary Fund presses Barbados to devalue the Barbados dollar

Devaluation: How would it impact me?

“To most of us in the Caribbean, it does not seem rational to impoverish yourself to grow your economy. To us, it is obvious that is what devaluation implies. The point is not so obvious to Americans and Europeans.”

… Dr. DeLisle Worrell, Governor of the Central Bank of Barbados

We’ve been saying for several years that things are not getting better, and that the future on Bim isn’t pretty. The best and brightest of our young people regularly pack their bags for the USA and the UK if they are at all able – and who can blame them?

Want to know what the future will bring? Have a look at what your Members of Parliament are doing. Duguid is headed for Canada. Donville Inniss family maintains property, business and finances in the USA. Those gentlemen aren’t stupid, you know.

Bajans have been living high – way too high for our productivity. That’s true for us as individuals and it’s true for the country. Now those chickens are coming home, and they are some thin chickens.

An interesting press release by the Central Bank of Barbados that we haven’t seen in any of the local papers. Did we miss it?

It seems obvious that Bim is now under some pressure from the IMF and others to devalue our dollar that is currently pegged to the US dollar at two for one.

Should we devalue? What does that mean for me? What does that mean for my children?

“What good will devaluation do if we don’t address the lack of productivity, the degrading tourism environment and the prevalence of corruption in public service?”

Sometimes there isn’t an easy way out…

Central Bank of Barbados : Press Statement

10/29/2012



The issue discussed at the breakfast meeting with the Managing Director of the International Monetary Fund and the President of the World Bank was whether devaluation was beneficial for small economies. Madame Lagarde was of the opinion that a devaluation of the Barbados dollar would make our tourism more competitive and help our economy to grow. To most of us in the Caribbean, it does not seem rational to impoverish yourself to grow your economy.

Barbados applies for new IDB loan to make payments on previous borrowing

Like a speed addict looking for another fix…

(Submitted by Mac and Clambake)

According to a Nation article, our government has applied for yet another loan from the Inter-American Development Bank to “Shore up its finances”.

Let me put that into simple English for you: We can’t make our current expenses, including payments for previous borrowing, so we’ve borrowed more to make everything better. Better for only a while, that is.

“If I ran my family’s finances like politicians run Bim, we’d be out on the street“

Anyone who’s ever taken a cash advance from one credit card to make a minimum payment on another credit card is quite familiar with what’s going on here. The only difference is the bank doesn’t allow you to indebt the next five generations and their futures for your credit card payment. The IDB and the big countries love it when Barbados does this because the more we owe the more we can be controlled.

US$377.1 million from the IDB in the past 5 years.

Who owns our Barbados? How much do we really owe? Does anyone really know?

How are we going to repay all this money? When will we start?

Get yourself over to the IDB Barbados page and you’ll see this little pie chart that tells the sad tale. In the last five years alone, Barbados has borrowed from the IDB some US$377.1 million dollars and I challenge anyone to account for what ‘we’ did with it.

Barbados borrowing from the Inter-American Development Bank

US$377.1 million for the past five years only…

Doesn’t include the recent $66 million dollar application…

Agriculture and Rural Development  US$20.5 million

Energy    US$142 million

Environment and Natural Disasters    US$30 million

Tourism    US$55 million

Urban Development and Housing    US$30.2 million

Others     US$99.4 million

Further Reading

IDB loan in works

BY TONY BEST | FRI, OCTOBER 05, 2012

Barbados has applied to the Inter-American Development Bank for a BDS$66 million loan to shore up its finances.

Say nice things about the European Union: EU gives Barbados hundreds of millions of dollars in free money!

Is this really about Slavery Reparations?

I really haven’t figured out why the bankrupt European Union keeps giving Barbados hundreds of millions of dollars in grants, forgivable loans and other free money. It’s so frequent that the EU has a standard press release wording that they just drop the amount and the reasons into – complete with the standard quote from the Charge d’Affaires of the European Union Delegation to Barbados and the Eastern Caribbean: “This clearly demonstrates the continued commitment by the European Union to supporting Barbados, especially in these difficult times of a sustained global financial and economic crisis…”

Go ahead, Google that phrase and you’ll see what I mean!

Nor have I figured out what our leaders do with all that free money. Remember when former Prime Minister Owen Arthur balked when the European Union wanted proof of what we did with the sugar money from the EU?

Why does the EU keep giving us money, and why won’t our leaders account for what they do with the money to either the EU or the citizens?

As Father Dubin used to say, “It’s a mystery my son.”

Further Reading

Here’s the latest EU Press Release as found in the Anguilla News…

Prime Minister Thompson said supporting Four Seasons could be “extremely risky” to the DLP Government

How much public money is exposed in the Four Seasons project?

In the year 2012 under the DLP government of Freundel Stuart, Bajans aren’t quite sure how much public money is ‘invested’ or ‘guaranteed’ towards the Four Seasons Resort project.

Is it US$52 million through the IADB loan that is guaranteed, and another US$60 million in National Insurance Scheme cash? Or is that the other way around? Or something altogether different? And what about infrastructure guarantees and construction costs coming from the taxpayers? We’ve heard so many different versions from government and the news media that we don’t think anyone in government or media can provide a definitive answer.

We at BFP think that the Four Seasons project support is out of control with the amount unknown – that the government will not, cannot, provide a comprehensive and accurate answer about how much Bajans are invested and exposed.

Today we found this old article in some old notes we made back in February 2010 while David Thompson was our Prime Minister.

PM Thompson’s comments at the time make for interesting reading. Perhaps our accidental PM Freundel Stuart should read them too…

“Now of course the first objective is not for Government to give guarantees to projects of this type. So the Government is not available, generally speaking, for that kind of thing and I want to make that abundantly clear. It is extremely risky. It has brought down Governments in other countries and I don’t intend to let it bring down my government. And it can sometimes smack of an element of favouritism and once you start it, it becomes like a rolling stone that will gather moss…and therefore, we have to be very careful,”

February 2, 2010 – Prime Minister David Thompson in the Barbados Advocate article PM defends stance on Four Seasons

Further Reading

Are we ever happy that we preserved a copy of the Barbados Advocate from February of 2010, because the BA’s online version of the article seems to have disappeared! What a surprise!

Maybe some of our readers are better searchers than we are, so if anyone finds it let us know the link and we’ll include it.

Meanwhile, here is our copy:

PM defends stance on Four Seasons

2/2/2010

By Regina Selman Moore

Government could not sit idly by and watch a player of the size and significance of the Four Seasons Resort, pack up and move away from Barbados.This was just one of the reasons why the present Democratic Labour Party administration intervened to lend its support to restart the stalled multi-million dollar Four Seasons Resort project.

University of the West Indies: “It was Al all the time…”

They used to tell me I was building a dream…

From the Nation article Pay Talk…

DESPITE THE ECONOMIC CHALLENGES facing the country, the Congress of Trade Unions and Staff Associations of Barbados (CTUSAB) will soon be seeking a pay increase for public workers.

Its president Cedric Murrell announced this yesterday during the 71st annual delegates conference of the Barbados Workers’ Union at Solidarity House in Harmony Hall, St Michael…

From the Nation article UWI Unease…

Hundreds of Barbadians offered a place at the Cave Hill Campus of the University of the West Indies (UWI) are facing the prospects of having that offer rescinded in the wake of dire financial developments at the university, which senior sources there describe as “the campus’ worst nightmare”.

According to the top level sources, who only spoke on condition of anonymity, the jobs of hundreds of employees at the campus might also be in jeopardy after Government’s level of indebtedness to the institution rose to over $150 million recently and campus officials were told the debt would be settled through a four-year repayment plan of $40 million annually, starting in July next year.

DLP – BLP legacy? “Twenty years ago we had everything going for us and we blew it.”

Graeme Hall Watershed: DLP government voted to develop the last green space between airport and the city

After we’ve sold all the land, what’s left?

by Peltdownman

Look, it’s like this. Over the past 15 years, Barbados’ so-called prosperity has been based solely on our selling of land to foreigners, and looking after other people’s money.

Barbados is a “do-nothing” country. The level of inertia in both government and the public service is staggering. The country is dominated by party politics, which itself has nothing to do with the betterment of ordinary citizens, but is based on who can pocket the most out of what is available. The list of matters on which no action has been taken by either party when in government is endless, and it cannot only be put down to indolence. It has to be because vested interests are at stake. I would be happy for someone to give me another explanation.

“PRIME MINISTER OWEN ARTHUR last night defended the sale of Barbadian land to foreign investors, saying the country had to be able to pay its bills.”

… from the September 28, 2006 Nation News article Paying by Land

Twenty years ago we had everything going for us and we blew it. Of course more emphasis on manufacturing and agriculture would have helped stave off some of the problems that we have now. But it was too easy to sell land, especially on the beach, and comments from visitors who claim that they will not come back often refer to the lack of sea views. Hindsight can be 20/20, but with so little agricultural land left (check the Google Earth picture of Barbados), the way forward will be very difficult. Hi-tech manufacturing is a great idea, but our educational system is not geared to man it, and we need venture capitalists and a legal system than can accommodate these industries quickly. It will never happen.

It’s over for the way of life that we have become accustomed to. Live with it.

Sound the Alarms: A call for Bajans to reclaim our nation & our industry

Where has Bim’s “Pride and Industry” run off to?

by Brudah-Bim

There was a post at BFP written by the good sir Mr. Caleale Goodridge, and he made a good attempt at mapping out how Barbados can structurally overhaul its economy through productive industries such as manufacturing agriculture, and by owning domestic corporations. To be honest, Bim’s economy as well as her bureaucratic and political systems should have been restructured a long time ago. With all the “education” and “leadership in competence” we boast of here in Bim, the nation would have already been well on its way to achieving a standard of living reminiscent to that of Luxembourg, New Zealand, and Iceland combined!

“What doesn’t help our situation either is that there is an over-saturation of other economies within the Caribbean market that are avidly competing with Barbados in two of her major economic platforms; tourism and offshore banking.”

If we had truly competent leaders, the nation would have no external debt and we would have quite the substantial Budget surplus by now. Had we politicians that scrutinized and closely oversaw the sectors that are essential to our nation’s economy through preemptive and strategic means that could have enabled mutual flexibility on part of domestic and foreign markets is a plan long overdue to the people of Bim.

Barbados visitor stats arrive: Should we panic now, Mr. Prime Minister?

A few days ago Prime Minister Freundel Stuart (above) was telling Bajans there is “no need to panic” about our economy having “the worst downturn in nearly 100 years”.

Today as we read Adrian Loveridge’s latest article (below), we’d like to know what the PM is doing – not ‘considering’ but actually doing – about the crisis in tourism and the trickle-down impact throughout the other sectors of our economy. Failing to note any real activity on the part of Mr. Stuart and the DLP, we’d like to ask, “Should we panic now, Mr. Prime Minister?”

“Frankly, I’d like to hear that the PM is panicking. It would be an improvement over his current laid-back demeanor.”

Take it away, Adrian…

What exactly is going so wrong?

by Adrian Loveridge, small hotel owner

The Caribbean Tourism Organisation has now posted the Barbados long stay visitor arrival numbers for the second quarter of this year, and sadly they do not show a pretty picture.

Across all markets – April: down 6.7 per cent (47,979), May: down 9 per cent (37,935) and June: down 4.8 per cent (36, 656). The figures in brackets are actual numbers of landed people and it is compared with the same period last year.

Overall, it equates to nearly 8,400 less visitors and totally negates any benefits from the small gains made in the first three months of 2012.

Based again on CTO statistics, the last average intended length of stay I could find was for 2010 and indicated 9.8 nights. Unless this has dramatically changed, it translates to a loss of over 41,000 occupied room nights based on double occupancy.

While initially these numbers may not seem vast, its the equivalent of filling every seat in more than 56 Boeing 737’s aircraft, or over 4.36 planes per week during the given period.

When the rich start complaining about Barbados prices, environment and urban sprawl then we’ll start to worry… What? Oh oh!

Jet setter Lady Carol Parsons talking about moving someplace else because Bim isn’t what it used to be

We felt sick to our guts yesterday reading Rubia Tinctorum’s piece Barbados: Don’t bother, frankly because for the last seven years we’ve been pounding out the same message here at Barbados Free Press – but obviously to no avail.

We and others warned of willy-nilly development and the rush to block the sea views. We talked about crime being a huge threat to tourism: the engine that drives our entire economy. We warned that our politicians were greedy and setting wrong priorities; holding massive celebratory events like Cricket World Cup while ignoring infrastructure, health care and the environment. We said that our police force budget should be doubled to retain and attract quality personnel and that the police are the guardians of our economy: if crime wins, the tourists leave.

We said all that and much more as so many Bajans have.

When our politicians borrowed millions and millions for ‘studies’ and ‘initiatives’ we asked to see evidence of where the money went. We demanded Freedom of Information laws, to no avail. We demanded Integrity Legislation and received nothing but put-offs and promises while the fat politician piggies kept their noses in the trough. DLP, BLP: all the same.

The politicians borrowed $100 million for a sewerage project and never built it. They received $40 million in EU money for studies of our sugar industry. Well? Where is the benefit? $20 million here for an environmental study, $2 million there for a ‘partnership’ in a failed venture in Nigeria. (Please! What did Prime Minister Owen Arthur expect would happen in Nigeria? What a joke!) Cost overruns of fifty and a hundred percent on every other government project and everyone acts like this is normal. Our Prime Minister personally gives away US$150,000 to a cricket charity and everybody acts like this is normal and Owen’s a great guy for doing that.

“No one asks how much money a man has to have to give away US$150,000 cash or how a public servant can acquire such wealth.”

Green space, nature, the good island life in short supply

The BLP and DLP politicians promised National Parks in the north and at Graeme Hall. Then they blew $150 million on a failed dump at Greenland (in what was to have been a National Park), and changed the law to build on the protected watershed at Graeme Hall: the very last green space between the airport and the city. The politicians sold our best asset: the view of the sea. Bit by bit they allowed their developer friends to wall off large parts of the coast so there’s nothing to see but concrete monoliths and no place for tourists or locals to park and access the beach.

As the economy tanked, food prices skyrocketed and businesses and hotels closed. Petty crime is now a daily concern. One BFP reader recently left a comment that says it all:

“Crime. You can’t grow a tomato without someone hop the fence and steal it. leave a box of laundry detergent on the porch an it be gone! It is not big crime that is killing us it is little crimes. thousands of little crimes every day. every person for themselves. pen on a desk. lunch in the fridge at work! they steal you lunch at work!!!

Crime is killing us but it is not robbery or violent crime, it is little everyday crime that is destroying this island.”

… comment posted by BFP reader Culpepper-X

So now the monied people – the jet setters, the polo players – are starting to look at other places. No doubt that St. Lucia’s new airport will one day see the same squadron of Gulfstreams, Learjets and Falcons that still lines up on the tarmac at Grantley Adams. Sad, but also reality.

There is still time folks. We can turn this around. We can recover much of what we had that attracted people to our little rock.

But we’re not going to do it by electing the same old politicians from any party. We need good citizens to stand as independent candidates, and to band together in opposition to those who are destroying our country.

We’d better make big changes, and we’d better do it fast – because in this day we can’t hide the reality any longer…

Barbados: Don’t Bother, Frankly

by Rubia Tinctorum

Something disturbing is happening on Barbados – the Caribbean experience is being drowned in a tsunami of greed and gravel. With tax dodgers, celebrities, footballers and bloated businessmen all flocking to the island prices have soared. Even my rich friend Lady Carol Parsons complains.

Barbados S&P downgrade all about CLICO and government raiding NIS pension to ‘invest’ in Four Seasons

“Countries with low ratings, including Barbados, are shunned and as a result attract high borrowing rates from financial markets. This phenomenon worsens a country’s fiscal position as higher interest rates eat up more of national revenues that would otherwise be available for expenditure on social services, infrastructure, health and education etc.

The important observation by S&P is that Barbados’s problems are not solely related to the very weak global economy.”

… Peter S. Boos talks about how the rest of the world sees Barbados

In BFP’s recent article Debt Tsunami drowning Barbados: Standard and Poor’s downgrades to junk status we zeroed in on the fact that Standard & Poors’ downgrade of Barbados specifically mentioned the government’s ill-advised raiding of the NIS National Insurance Scheme to carry portions of the national debt burden. We also talked about the impact of the CLICO collapse on the national economy and debt. These decisions by the current government of Barbados seem rather unwise to us… but what do we know? We’re only the poor citizens who have to carry the burden created by our leaders.

It seems though that others recognize the folly of the decisions by the DLP government. Listen to what Peter Boos has to say, and what Standard & Poors’ thinks of the decisions of the Barbados government…

In his writings for the last year or thereabouts, Peter Boos is appalled that the Barbados government should use monies from the NIS to prop up a failed Four Seasons project.

Lest we forget, the reason that the Four Seasons project collapsed in mid-building is that private money does not see it as a winner. Private money ran from the Four Seasons – and that is a clue about the project’s viability. Of course, the politicians do not have the same accountability as the private markets: they can always BS their way to re-election while the real world lives or dies on actual performance.

Standard and Poors’ were also appalled by the rape of NIS funds and by the CLICO fiasco that added immeasurably to our national debt. We don’t even know how much the final bill will be! As we’ve said before it’s a good thing for David Thompson’s legacy that he died and therefore can’t be prosecuted for his personal role in the CLICO mess.

Not that Barbados has ever prosecuted any politician for conflicts of interest or profiteering from a government position.

The whole thing stinks, and Peter Boos explains some of the reasons for the smell in his latest at Barbados Today. You should read the article online at Barbados Today, but we have to print the whole thing because of the Bajan news media’s habit of revising history to suit political agendas.

Here we go…

A blow to our reputation

The recent S&P downgrade of Barbados is extremely damaging to Barbados and its hard earned reputation as a well managed economy.

Countries in the top tier of economic management with high investment grade Sovereign Credit Ratings (provided by S&P, Moody’s, Fitch etc) attract the greatest interest from investors, the ultimate source of wealth creation.

Countries with low ratings, including Barbados, are shunned and as a result attract high borrowing rates from financial markets. This phenomenon worsens a country’s fiscal position as higher interest rates eat up more of national revenues that would otherwise be available for expenditure on social services, infrastructure, health and education etc.

The important observation by S&P is that Barbados’s problems are not solely related to the very weak global economy.