Barbados is Sinking
There is no room for hubris, arrogance, false pride and ignorance …
“Government’s chronic crises of excessive debt, high fiscal deficits, falling foreign exchange reserves and overstaffed and outdated institutions for delivering public services are only a part of the deeper problem.”
by Peter N. Boos FCA
Recent events and public pronouncements both locally and internationally have confirmed the very poor state of the Barbados Economy.
Government’s chronic crises of excessive debt, high fiscal deficits, falling foreign exchange reserves and overstaffed and outdated institutions for delivering public services are only a part of the deeper problem.
This is not a crisis like any we have ever experienced and it requires a response like nothing we have done before.
Waiting for recovery is not an option. Many countries already have strong growing economies. In Barbados all of our productive sectors are under-performing.
Barbados is in a deep structural vortex and it will take great leadership, courage, new thinking and teamwork to dig us out a step at a time and build a strong sustainable economy.
This crisis has been in the making for many years.
Whilst spending less is critical, our fiscal and monetary deficits are symptomatic of the many underlying weaknesses that retard growth and investment.
Our limited export sectors, our outdated education system, the dysfunctional Legal Justice System, our poor labour productivity, pitiful business facilitation, lack of private sector innovation, absence of good leadership and management skills are all areas needing significant improvement.
“Cutting costs by laying off people will not fix the problems and create a competitive economy. It could in fact do the opposite if the result is social unrest.”
Increasing taxes will create further corruption, unemployment, business failures, mortgage defaults and bankruptcies.
For those same reasons a devaluation will cause pain with little gain and will deliver a severe blow to our ‘national brand’.
The Barbados reputation for conservative, prudent, financial management has been decimated. Lost reputations are difficult to recover. Continue reading