Dec 2014 Financial News

Harford: Barbados still very desirable

Dec 18, 2014

Republic Bank Ltd (RBL) chairman Ronald Harford told a gathering of high-value Barbadian business customers on December 12 that the island remained “a very desirable place to do business and work,” according to newspaper reports.

However, he cautioned that the well-recognised quality of frugality, for which Barbadians had always been known, needed to be restored starting with the government. Harford was addressing the bank’s Christmas cocktail reception at Port St Charles Marina.

From Parliament, Barbados Finance Minister Chris Sinckler announced a tax amnesty and promised the people of Barbados no new taxes.

“Government can’t tax or cut our way out of a recession,” Sinckler said. There will be smaller expenditure cuts and more efficient tax collection, Sinckler said. The island nation’s budget will be delayed to April 2015, at the end of government’s 19-month stabilisation programme, Sinckler announced.

Both Port-of-Spain-headquartered RBL and First Citizens Bank have loaned money to the government of Barbados as it struggles with high debt, low growth and a remedial reform programme. Sinckler said the reform programme has been extended until April 2016. He said the fiscal adjustment programme has been effective in restoring balance to the foreign exchange market and the value of the Barbados dollar. Barbados now has 14 weeks of import cover in foreign reserves, he told Parliament.

He said Barbados has “largely” reached its targets to reduce the fiscal deficit to 6.6 per cent of gross domestic product (GDP) by the end of March 2015. Barbados has achieved large savings through the reduction of salaries, Sinckler said, referring to layoffs of over 3000 government workers over the past year. Sinckler said the Municipal Solid Waste Tax will be revisited.

He said too that government will introduce a Fiscal Responsibility Law which will govern the way the public purse is spent. There will be reform of some state-owned enterprises, he said, in full consultation with the Social Partnership, Barbados civil society agglomeration.

Barbados’ government will be working closely with the private sector, Sinckler promised. He said there will be a national discourse on education, healthcare and environmental management.

Source:
ALEEM KHAN
Trinidad Guardian, A25
Thursday December 18, 2014