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Will The Estimates Debate 2009 Be One With A Difference?

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Prime Minister of Barbados Hon David Thompson
Prime Minister of Barbados Hon David Thompson

The Estimates Debate for the financial year 2009 started in parliament today (18/03/2009). It is expected to be an Estimates Debate with a difference, expected to be followed with keen interest by many because of the grave economic times which is afflicting the world. Unfortunately the BU household was unable to listen to 100% of the debate but we anticipate that members of the BU family who did may want to use this blog space to share their views and opinions.

We missed part of the Prime Minister’s opening address, what we heard was delivered in a debating style which Barbadians have become familiar. Our opinion at this early juncture in the debate was a clear lack of a priority one focus  by the Prime Minister on an economic strategy considering the global financial meltdown.

Like Obama Thompson needs to be engendering confidence in the PEOPLE that his government is prepared to roll out economic strategies to stabilize and energize. We must plan on the basis that there is the opportunity to position Barbados to build on its economic prosperity in a post-meltdown global economy.

Conversely the Leader of the Opposition Mia Mottley’s opening salvo was very economics focused. A couple members of the BU household were impressed by her wide-ranging grasp of the economics issues currently challenging the country. She was scathing in her criticism but equally generous in her praise of of some government initiatives. Refreshing to note was the insight presented on some policy initiatives which the Opposition would like to see implemented.

Before BU is roasted alive for expressing our opinion let us all continue to monitor the debate, it is early days yet. An observation made by the Opposition Leader which has caused some consternation in the BU household is the reference that the government will likely run a 1 BILLION dollar deficit, the highest ever in our history.

While we understand the depressed economic conditions which will obviously cause a fall in revenue, and that government will have to intervene by spending more, we hope that our government understands it has to tread daintily on pathways not previously travelled.

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  1. David Avatar
    David

    @livinginbarbados

    Thanks for the clarification of the jargon but would appreciate if you could use your training to editorialize a little. Given the use of the information in political contexts by current and former PMs and Opposition leader what is your interpretation.

  2. livinginbarbados Avatar
    livinginbarbados

    @David
    What do you mean editoralize?

    Like any number, the interpretation largely depends on what you want to argue.

    Professionally speaking, it’s dangerous to draw conclusions without a better handle on the underlying transactions and what is envisaged for say the next 12 months.

    But the international reserves are meant to be used as a cushion against hard times, and the figures show that they needed to be drawn on heavily during 2008 (world heading into recession, no major shock there).

    An interesting and provocative question would be whether the fall in the commercial banks’ net foreign assets was driven by customers’ needs or the banks’ needs for portfolio management reasons.

    The voice to hear on the issues is really the Governor’s not other observers’.

  3. livinginbarbados Avatar
    livinginbarbados

    Like Trained Economist, I have problems with Royalrumble’s arguments. Rr says that the “stimulus package” will create income generating assets. Well, maybe. But, if so, when are we expected to see that income flowing in? What will be the state of the reserves used to finance the “stimulus” by that time?

  4. David Avatar
    David

    So give us the What it.

    We continue to suck on our balance of payment reserves at current rate. We can only assume that the government based on current consumption and global meltdown it will be forced to borrow large sums of money. Please finish?

  5. Georgie Porgie Avatar
    Georgie Porgie

    David you are prompting the “witness man” LOL. Or are you acting as “school master?” LOL. I like it. Must be difficult to opine on such lofty issues, I imagine.

  6. livinginbarbados Avatar
    livinginbarbados

    When the IMF’s Article 4 report was issued last August, it showed the forecast trends for the economy, see http://www.imf.org/external/np/sec/pn/2008/pn08111.htm.

    It showed Barbados’ net international reserves (NIR) due to increase from US$ 775 mn in 2007 to US$ 800 mn at end 2008; instead they fell to US$ 673 mn. The IMF report forecast that NIR would be at US$ 781 mn at end-2009.

    One set of numbers does not tell a story, but given the unexpected reversal in 2008, I have yet to hear if a rebound is expected for 2009, or if the expected fall in NIR in 2009 is still to come. We know that US$ 150 mn has recently been borrowed.

    Many economic indicators have changed dramatically for the worseover the past 6 months. So, it’s important to know or try to understand how far off the mark the country is tending before you can figure out what to do to bring it back in line.

  7. Dark Knight Avatar
    Dark Knight

    livinginbarbados // March 23, 2009 at 9:02 pm

    Like Trained Economist, I have problems with Royalrumble’s arguments. Rr says that the “stimulus package” will create income generating assets. Well, maybe. But, if so, when are we expected to see that income flowing in? What will be the state of the reserves used to finance the “stimulus” by that time?
    ………………………………….

    For clarity; strong, visionary leadership and pure natural brilliance – here is a transcribed edit of Miss Mottley’s Estimates Reply:

    “Nobody is blaming the member for St. John for oil price increases.

    Nobody is blaming the Member for St. John for the fact that for the first few months last year – coming out of the last six month of 2007 – that there was food commodity increases!

    But what we are blaming him for Sir – is his failure to act to protect ordinary Barbadians – in circumstances, where he had fiscal room.

    And if you doubt it that he had fiscal room Sir, or you doubt it that he could carry up debt Sir, the Hon. Member for St. Philip West – last Tuesday, came in here and raised a loan for US$150 million Sir, so we know that they could raise loans.

    We know that they could raise debt.

    The question is, for whom are they prepared to do it?

    That is the question. ”

    Next I will tell you what are the consequence of Thompson’s poor judgment and bad decisions.

    Stay locked-on for more, including the stabilization plan Miss Mottley is calling for!!!

    “

  8. Bajanbat Avatar
    Bajanbat

    “And I have already instructed the Government owned entities which have deposits with Clico Mortgage & Finance not to move any money except it is in the normal course of business to meet obligations. I might add that I have signaled to Prime Minister Patrick Manning that one initiative that would go a long way would be an agreement by the Trinidad government that it would not seek to enforce the injunction granted in the Trinidad courts in respect of CL Financial’s assets in the Eastern Caribbean.” Clear instructions – LeRoy tell me to tell wunnah don’t touch Clico or else yuh gine have to deal wid he! We really in LeRoy’s pocket now.

  9. Bajanbat Avatar
    Bajanbat

    2. It is becoming evident, if it is not already obvious, that David has very little grasp of complex economic matters. He is relying largely on Darcy who is an accountant/economist/consultant by profession, not really a professional economist. This is not a good position from which to manage our economic destiny in these times.
    Is anyone aware of the tax reporting requirement being imposed on the business community? If not let me give you a brief idea.
    It is now necessary under penalty of fines for EVERY company (large and small) to prepare annual returns of any and all money paid to a worker during the financial year. This applies to all those persons who are not on the regular payroll whose income is already reported to Dept of IR.
    What this means is that anyone who does any work for a company will find that this income may now be subject to tax months after that money has already been spent for food, school clothing, medicines etc. Further it will bring their name and ID number into the Income Tax records and make them forever subject to further scrutiny by the Dept of IR. While it is proper that everyone should pay their fair share of tax we all know that the level of taxation in Barbados is already higher than in many other countries and there is in some cases abuse by those at the higher income levels who can afford to find ways to avoid tax. Those at the lower end of the income scale will again be called on to pay tax on their hard won earnings. This is just another example of how the Dear Loving People treat the masses to whom they so vocally appeal every five years for support and who respond with a vote which allows those Dear Loving People to regain power. Don’t mistake that Beresford does much the same but if one is fair one will realise that it is largely Beresford who reduces taxation and actually empowers the people. Despite David’s assertions to the contrary, anyone who denies the progress that Barbados has made over the past decade may in fact be too biased to be considered objective.
    The country cannot develop through small enterprise alone but the Dear Loving People are myopically focused on that sector which they know carries the votes. Power is the name of their game, not Barbados. Not since The Hon EWB was in office have the Dear Loving People been a party of the people. This current group are a poor imitation of his party and what he stood for.
    Wake up Barbados!!

  10. Dark Knight Avatar
    Dark Knight

    Here is something from the Trinidad Guardian:
    …………………………
    Duprey in energy ‘fire sale’ to raise severance money

    Anthony Wilson | 9:52 pm
    Published: March 23rd, 2009

    Three days after publicly signing the Memorandum of Understanding (MOU) aimed at saving Clico’s depositors and policyholders, Lawrence Duprey was scrambling in a virtual fire sale to sell off key energy assets to his German business partners, according to documents made available to the Trinidad and Tobago Guardian.

    Duprey sold the group’s 51 per cent stake in Clico Energy to Proman, a German project management company, which held the balance of 49 per cent, in order to pay CL Financial’s severance, termination and on-going administrative costs.

    Duprey would be among the beneficiaries of the severance packages.

    The agreement between Duprey and Proman, which is dated February 3, was arrived at following less than 24 hours of “negotiations” and after an exchange of letters between the two sides, in which Duprey said CL Financial “would be extremely pleased to enter into immediate discussions with you with a view to selling our entire 51 per cent shareholding in Clico Energy.”

    Duprey agreed on February 3 to sell CL Financial’s 51 per cent in Clico Energy, which is the parent company of Industrial Plant Services Ltd, and Eurotecnia Melamine, for US$ 46.5 million.

    The agreement between Duprey and Proman placed a value of about US$91 million on Clico Energy.

    CL Financial’s 51 per cent stake in Clico Energy included a 17 per cent stake which it held in trust for Clico. The deal arrived at by Duprey and Proman placed a value of US$15.5 million on the 17 per cent stake in Clico Energy owned by Clico.

    The valuation which Proman and Duprey used was dated February 2009 and was conducted by Till Reuter of a company called RINVEST AG.

    But, according to the documents, a valuation of Clico Energy done by staff of Clico determined that the value of the Clico Energy shares held by Clico as at December 31, 2007, was US$68.9 million—which was 4.4 times more than the US$15.5 million to which Duprey had agreed.

    The documents reveal that instructions were given to an escrow agent for the sum of US$15.5 million to be transferred to Clico’s account No 1583741 at First Citizens.

    The instructions to transfer the money mean that, if the transaction were fair, CL Financial would have lived up to its side of the January 30 MOU, which required it to apply any proceeds of asset sales to meet the statutory fund deficit, which has been estimated at $10 billion.

    The Clico Energy shareholders’ agreement states that if a shareholder (like Clico, CL Financial and Proman) has been declared bankrupt, has been wound up or is in default, the shareholder shall be deemed a seller.

    Neither Clico nor CL Financial has been declared bankrupt, nor is there any evidence that either company has defaulted on any of its loan agreements.

    The shareholders’ agreement also gives shareholders the the right of first refusal in terms of shares held by the other party.

    The Guardian understands that on February 3, as well, CL Financial and Clico wrote offering to sell Methanol Holdings (Trinidad) Ltd to Consolidated Energy, which is a holding company for the German firms of Ferrostaal, Helm and Proman.

    That attempted transaction, which would have been in breach of the Memorandum of Understanding, was stopped after it was discovered by Claude Musaib-Ali on the day he took up office as the new manager of Clico, February 4.

  11. A.Y.W. Avatar
    A.Y.W.

    PRESIDENT BARACK OBAMA IS BRILLIANT!

    Speaking of Barack Obama—Barack Obama is a racial-minority individual and does not like racism:

    And Michelle Obama is a racial-minority individual and does not like racism:

    SCANDALS! SCANDALS!

    SOME OF THE WORST CASES OF RACIAL PREJUDICE IN WORLD HISTORY!

    CONSTRUCTIVE WORLDWIDE DISSEMINATION OF INFORMATION RELATING TO SCANDALS:

    (I) I do solemnly swear by Almighty God that George W. Bush committed atrocious, racist, hate crimes of epic proportions and with the stench of terrorism which I am not at liberty to mention. Many people know what Bush did. And many people will know what Bush did—even until the end of the world. Bush was absolute evil. Bush is now like a fugitive from justice. Bush is a psychological prisoner. Bush often worries. In any case, Bush will go down in history in infamy.

    (II) It is opined that Bill Clinton committed terrifying, racist, hate crimes during his presidency, and I am not free to say anything further about it. ‘Be sure your sins will find you out’ (Numbers 32:23).

    (III) What if basically all racial-minority people would subscribe to the interpretations that George Herbert Walker Bush committed monstrous, racist, hate crimes while he was the President of the United States? It will eventually come out: it is only a matter of time.

    (IV) I know it may be hard to believe. However, Ronald Wilson Reagan committed horrible, racist, hate crimes during his presidency.

    Respectfully Submitted by Andrew Wang, J.D. Candidate
    B.S., Summa Cum Laude, 1996
    Messiah College, Grantham, PA
    Lower Merion High School, Ardmore, PA, 1993

    (There are thousands of copies on the Internet (by March 29, 2009) indicating the contents of (I), (II), (III), and (IV). For example, one can go to Google right now, type “George W. Bush committed hate crimes of epic proportions and with the stench of terrorism,” hit “Enter,” and readily find 1,000 or more copies indicating content of (I). For example, one can go to Google right now, type “Bill Clinton committed racist hate crimes, and I am not free to say anything further about it,” hit “Enter,” and readily find more than 310 copies indicating content of (II). For example, one can go to Google right now, type “George Herbert Walker Bush committed monstrous, racist, hate crimes,” hit “Enter,” and readily find more than 130 copies indicating content of (III). For example, one can go to Google right now, type “Ronald Wilson Reagan committed horrible, racist, hate crimes during his presidency,” hit “Enter,” and readily find more than 90 copies indicating content of (IV). And there are thousands of copies in very many countries around the world. For example, there are innumerable copies in Australia, Brazil, Canada, China, France, Germany, India, Japan, Korea, Russia, the United Kingdom, etc.)

    “BAD NEWS FROM THE UNITED STATES: ON THE RACIST HATE CRIMES AND ETERNAL INFAMIES OF GEORGE W. BUSH, BILL CLINTON, GEORGE H.W. BUSH, AND RONALD REAGAN” BLOG OF ANDREW WANG

    badnewsfromtheunitedstates.blogspot.com
    _______________
    ‘If only there could be a ban against invention that bottled up memory like scent & it never faded & it never got stale.’ Off the top of my head, it came from my Lower Merion High School yearbook.

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