The current DLP keeps telling Bajans that things are “OK and NOT that bad in Barbados”, however below is the overall summary of the DLP produced 2012-2013 Barbados Estimates. The DLP has given Bajans (5) straight years of a major account deficits due to poor fiscal alignment, budgeting coupled with ZERO fiscal vision for Barbados.
Estimated Current Barbados Revenue – $2,656,139,783
Estimated Total Barbados Expenditure – $3,645,859,147
Estimated Excess of Total Expenditure over Current Revenue $989,719,364
Capital Expenditure at January 31, 2012 increased by 6.2% over capital expenditure for the same period in fiscal year 2010-2011
(excerpt from DLP produced 2012-2013 Barbados Estimates)
Now you tell me BU does the 2012-2013 Barbados Estimates summary above give you the “warm fuzzy” that things are OK in Barbados, keeping the PM in mind and the possibility of giving the DLP another term?
A Few Facts
In 2008 under the BLP corporate taxes earned $499 million dollars today under the DLP corporate taxes are bringing in $203 million dollars LESS than 4 years ago.
In the 2011-2012 DLP projected budget revenue was 2.5 billion, actual revenue was 2.4 billion, a budget “over estimation” of $100 million.
Now a little on our recent Moody’s report which did not downgrade Barbados but “WARNED” that Barbados national expenditures MUST be reduced to avoid a downgrade in the next period (see excerpts from Moody’s report below:
Barbados’ ratings have a negative outlook. The negative outlook reflects Moody’s view that while the worst appears to be behind in terms of economic deterioration, and deficits should continue decreasing slowly due to the government’s strategy of gradual fiscal consolidation, they will remain relatively large for the next few years unless the government takes more drastic action than currently expected. As a result, government debt ratios are likely to deteriorate further over the next 12 to 18 months to levels that may no longer be consistent with an investment grade rating. The negative outlook also reflects the possibility that pressures on Barbados’ fixed exchange rate could result due to an anticipated rise in the current account deficit in a context of large and increasing government deficits.
What Could Change the Rating – Up:
Given the negative outlook, Barbados’ ratings are unlikely to face upward pressure in the near-to-medium term. However, the outlook could return to stable if Moody’s determines that (i) the government is likely to exceed current expectations regarding the pace of fiscal consolidation, (ii) economic growth is likely to pick up on a sustained basis, and (iii) the government demonstrates a credible plan to successfully reverse the recent increase in debt ratios.
What Could Change the Rating – Down:
The ratings will be downgraded if Moody’s determines that the recent increase in debt levels is not likely to be reversed in the near-to-medium term, or if pressures on the currency peg materialize.
In closing on this submission based on facts … you tell me BU does it appear that this is the time for us as a nation to be building a “society” like the DLP likes to say, or is this building a society talk a distraction from the real state of national affairs?