Review of Barbados' Economic Performance for 2012 and Prospects for 2013

To make the harsh observation: Our foreign reserves would have dropped to $1.3 billion if not for that $167 million from the sale of the BNB shares….Was that sale strictly for window dressing purposes to impress the IMF and the ratings agencies? It would have meant 4 continuous years of declines in the year end foreign reserves.

Related Link: Review of Barbados’ Economic Performance for 2012 and Prospects for 2013 (text)

0 thoughts on “Review of Barbados' Economic Performance for 2012 and Prospects for 2013

  1. Succinctly put, 2012 was not one of our best years.
    the “hold strategy” is not working.
    there was virtually zero growth in 2012.
    The prospects for 2013 at best is 0.7 growth.
    We’ve moved from stable to stagnant to lackluster.
    Revenue is down, expenditure and deficit is up, despite “holding”
    If not for BNB (subject to correction) forex would be down as well.

    The 4-5 year trends are like a roller coaster. Kinda like some of the policies and activity during this time. Looking forward to Worrell’s spin.

    Notice the opening line ” Barbados’ foreign exchange reserves increased during the year to $1,467 million, and the import cover at end-December stood at 18 weeks, even though there was no
    real growth in the economy in 2012″

    well well

    Just Observing

  2. Based on the graph it seems that the economy ‘grew’ less in 2012 than 2011. Does anyone know the origins of the $600m in foreign investment that will have no impact on employment according to the Guvnor?

  3. An honest and straightfoward assesment by the Governor reflecting the reality of the Barbados economy.No big surprises.This time of recession or sluggish growth is a time when we focus on the restructuring of the Barbados economy. I beleive that a competent team of Ministers is doing just that: From Dr. David Estwick in agriculture, Donville Inniss in health , the focus on alternative energy and diversification of tourism source markets, and the international business legislation, Growth is necessary but growth must be sustainable. People are looking for a quick fix and while the BLP opposition will promise the moon, the sun and the stars, there is no way on this earth that any BLP government will generate sustainable growth in this economy without a boost in the growth rate of our major trading partners.Show me where in the history of the modern Barbados economy that it has been done.

  4. William Skinner wrote “It is now very obvious that the commercial banking system is making excessive profits even in these dire financial times.”

    Bajans should read Canadian financial news.

  5. @!

    Absent from your analysis is the fact the government continues to subsidise public sector ie.wages AND the private sector clearly signal it will be contracting its labour force.

  6. @ ! | January 15, 2013 at 9:13 PM |

    Dr. Estwick has been appointed pathologist and coroner for the Sugar Industry.
    He has confirmed that the cause death was a result of being screwed too often by the damned blasted lying politicians (dblp). How can the smartass doctor talk about building a new sugar factory when the major raw material does not exist?

    Unless he intends to import the sugar cane from Guyana and Brasil and processed it here like the molasses into rum. Or does he intend to find a commercial use for the dreaded cow itch and like the Lotto turn scratches into money?

    The Skipper’s dream has come true but his alternative plan for tourism and light manufacturing has also suffered cost overruns because of a woefully inflated currency.

    Barbados is not in recession but a deepening Depression that only a pending devaluation can be offered as a last resort to save the place from economic inundation. The government does not want to deal with its fiscal problems so like an alcoholic it would be forcibly encouraged to attend AA where the IMF would be the chief counselor.

  7. @miller
    “How can the smartass doctor talk about building a new sugar factory when the major raw material does not exist?”
    The transition is to more of a cane industry than a sugar industry. We are not internationally competitive in producing bulk sugar but we can move to a greater focus on high end products- specialty sugars not targeted to the price sensitive consumer, molasses to supprt our rum, even specialty bottled waters from the process. We as a nation have realised that the days of Barbados growing “nuff” cane and shipping bulk sugar abroad are pretty much over and have been for a while. My contention is that the BLP did not aggressively address this issue since 1994. Call it BLP inertia, perhaps?

  8. @David
    :government continues to subsidise public sector ie.wages “- David , the public sector wage bill was increased dramatically from 1994 – 2007 coming out of the structural adjustment of the early 1990’s. No BLP politician is talking openly about this issue but like you they criticise the borrowing to pay wages. If the BLP is against this policy but will not say so openly, is it fair to conclude as Sinckler has said that thousands of public sector workers will be sent home if the BLP gets its way?
    By the way that will initially make the economy worse as it would significantly reduce aggregate demand by these workers who are also consumers?
    Have you heard a practical solution from the BLP on this issue or just criticism of a situation which they helped to create?

  9. @!

    Isn’t this what sparked the privatisation debate and the need for us to discuss what are the option? What we know is that 0% growth for the next 3 to d years will force decisions on us anyway. What are we going to do, keep selling national assets to shore up forex?

  10. @!
    You deserve a MA in Spinology. Only you could give a glowing commentary on the report all of us heard and read. What current policies are there to address the

    rising deficit?
    contracting revenues?
    declining tourist product?
    inadequate business facilitation and efficiency?
    increasing expenditure?
    declining forex (remember you said sustainability, so let’s omit BNB)

    And what timeframe would you expect such policies to have a starter effect?
    And what are we the public to do in the interim while we “wait”?

    Just Observing

  11. @ ! | January 16, 2013 at 9:07 AM |

    You can try to spin the sugar tot in the muddy cane fields as much as you like but the following point still remains:
    You cannot have an industry whether it is a “sugar” or a “sugar cane” or just a “cane” industry without the basic raw material input and that is sugar cane plants growing in the cane fields that not even our PM can deny.

    The same way you can’t have a tourist industry without visitors or solar energy industry without sunlight neither can you have a “cane” industry without sugar cane growing in the fields instead of cow itch. Maybe you intend to get fancy molasses and make specialty sugars from the cow itch or even river tamarind.

    Reread your submission and see it make sense in your now informed opinion.

  12. Enuff | January 15, 2013 at 8:46 PM |. Does anyone know the origins of the $600m in foreign investment that will have no impact on employment according to the Guvnor?

    Maybe Couples is going to spend a few hundred million to fancy up Casuarina.

    I must have missed the reports of Couples taking over (leasing) Casuarina in the Barbados papers

  13. Thanks David

    Which paper has report?

    This was in the Jamaica Gleaner on January 4.

    Why so long getting to the Bdos press.

    • @Check-this-Out

      It appears on page 5A of today’s Nation newspaper. A US3 million upgrade is scheduled to begin next month. The report confirms a lease arrangement, details not yet disclosed.

  14. @ David:

    Who is your pick for the next governor of the CCB?

    Do we really need a Central Bank at this stage of our economic development? In the longer term Barbados cannot exist as a separate Finance entity and must join it OECS brothers.
    In so doing the Bajan dollar will become redundant and many functions undertaken by the current CCB will be subsumed in a wider EC regulatory body involving all financial services. This necessary move would bring about synergy and savings.
    A similar move is needed as far as diplomatic and international representation is concerned.
    Maybe Grantley Adams’s goal has come around for implementation. With Jamaica and Trinidad wanting to go it alone and Guyana sucking up to Trinidad why can’t Barbados swallow her pride and join up with the Little Eight or so and they can all become the Big EC Block. And instead of being picked off like fodder for a financial sniper they can put up a fight against the likes of CLICO who, along with the corrupt selfish politicians, on a “divide-and-rule” basis took them individually to the cleaners.

    ‘United We Stand, United We Fall’ ought to be the motto on the new currency.

  15. @Miller

    That is some heavy duty stuff you are asking. Word is Brother Dwight has taken on Nopoleanic status in the sub region. Not sure how Barbados would fare given the incestuous pool of relations which exist.

  16. Audit need to be done of his words, Williams who was there before him know i telling the truth , She heard me tell Town &Country what is going on as she sat by the door wearing her Blue suit, Next thing you know she gone and this man there now..A million Dollars missing, who and how and who went to jail? , Money” CASH” gone , but the numbers still on the books. Inside JOB
    ,We might know the real numbers after the vote.
    lawyers and bankers look out for them , best place for your money is in your pocket.
    Buy Gold and Sliver .Bank on that.

  17. @ David:

    Do you know anything about the progress being made regarding the West Coast Sewage Project? Was any mention made of it by the Government in its recent budget speech on in the Governor’s report as a possible economic growth driver in 2013?

    This is a major infrastructural project that must be put in place if further development or upgrade of the tourism plant in Barbados.
    One of the major causes of beach and coastal erosion and degradation of our reefs is the outflow of waste into the sea along the West Coast.
    We need to put a stop to this if we are to save Barbados’ only great natural resource, the beaches and reefs.

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