Is Prime Minister Stuart Competent to Lead Barbados at this Time?

Prime Minister Freundel Stuart

The tax haven Barbados is dying just now. The escape clauses in the offshore contracts are activated e.g. in the case of a downgrade to C, financial breakdown or revolution. No foreign investor will come to Barbados now to do any fresh offshore business, since a tax haven must offer financial security. There are multiple other island around with better rating, better policies, better prospect and a more motivated population.” – Tron

In response to the recent umpteenth credit rating downgrade by Moody’s that quickly followed S&P Global Prime Minister Freundel Stuart was quick to break his accustomed silence to issue the following comment:-

We seem now to be working ourselves back into a frame of mind where once again we want to sit exams for people outside of Barbados and wait on them to grade us and if they tell us we have passed we are supposed to feel good that we have passed, and when they tell us we have failed we are supposed to hold our heads in shame and think that we are failures

One understands with a general election on the horizon the prime minister wearing his other as leader of the Democratic Labour Party (DLP) had to spin the bad news of the recent downgrades to some benefit. Bear in mind this is the leader of a country where our foreign reserves have dipped to ten weeks of imports cover and the government is forced to sell national assets to shore up the international reserves. This is a prime minister who heads a country where the foreign commercial banks have demonstrated little appetite for government securities. The point to be made is that the structure of our economy is dependent on the assessment of external players to perform. Does the prime minister not understand that the commercial banks in Barbados will implement credit and risk polices based on the ratings of the credit agencies? Does he not understand that the plummeting credit rating will make borrowing of foreign currency expensive IF we are even able to procure it? Why would he slam that door given our current economic state. Did the prime minister not observe how holders of Barbados bonds in the international market have reacted based on the Bloomberg report?

More important for BU and should be for the prime minster. What message is he sending at a time when the country should be in a serious mode of planning and productivity to ensure we  work together to make Barbados great again? Why should a country whose economy is in such a perilous state where a Governor of a Central Bank whose second contract was renewed in 2014 resign days before the downgrades? How does prime minster Stuart feel so emboldened to disrespect foreign financial players who access the reports of the rating agencies as a routine pre condition for lending or investing in a country? Are we to assume the government is confident all of our foreign currency borrowing will be satisfied by concessionary lending from the Chinas of this world?

BU took note how quickly minister of Commerce Donville Inniss added that the recent downgrades would be upsetting to foreign investors. Is the prime minister an economic illiterate not to have realised that we are a country very dependent on foreign direct investment whose principals would want to be assured that there is manageable risk if they decide to do business in Barbados? The bottomline Mr. Prime Minister is that investors will avoid doing business with any country that have been assigned junk status by the big 3 credit rating agencies read Moody’s, S&P and Fitch.

We look forward to the outcome of the deliberations by the two committees of the social partnership who should be submitting recommendations soon to the prime minister. We now live in very uncertain times.

144 comments

  • fortyacresandamule

    If Barbados reserve is so dangerously low, why is it we are not hearing about the black market rate? Any currency that comes under such pressure, is vulnerable to hoarding and speculation. Eg. Venezuela , Nigeria, Trinidad, Egypt etc.

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  • Carson C Cadogan

    Yes we agree a DLP ‘victory’ was unexpected.

    It was a minor miracle that the DLP was able to stay.

    We then called for a national unity government because we knew what was coming

    But still you charged us with being BLPites. That was not nice either.

    We cuss them too much.

    In fact, we have called, many times, for both parties to be declared as proscribed organizations.

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  • Bim is being kept alive by the alternate economy i.e….guns&drugs…….

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  • Carson C. Cadogan

    Pachamama

    “Yes we agree a DLP ‘victory’ was unexpected.”

    You wrong again. We expected a DLP victory it was only those on BU who expected a BLP victory.

    They were not busy on the ground as I was. There were writing from Cananda, America, England, from their wheel chairs in Barbados and so on , totally disconnected just as they are right now.. They had no idea what was really going on.

    And just like now they were getting all information from the Barbados Labour Party. Which is a very dangerous thing to do.

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  • Carson

    You really find confidence in a 1 or 2 seat majority.

    Only a party loyalist would seek to govern based on such.

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  • fortyacresandamule

    @ Pacha. Sagicor core business is insurance. Not offshore incorporation. Plus, Sagicor is part of the domestic financial landscape unlike the offshore financial sectore. Therefore, a downgrade will affect them, especially, given their international bond liabilities portfolio.

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  • Fortyacres

    Sagicor has headquartered to TNT since last year as a result of the economic climate.

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  • @fortyacresandamule

    You are suggesting people risk is not considered by iBcs.

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  • Carson C

    This DLP government is poor rakey…….ney ney

    Even with Owen on your side. LOL

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  • Carson C. Cadogan

    Unlike you all here on BU we have our strategies. But we keep a close eye on the Barbados Labour Party.

    You see that little sponsored walk which took place on Sat. that was so revealing. You all see all that electronic equipment which were set up in Jubilee Gardens, that dont come cheap. The phone banks which were set up to call people’s homes that dont come cheap. the ads in the Nation newspaper those dont come cheap. The flyers which were distributed those dont come cheap. The sound trucks which were used to to go into the villages those dont come cheap.

    So if the Barbados Labour Party was willing to spend $100,000 to promote that sponsored walk which attracted only 9,000 people for the money which was spent. And we must not forget that only about 3,000 of those people would probably vote for the BLP, as the rest were only out for the evening entertainment and the wuk up music and the free food and drinks and the school children with no vote, we know how many millions of dollars they will be spending in the up coming elections. They will attempt to flood Barbados with money in the vain hope that they will buy their way into the halls of Govt.

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  • Sagicor to Bermuda, sorry

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  • Carson C

    Continue to entertain those pipe-dreams until you find yourself in the opposition, at best.

    Because there maybe a constitutional crisis. Not one DLP member and therefore, no leader of the official opposition

    With all this economic disorder, you really think it would take the spending of money to get this DLP out of office. To get 10,000 on the streets in protest.

    Well, we wish you well with that.

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  • @Pacha

    The idiocy is exposed every day. We have the trolls on BU braying like the proverbial jackass and then you listen to Minister Donville Inniss on the midday newscast admitting he has taken note of the large crowd that marched on the weekend and the message it sent to government.

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  • David

    Thanks.

    Anytime you see 10K Bajans on the streets it could read 50K or 60K in real terms, yuh know how cagey Bajans are.

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  • In 2013 the DLP bought a miracle with money from a private developer, doubt that doubt you living. In 2017/18 the connection between the buying votes, the movement of that money and the award of that/those contract(s) will be revealed. ‘Mia told wunna Mark Her Words’

    The Minister of Finance is in a Parliament today talking a roll of garbage. With this ‘imposter’ in charge of matters economic and financial no wonder Barbados is in the position it is in. This ‘joker’ should be in Holly/Bollywood deserving of an Oscar for Leading Male Performance (kinda) even tho the movie, ……………………………………DLP – The Suffocation of Barbados has been a complete flop.

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  • I hope the good people of Barbados are watching the Minister of Finance carefully to see how even in dire economic straits he is smirking and acting like the 100% politician that he is. I say without reservation the CHRISTOPHER SINCKLER is the worth thing to have even visited upon Barbados. Total destruction of the economy and a don’t-care-ish attitude to go with it.

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  • fortyacresandamule

    @ David. Of course they do, like any business per se. But Barbados is no Somalia, Syria, Haiti etc. A country going through a fiscal challenge couple with balance of payment issue is just a minor nuisance for IBCs.

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  • fortyacresandamule

    @Pacha. Sagicor is a participant in the international bond market, so, it’s probably more prudent for them to domicile in a territory whose sovereign boast a top notch credit rating. And not not mention all type of sophisticated tax avoidance scheme.

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  • Pachamama March 13, 2017 at 11:10 AM wrote:
    David
    No country is really earning its way.
    Everybody lives on debt. The system is based on debt.
    And sensible people have long realized that
    And are ridding the system to its inevitable end.
    When all debt will have to be cancelled.
    Do you hear any body ever talking about paying back the national debt of Barbados or anywhere else.
    Only interest.

    David Replied:
    @Pacha

    Of course, in much the same way householders have to prudently manage debt. However, earnings and debt accumulation must be intelligently managed.

    So just which countries are intelligently managing debt (assuming that finance ministers and central banks kicking cans down the road does not qualify as intelligent management)?

    $21,714 For Every Man, Woman And Child In The World – This Global Debt Bomb Is Ready To Explode

    By Michael Snyder
    According to the International Monetary Fund, global debt has grown to a staggering grand total of 152 trillion dollars.  Other estimates put that figure closer to 200 trillion dollars, but for the purposes of this article let’s use the more conservative number.  If you take 152 trillion dollars and divide it by the seven billion people living on the planet, you get $21,714, which would be the share of that debt for every man, woman and child in the world if it was divided up equally.

    So if you have a family of four, your family’s share of the global debt load would be $86,856.
    Very few families could write a check for that amount today, and we also must remember that we live in some of the wealthiest areas on the globe.  Considering the fact that more than 3 billion people around the world live on two dollars a day or less, the truth is that about half the planet would not be capable of contributing toward the repayment of our 152 trillion dollar debt at all.  So they should probably be excluded from these calculations entirely, and that would mean that your family’s share of the debt would ultimately be far, far higher.

    Of course global debt repayment will never actually be apportioned by family.  The reason why I am sharing this example is to show you that it is literally impossible for all of this debt to ever be repaid.

    We are living during the greatest debt bubble in the history of the world, and our financial engineers have got to keep figuring out ways to keep it growing much faster than global GDP because if it ever stops growing it will burst and destroy the entire global financial system.

    More: http://www.activistpost.com/2017/03/21714-every-man-woman-child-world-global-debt-bomb-ready-explode.html

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  • Note in my post above, 2nd paragraph after David’s response @Pacha was my own comment/question, not David’s.

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  • How long Sinckler plans to speak? Just rambling!

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  • @enuff

    Correct, let the debate on the numbers begin.

    The time for campaigning will come.

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  • @ Pacha
    We could only borrow as much as the bankers would lend…. not what our greed and imagination can conceive…. Only the USA have been able to do that so far – thanks to their petro dollar …and to a vast military complex that they have been more than ready to deploy…

    We have reached the max that we could extract from the system, and are about to experience the free-fall back to reality.

    The USA, thanks to their special petrodollar advantage, will get their free-fall from a much higher place than ours…. and soon too. It won’t be pleasant.

    We are all in for a lotta free falling shortly…..

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  • So large crowds mean nothing if nothing of substance is extracted. The long and short being that people are asking solutions
    The blp took one hundred thousand dollars to organize a march
    The bold question remaining how does a march overturn the misfortunes of the economy burden with debt

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  • Bushie

    Only if there are no Bajan bankers with a nationalist intent operating within international markets

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  • Greenie

    Of course, but that is only one aspect of debt.

    If we are to consider derivatives (debt) we’ll have to add another 600 trillion.

    The national debt of the is around 20 trillion, however when unfunded liabilities are added we get to a figure of over 200 trillion.

    None of this is payable, repayable.

    So why would a country, Barbados, not try to fully utilize a bad system. And opt instead to play by nebulous rules.

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  • Bushie

    You talk about the US and the petro-dollar.

    But the people responsible is not the government per se, but individuals.

    You already know that the system, like the FED, is all private.

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  • enuff

    For the rest of the day as he balances the political speak of swiping at all the opposition members and at the same time begging them,the private sector et al to tell them what to do.

    I hope the opposition members do not follow him into making the chamber a circus and that the LoO takes the high road to his low road.

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  • It is hard to listen to Stinkliar for a sustained period………….he has basically admitted he has failed as nothing has worked and all he is saying we have to do this, we have to that……….

    Listening to him reinforces why we are where we are today.

    Sad!

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  • Carson C Cadogan is Carson C Cadogan. I am positive that one of his last contributions to BU, before this present rebirth, was to bitch about politicans ,who during the election campaign, promised those leading supporters who help to get them elected, the world, but when they get into office, they turn their backs on the same supporters. Its now obvious, on the approach of a general election, that Steve Blackett has come through for Carson.

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  • Well Well & Consequences Observing Blogger

    Lol…, ah glad they are jammed up, the ministers wont stop telling lies, they are all lied out.

    Carson has not answered not one question he was challenging us to ask him……he is a fraud.

    Steve Blackett should never be returned to parliament, another failure to the people, they still think it’s a game, these politicians.

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  • MAM is presently speaking and exposing the ignorance of the MoF for all to see.

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  • “fortyacresandamule March 13, 2017 at 1:24 PM #

    If Barbados reserve is so dangerously low, why is it we are not hearing about the black market rate?”

    What makes you think there is no BLACK MARKET RATE, in the last month I’ve gotten 2:1 for Canadian $ and 2.5:1 for US$.

    People everywhere offering premium for the YANKEE $.

    The BLACK MARKET just getting started, the question is what will this underground market go to, maybe we’ll find out what the real exchange(devalued) rate is.

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  • Carson C. Cadogan

    Pachamama

    “Continue to entertain those pipe-dreams until you find yourself in the opposition, at best.”

    DAVID said something similar in the run up to the last general elections.

    And as they say the rest is history.

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  • I was trying to do some research on the way this DLP has been managing this economy since they came to office……….I have only been able to extract figures up to 2013 so far.

    It is clear that this minister of finance does not know what he is doing. He has been over spending every year and it is clearly this is unsustainable. This is nobody’s fault but Chris Sinckler.

    2008/9 overspend $ 189 million
    2009/10 overspend $ 486 million
    2010/11 overspend $ 641 million
    2011/12 overspend $ 266 million
    2012/13 overspend $ 553 million
    2013/14 Apr-Dec overspend $505 million

    Now tell me, whose fault is this……….Sinckler you are the problem.

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  • The question of Stuart’s competency was asked and asked prior to the last election. And here we are.

    Liked by 1 person

  • Carson C. Cadogan is the Hon. M. Lashley. This is for the information of the bloggers here. Check his FB page.

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  • Well Well & Consequences Observing Blogger

    Beware the Ides of March.

    Their mismanagement of the economy from 2008 to present is upon them.

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  • Willing To March More

    Freundel Stuart is a selfish jackass who will not demit office or call elections under any situation other than by the ballot. I will march until Stuart is forced out of office.

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  • No, fortyacresandamule, I strongly disagree. Barbados is affected by the mess.

    The “light” side of offshore havens covers institutional investments by international companies = legal

    The “dark” side covers hiding money and tax evasion = illegal

    Let us take international captive insurances as an example for the “light” side.

    Look at the ranking at wikipedia:
    Bermuda: 19.3%
    Cayman Islands: 15.4%
    Vermont: 11.4%
    Guernsey: 7.4%
    Luxembourg: 5.3%
    Barbados: 5.2%

    Now look at the rating:
    Bermuda: A+ (S&P)
    Cayman Islands: Aa3 (Moody´s)
    Vermont: Aa1 (Moody´s)
    Guernsey: AA- (S&P)
    Luxembourg: Aaa (Moody´s)
    Barbados: known

    No international company can afford to setup a new captive in Barbados due to internal compliance and other regulations.

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  • “IS PRIME MINISTER STUART COMPETENT TO LEAD BARBADOS AT THIS TIME?”

    No. Nor was he ever.

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  • Well Well & Consequences Observing Blogger

    Carson fizzled out like yesterday’s old news, still has nothing worthwhile to offer, he is believed just about as much as Sinckler, Fruendel, the ACs and Alvins….none have credibilty…lol

    Like

  • Is there a Carson C. Cadogan in the electoral register, or the telephone directory, the land tax register, motor insurance, or on any credit reference agency?

    Like

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