Barbados suffered ANOTHER downgrade from S&P Global credit rating agency – long-Term local currency rating to ‘CCC’; ‘CCC+’ Foreign; Outlook Negative. Follow the link to understand the definitions of the S&P credit ratings. The CCC credit rating is defined as:
An obligation rated ‘CCC’ is currently vulnerable to nonpayment, and is dependent upon favorable business, financial, and economic conditions for the obligor to meet its financial commitment on the obligation. In the event of adverse business, financial, or economic conditions, the obligor is not likely to have the capacity to meet its financial commitment on the obligation.(p.5)
Barbados Underground was criticised by a few because we did not post a blog to share the news of the downgrade on Wednesday (27 September 2017). Barbadians are experiencing ‘economic fatigue’ after 7 years of a protracted anaemic economic performance. Even if blame is ascribed to BOTH political parties for the island’s poor economic performance, it does not change the reality for the majority of Barbadians. Perception is reality and the reality (perception) is that we have become trapped in the economic headlights like the deer.
Confirmation of the degree to which the leadership of the country is locked in old thinking was confirmed yesterday by acting Prime Minister Richard Sealy. During an address to DLP faithful at party headquarters he lauded the increase in tourism arrivals year over year. He shared the news that a few local tourism players will be renovating or adding rooms to the plant. He also shared that the Hyatt hotel developers will start construction in a couple weeks. The BU household is of the view the Hyatt matter is the subject of a court action. Isn’t the construction of the Hyatt before the court because citizen advocate David Comissiong has filed for a judicial review? Did acting Prime Minister Richard Sealy disrespect Barbadians and the Barbados courts with his glib announcement that the Hyatt will break ground in two weeks?
Listen to acting Prime Minister Richard Sealy with 8min:34sec to go on the video. Did he mention that the Pure Beach property is still in play? Really acting Prime Minister Sealy?
Did Sealy also demonstrate ignorance with his reference to increase tourist arrivals as a measure of success in the sector? Has the more accurate measure shifted to dollars spent (ave$spend) by the tourist as the best performance indicator to measure success in the hospitality sector? Why have we not seen significant positive movement in foreign currency inflow net of FDI? Was Sealy’s measure of success debunked by former minister of tourism Vincent Vanderpool. Also, if Sealy is a student of the marketplace he should have taken note of an address former Prime Minister Owen Arthur delivered a few years ago at the Errol Barrow Creative Centre, UWI, Cave Hill. Arthur was clear to point out that tourism as a single sector CANNOT generate the economic growth Barbados needs to pay its bills.
What is obvious is that this government will continue to make political decisions. Let us send up the prayers that we are are able to limp along until the Prime Minister gives the people the opportunity to exercise the right under the Constitution to select the political party of our choice.