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Barbados Public Debt to GDP 1980 to 2012

by Amit Uttamchandani of caribbeansignal.com

The objective of this post is to locate, explore and compare/contrast historical public debt to GDP data for several Caribbean countries.

First, we have to find the data: The Google query “debt to gdp imf” brings us – ironically – to the IMF (Barbadians take note). In particular, this page: “A Historical Public Debt Database.” The IMF’s data set contains public debt to GDP data for 170+ countries going back as far as 1692 all the way up to 2012. The second step is to extract Caribbean countries that are of interest to me (including Barbados) and a time period of interest to me (1980 to 2012). The third step is to pull the data into Excel and build a few charts.

Here is what 32 years of public debt to GDP, expressed as a percentage, looks like for Barbados:

Here’s the same chart but with red and blue lines added in at specific years (WARNING: Correlation does not imply Causation). I will leave it to the reader’s imagination to infer what these lines mean.

My next post will look at several other Caribbean countries.

119 responses to “Barbados Public Debt to GDP 1980 to 2012”

  1. Bernard Codrington Avatar
    Bernard Codrington

    It is noticeable that the low ratios of Debt / GDP coincide with the years the BLP are in office. Coincidental ,my dear , Watson?

  2. David Avatar
    David

    @Bernard

    Is it possible to identify a story behind the spurt in debt during the DLP years?

  3. Bernard Codrington Avatar
    Bernard Codrington

    @ David at 7 : 36 PM

    Of course one can create any number of stories to explain the rises in the ratios of Debt/ GDP. But then we will be moving into the contestable area of “Post hoc, ergo propter hoc.” Literal translation of which is “After this ,therefore because of this.” The author of the submission cautioned against jumping to conclusions .

    I know that you have your own story. Do you really need mine?

  4. David Avatar
    David

    @Bernard

    We need all views especially given you probably have the training and ‘memory’ to do a better job.

  5. Artax Avatar
    Artax

    Since were are “discussing” debt……………

    ……………..I understand, from usually reliable sources, the Transport Board bought a few buses (from the Chinese??) to work in the Port for tours. They are painted blue and yellow, with a large trident at the rear and “Transport Board” written at the top.

    BM338 is currently being prepared for “duty.”

    However, we prefer to discuss Mottley and the LEC.

  6. Tron Avatar
    Tron

    The charts do not cover debt of statutory corporations (eg NHC) and the present situation.

    What should I say about the execessive debt? The looming bankruptcy and internal devaluation are the price for “independence”, where socialist politicians out of the bushes play with the lives of many. Barbados is a country where hard drugs from Black Rock are cheaper than food. Sad.

  7. John Avatar
    John

    Bernard Codrington November 27, 2017 at 7:21 PM #
    It is noticeable that the low ratios of Debt / GDP coincide with the years the BLP are in office. Coincidental ,my dear , Watson?
    ++++++++++++++++++++++++++++

    Perhaps the debt was cancelled by selling off assets!!

    The assets continued to contribute to GDP.

    So the ratio fell!!

    Perhaps the old “selling off the family silver” trick!!

    When were state assets privatized?

  8. Bush Tea Avatar
    Bush Tea

    Arthur was good at playing around with the numbers.

    BOLTS also played a role in hiding REAL national debt.
    The DLP simpletons came into office after these were criticised, and ‘brought to books’ all the mind tricks that Arthur had instituted, and which were beyond their simple minds.

    Looking at the charts now, people like Gabriel and enuff will do dixie, but William’s and Grenville’s are the correct prognoses here….

    This is collective BLP/DLP idiocy.

  9. Bernard Codrington Avatar
    Bernard Codrington

    @ John

    @ Bushie

    There are no tricks .The statistics were compiled on the same basis.And by the same technocrats and reviewed by the same external evaluators.

    Prime Ministers and Ministers of Finance do not compile statistics. They “explain them”.

    Bush Tea

    I think you owe it to the BU household to spell-out what BOLTS mean and how it is possible to hide National Debt there in?
    @ David

    I hope you understand what I mean when I say anybody can write his story around statistics. They take on various significances according to what the interpreter wants them to say.

  10. Bernard Codrington Avatar
    Bernard Codrington

    According to the statistics provided, there should be no doubt that the economic affairs of Barbados were better managed under the BLP than under the DLP in the years covered by the charts.
    In a small open economy the important lever is the Balance of Payments . Policies relating to economic structure,and tax incidence must be formulated with an eye on the impact that policies will have on Barbados’ ability to export and import. The BLP has done this quite well in the past. This is no time for experimentation with the untried.

    Of course the environment has changed and new goods and services with high market value must be produced. We must choose which end of the market will be more beneficial to Barbados. Cottage industries and services are not the most viable options. We must go up market in order to maintain our high standard of life.

  11. Bernard Codrington Avatar
    Bernard Codrington

    A country,like an individual,incurs debt to bridge a gap where its income falls short of its expenditure . It is intended to be a short term measure. Obviously the BLP administrations were able to retire their debts ,even those hidden in BOLTS.

  12. John Avatar
    John

    A country,like an individual,incurs debt to bridge a gap where its income falls short of its expenditure . It is intended to be a short term measure. Obviously the BLP administrations were able to retire their debts ,even those hidden in BOLTS.
    ++++++++++++++++++++++++++++++++++++++

    You got it, which means everybody got it too!!

    The underlying problem remains like an elephant in the room.

    Output and rising borrowings to address the deficit!!!

    Except the gap is never bridged!!

    Neither party has been able to get growth in output for the simple reason that they are not doers, they are hangers on, parasites.

    There really isn’t anything to manage so neither one can claim to be good managers …. simply an illusion.

    The people who create the opportunities for economic growth are not in Government.

    It is these people who we have always needed.

    So, we are back to the old selling off of assets, this time, the BNOTCL about which David Commissiong is jumping up and down.

    If DLP sells off the BNOTCL, then the when we look at the graph in the future we will be able to say we were blessed by two sets of good managers!!!

    Except by then everything may have collapsed under the weight of the rising debt!!

    An alternative of course is the IMF, perhaps the only one if we don’t address the old output elephant …. that should make DC go ballistic.

    … and that’s the problem with the third or fourth or fifth party …. like the B’s and D’s, no doers, no plan or possibility for “making Barbados great again”!!.

    Everybody knows or senses that … that’s one of the reasons why Trump won in America!!

    America has the same problem, growing debt, falling output.

    Under Obama, the debt rose more than it did under all of the preceding presidents … combined … but through slight of hand and a favorable press, Obama is not viewed in a negative light.

    Kind of like the B’s and D’s except America now has Trump.

    He is guaranteed to excite hatred because he forces people to forget the pie in the sky and rubbish of the left and deal with reality!!!!!

    That’s part of his strength with his base of supporters and the Democrats are not going to get there in any hurry … they are stuck in the past.

  13. John Avatar
    John

    Of course the environment has changed and new goods and services with high market value must be produced. We must choose which end of the market will be more beneficial to Barbados. Cottage industries and services are not the most viable options. We must go up market in order to maintain our high standard of life.
    +++++++++++++++++++++++

    Pie in the sky … sounds good but not going to happen with the current thought processes.

  14. Artax Avatar
    Artax

    John November 28, 2017 at 6:11 AM #

    “If DLP sells off the BNOTCL, then the when we look at the graph in the future we will be able to say we were blessed by two sets of good managers!!!”

    @ John

    Is it possible for you to explain your above comment………. because it does not make any sense.

    If I progressively incur debt of $100,000 over 3 years, for example, and subsequently sold my house to pay off that debt, the graph indicating my debt levels would remain the same.

  15. Artax Avatar
    Artax

    John November 28, 2017 at 6:11 AM #

    “He is guaranteed to excite hatred because he forces people to forget the pie in the sky and rubbish of the left and deal with reality!!!!!”

    @ John

    Are you really referring to DONALD TRUMP?

    The same Trump who accused Obama of playing golf despite all “the problems and difficulties facing the US,” and is now on target to triple Obama playing 333 rounds of golf in 8 years?

    The same Trump who to date has played 35 rounds as compared to Obama’s 24 over a similar period?

    The same Trump whose security costs has been escalating (at tax payers’ expense) because he spends most of his time at resorts owned by him?

    Wasting tax payers’ money is a reality that Americans have to deal with.

  16. Peter Thompson Avatar
    Peter Thompson

    @Bush Tea, you say that “Grenville’s are the correct prognoses here….”
    Let’s do a quick “back of the napkin prognosis of debt under Grenville’s published policies…
    1. Forgive $1 billion in tax arrears = $1 billion added to debt
    2. Repeal NSRL = $500 million/year added to debt
    3. Eliminate corporate income tax = $250 million/year added to debt
    4. Replace 17.5% VAT with 10% tax on corporate revenue = $400 million/year added to debt
    5. Replace progressive income tax with 10% flat tax = $150 million/year added to debt
    6. Refuse to negotiate with IMF to reschedule the $2 billion in external debt coming due over the next 4 years at 5% instead of the 12% to 15% it will cost because of our trashed credit rating = $180 million/year added to debt because of interest costs

    Yes, Grenville has “the correct prognoses” about the past because he is facing backwards to cuss the BDLP instead of facing forwards to calculate the effect of his proposed policies.

  17. Peter Thompson Avatar
    Peter Thompson

    The current debt/GDP ration is at least 110%… off the scale at the top of the graph

  18. Sargeant Avatar
    Sargeant

    @John
    Under Obama, the debt rose more than it did under all of the preceding presidents … combined
    ++++++++++++++
    Was that in one term or two? This assertion started with a chain email and was picked up by right wing/conservative blogs and has been disproved time and time again but is regurgitated because “it is on the internet”. As I said before you are more credible when you write about swamps, cemeteries and graveyards. When you venture into the realm of American politics you tend to favour the sites that are racist cesspools with a political slant.

    About that “pie in the sky”, that works for the 1%, the other 99% will have the reality of the old sleight of hand when it comes to tax reduction “now you see it now you don’t”.

  19. Wily Coyote Avatar
    Wily Coyote

    LIARS FIGURE AND FIGURES LIE, case closed.

    BARBADOS as a country is now FAILED, think Mugabe.

  20. de pedantic Dribbler Avatar
    de pedantic Dribbler

    @Sergeant, pellucid n accurate. When the blogger ventures into US politics he clearly shows his bias.

    One can actually acclaim Trump on his winning achievements in business n now in politics but that must be placed in a single silo acknowledging his determined, unconventional, never-say-die style.

    But to acclaim this man as someone who “… forces people to forget the pie in the sky … and deal with reality” is extremely disingenuous or bluntly said, simply another set of trumpian lies and BS.

    What amazes me on this blog are the number of highly educated people who display an unbelievable hypocrisy …on one set of subjects they offer sterling research and analysis and on others display very biased, poorly affirmed prognostications.

    And then we critic the politicians and their shifting views so vehemently. What a mess of cold porrige!

  21. SETH Avatar
    SETH

    Turn out the lights the party is over.

  22. Bernard Codrington Avatar
    Bernard Codrington

    @ David

    I hope you are learning fast. Do you see how somethings that are supposed to be objective and neutral can be interpreted according to the bias of the viewers .
    Check John’s interventions. They even betray his ignorance of simple arithmetic.
    Ignorance may be interpreted both ways:
    ( 1 ) deliberately not seeing because he does not want to see.
    And
    (2) lack of knowledge of the computation process.

  23. David Avatar
    David

    @Bernard

    It makes one question if there is ever a correct view.

    >

  24. de pedantic Dribbler Avatar
    de pedantic Dribbler

    Lolol wildly @Bernard. You missed your calling brother. We know you as a public Bajan official but surely you should have been on the political hustings more directly…what lovely politically correct palaver @ 11:39.

    Do excuse my ‘pedantry’ but this man is a Bajans scholar from HC in math and science no less so it can’t be #2 and frankly should not be #1 either…

    In sum, you either just cussed our vaunted education system comprehensively or called this gentleman an extremely bad word…in the most erudite way possible.

    I presume that comes from writing under ur own name…yah can cuss a fellow bad as shiiiite but real decent tho. 😁

  25. Bernard Codrington Avatar
    Bernard Codrington

    @ David at 12:04 PM

    Let me borrow a” whoring trick” from Jeff. Now, you are not to infer that Jeff is a bad word.

    When it was a scientific truth that the world was flat,that was the correct view. It squared with the observable evidence. It prevented many African brothers from ending up in the Americas ,if they survived hunger ,thirst and drowning.
    When the earth was viewed to be the centre of the Universe , that was the correct view . It was satisficing to the majority of observers and made good common sense. And I can go on and on.

    Suffice it to say that what makes sense to the majority is correct,temporarily. Do not hurt your head. Just support the position which is more likely to deliver what is reasonable and possible.

  26. David Avatar
    David

    @Bernard

    What your comment exposes is the natural tension between the philosophical and the need to be pragmatic. It defines every day existence.

  27. Hal Austin Avatar
    Hal Austin

    Bernard Codrington November 28, 2017 at 12:25 PM #

    @Bernard,
    Read the debates between Zeno and Aristotle and refresh your reading on inductive and deductive logic. ie all good men are educated; Joe Bloggs is an educated man; therefore Joe Bloggs is a good man.

    @Bernard, a Good book to read is G>E>Hardy’s A Mathematician’s Apology.

    .

  28. Bernard Codrington Avatar
    Bernard Codrington

    Hal Austin @ 1 :12 PM

    Thank you , Hal. Actually ,since joining the BU household I have found it necessary to review my knowledge of statistics and scientific methods.To my knowledge of inductive and deductive logic I have added reductive logic.

    In my discipline I also learnt that they are limitations to the use of Mathematics. If you do not understand what the maths does not say nor cannot say you will come to some very strange conclusions. Strange in the sense of repugnant to commonsense. But mathematics is necessary ;hence its inclusion in” albino centric” education. By the way Mathematics originated in the horn of Africa and reached Europe through Greek occupation of Egypt.

  29. Hal Austin Avatar
    Hal Austin

    @Bernard,
    Absolutely. But for all kinds of reasons, Africa has been written out of the history of mathematics. You may note that all the significant ancient mathematicians either worked in Alexandria or inherited many of their ideas from people who lived and worked there.
    To my mind, the philosophy and history of mathematics also omit any mention of Timbuctoo.
    There is a lot to talk about regarding mathematics, but, as usual, the victor writes the history.
    .

  30. Bush Tea Avatar
    Bush Tea

    @ Bernard
    Bushie….I think you owe it to the BU household to spell-out what BOLTS mean and how it is possible to hide National Debt there in?
    +++++++++++++++++++++++++++++++++
    Bushie could NEVER do it as clearly and concisely as you could…
    But since you wouldn’t….

    It is like a man needing to own a house for his family to live in, but he has already overstretched himself buying the benz, Landrover and shopping in Paris.

    Instead of going to the Bank, he calls a friend with lots of extra cash (like Bushie) and invites this friend to build the house – on his land – and to lease him the house for 30 years – doing all the maintenance and upkeep in the meanwhile.

    The lazy-ass bum then gets to ride around in the big rides -WHILE enjoying the posh house – and while his mortgage account at the bank ONLY reflects the big rides….so no devaluations.

    OBVIOUSLY, in reality, he OWES this ‘friend’ for the house too, but is happy to pay the lease THROUGH HIS NOSE, while kicking the loan accounting down the road…. and fooling the IMF etc with the low mortgage balance.

    Lotta shiite tricks….. adding more OPERATING expenses while OVERBURDENING the capital exposure…. and fooling the brass bowls with graphs like those above….

    Such should be considered treason, and deserving of Pachamama’s toy guillotine……

  31. John Avatar
    John

    If BNOTCL was sold, it would not vaporize, it would continue to contribute to the GDP.

    However, the GOB would have money to “retire” some of its debt!!!!

    So the debt would fall.

    Ergo, the ratio of debt to GDP would also fall.

    So under the DLP you should see a dip in the graph once the proceeds are put to retiring some of the debt.

    Ideally, the ratio of debt to GDP should be falling.

    Money is borrowed to increase output.

    But output is not increasing.

  32. David Avatar
    David

    @John

    The wrinkle in your view posited is that the rampant consumption behaviour that has driven us to the current state will change after the proceeds are deposited in the deep hole.

  33. Artax Avatar
    Artax

    @ John

    Please tell me at what institution you learned economics/accounting.

  34. John Avatar
    John

    A lunar eclipse displays the curvature of the earth.

    Anyone who watched an eclipse would know the earth was curved without embarking on a sea voyage.

    Since we all agree that people have studied astronomy for centuries before 1492, it is pretty obvious that the current belief that people thought the earth to be flat before Columbus is pure rubbish …. a myth.

    It isn’t necessary to have a telescope to watch the shadow of the earth on the moon in an eclipse!!!

  35. John Avatar
    John

    David November 28, 2017 at 3:30 PM #
    @John
    The wrinkle in your view posited is that the rampant consumption behaviour that has driven us to the current state will change after the proceeds are deposited in the deep
    +++++++++++++++++++++++++++++++++++

    We are discussing a simple ratio, debt/gdp!!!

    We are looking at a graph of this ratio!!!

    This is simple arithmetic!!

  36. John Avatar
    John

    Artax November 28, 2017 at 3:35 PM #
    @ John
    Please tell me at what institution you learned economics/accounting
    ++++++++++++++++++++++++++++++++++++++++++++++++++

    University in the Mother Country!!

  37. John Avatar
    John

    There was never scientific proof the earth was flat!!

    Exactly the opposite, people knew from the year dot by simple observaton!!

  38. Bush Tea Avatar
    Bush Tea

    @ Artax
    Please tell me at what institution you learned economics/accounting.
    ++++++++++++++++++++++++++++++++++++++++++++++++++++++++
    A non-point if EVER there was one…

    Some of the VERY best accountants/economists(whatever the Hell THOSE are..) are simple housewives blessed with common sense.
    Some of the VERY worse seems to have graduated from Cave Hill ..and cannot run a coconut stall successfully.

    @ David
    Excellent point.
    When they sell the BNTCL, they will simple pay RECURRING expenses with it (what pay down what debt what??!!) to buy some time until they are out of power and no longer responsible.

    It is like the shiitehound in Bushie’s example to Bernard then looking to use the ‘slack’ provided (by not needing a direct mortgage for his home) to buy a bigger TV instead of paying off the Benz and Landrover… and reducing his indebtedness.

    The parros just want ‘THINGS’.
    They care NOTHING about the bottom line.

  39. David Avatar
    David

    There is the saying that a lil learning is a dangerous thing.

  40. John Avatar
    John

    It is noticeable that the low ratios of Debt / GDP coincide with the years the BLP are in office. Coincidental ,my dear , Watson?
    +++++++++++++++++++++++++++++++++

    It is a simple arithmetic ratio …. elementary!!!

  41. John Avatar
    John

    When the BNB was sold, it did not disappear, it still employed persons, still provided banking services etc etc.

    Its contribution to GDP remained.

    Again, the GOB came into cash which it could have used to “retire” its debt!!!

    Retire sounds so respectable!!

  42. Hants Avatar
    Hants

    ” North Korea launches new ballistic missile ”

    Anyone else thinks that “war” is inevitable ?

  43. John Avatar
    John

    Ditto ICBL, etc etc etc

  44. John Avatar
    John

    Hants

  45. John Avatar
    John

    Hants

    Count your blessings!!

  46. Artax Avatar
    Artax

    There would be a temporary reduction of the debt levels, if some of the proceeds from the sale of BNOTCL were used for repayment. But consideration should be given to if the proceeds be used to pay foreign debt or domestic debt, or both.

    However, if (ceteris paribus), the main aggregates of expenditure (investment, consumption, government spending and net imports) and the other economic variables remain constant, as well as expenditure continuing to exceed revenue, then to assume the debt is being efficiently managed under any administrtaion, is stretching it a bit.

    Bush Tea

    We all know you love to OPPOSE certain categories of people……….. but John’s explanation is shiite, and does not have anything to do with housewives, which is also “a non-point, if there ever was one.”

  47. David Avatar
    David

    This is the story of the graph for BU, we repeat the mistakes of the past.

  48. John Avatar
    John

    There would be a temporary reduction of the debt levels, if some of the proceeds from the sale of BNOTCL were used for repayment
    +++++++++++++++++++++++++

    Like pulling teeth!!!

    See how simple it is!!

    That’s what you see in the graph in prior years, a temporary decrease in debt!!

    It is possible that GDP (output of goods and services) rose but then you would have to explain why it fell and caused the ratio to go back up.

    Fit a straight line to the graph, ignore the falls and rises and you will see the trend is UP!!

    That is the issue!!

  49. John Avatar
    John

    … the only one!!

  50. John Avatar
    John

    And that trend explains reflects the extent of the failure of Barbados.

    I would be shame to admit I was a B or a D!!!

    I am not either, thank God so I don’t need to go through contortions trying the defend the indefensible!!

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