Governor of the Central Bank of Barbados Cleviston Haynes delivers the Central Bank of Barbados’ review of Barbados economic performance in the first half of 2019 and takes questions from members of the media.
Economic Review of Economy – January to June 2019
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136 responses to “Economic Review of Economy – January to June 2019”
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@David
” On what basis would the creditors demand 100 of outstanding if it would force the economy to tank?”On the basis that their owed the f…in money. Barbados bragging about all the forgien currency reserves they have is one incentive for these debt holders to demand FULL IMMEDIATE PAYMENT. Unfortunately these off shore debt holders are not normal DUMB BAJAN local debt holders.
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@David.
First the creditors don’t care about our economy they want their shareholders money. The effect it would have on us is our problem. When Courts send the marshals for your unpaid for bed, you think they care where you going sleep tonight?
We have 2 debt issues here now. The foreign debt balances and how they will view the debt run up over the last 18 months under the old agreement. No bank is going to wipe the slate of the 18 months of accrued liability without expecting some payment on it, even if it’s 50 cents on the dollar, even though they are entitled to the whole dollar.
My point is we owe hundreds of millions in unpaid debt yet the governor has made no provision on the reserves for debt service. To walk about saying you are a millionaire when you owe away half a million in unpaid debt is therefore ludicrous for a man to do far less a country!
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@John A
Do not agree with you this is how external creditors operate. There is precedent setting behaviour to support.
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@ David
So you think the mouthing of Persaud is an example of how external debt holders should speak after 18 months of not paying a blind cent?
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We seem to forget we signed for and took an agreed amount and hence we owe the creditors every blind cent. If they choose to negotiate on that say thank you. They are not legally obligated to negotiate and have every right to demand full payment so don’t let Persaud and them talk RH like ” we feel we are in a strong place to negotiate from.”
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@John A
Just saying to publicly provision for any amount would prejudice the negotiations between WO and the creditors.
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@ John A August 11, 2019 10:07 AM
That’s what a ‘contingent liability’ is all about.
Even if the provision is based on, not what is fully legally owed, but on what the Bajan government (on Persuad’s advice) is prepared to pay to remove this monkey from the back of the country’s future capacity to borrow to maintain its high standard of import-based conspicuous consumption lifestyle and its ability to improve the credit rating status in order to attract the kind of FDI required to build its much touted hotel corridor as the engine of future economic growth.
If we are to dismiss the high probability of financial gerrymandering to meet the window-dressing for political propaganda purposes we can only assume that both the guv and his master puppeteer the MoF appear to be way out of their depth on this rather serious matter of international finance.
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@Miller
The government is obviously using the one billion reserves to feed public confidence, you will agree this is an important behavioral factor in engineering consumer confidence?
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@ Wily Coyote August 11, 2019 4:20 AM
If we chase 50 percent of all bureaucrats off the island, we can cut taxes by 50 percent. We will then definitely experience an economic miracle.
So there are 10,000 to 15,000 civil servants between us and the revival of the island. For 50 years they had a carefree, stress-free life at the taxpayers’ expense. It is time for them to emigrate to Costa Rica or Guyana.
Every company that has 50 percent ballast on board must discard it, whether before or during insolvency. It’s like a hot-air balloon. You throw off ballast to ascend.
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@ David August 11, 2019 11:01 AM
“The government is obviously using the one billion reserves to feed public confidence, you will agree this is an important behavioral factor in engineering consumer confidence?”
++++++++++++++++++++++++++++++++++++++++++++++It’s nothing but fool’s gold! Barbados needs to bite the bullet and deal with reality instead of living in a bubble of the pipedream of living above its means.
Isn’t this another interpretation of that laughable but rather appropriate analogy of the government spinning tot in mud or running around like a black cat in a dark room while being chased by 26 blind men and women in a Cabinet not knowing their elbows from their arses?
The government is looking for a good excuse to make the Bajan dollar find its real value in the market place.
Let the people blame the foreign creditors for the pending across-the-board devaluation of their standard of living with the mickey mouse dollar the rat which upsets the ‘golden’ applecart.
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@Miller.
Yrs I agree with you 100 percent. We could of picked up an amount say 60% of what was due in payments over the 18 month period and placed that amount as a pending payable against foreign debt settlement. Anything like that I would of agreed with. He could of said to us ” look we got $1.2b in reserves but we owe on it so I going book $300m for debt service. To just totally neglect debt owed and not make a provision for it is totally unacceptable and would not be permitted by any accountant firm in a financial statement.
Why then should we accept such on the greatest financial statement which is that of the central bank?
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@Miller
You avoided the question. How important is stoking and managing consumer confidence.
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@John A and Miller
You have peruse the central bank report at page 19 when represents total debt outstanding?
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@ david.
Recognising debt on page 19 and not making a provision for it in the reserve net balance is nonesence. So what he going do show a massive loss of reserves in next year’s report when money for to get paid out?
Total madness
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Meant got to get paid out
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@John A
How would you advise government to provision for it?
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The reserves are in hand!
There is not a schedule as yet for the (restructured) debt to be paid.
When there is a schedule in place then the CB can make provision for allocating amounts for the due dates.Some of us would like different but it is not necessary. What is necessary is to report the facts not to speculate as to the outcome of the negotiations.
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@ David August 11, 2019 11:25 AM
Which is more important at this stage of the country’s financial health?
Consumer confidence or foreign investors’ confidence?
Where is the foreign money going to come from in order for consumers to actualize their consumption desires for imported goods and services?
From Mark Maloney and his Hyatt pipedream?
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@Miller
The foreign investors are aware we have defaulted (SD). What we must do is close the negotiations as soon as practicable. Whether we estimate some unknown number will not influence the level of reserves.
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The governor gave a REVIEW of the ECONOMIC PERFORMANCE for the first half of the year.
Its a review not a budget.
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@David.
Let me put in plain English here for those that either do not understand basic procedure, or for political reasons choose to ignore it.
The governor is reporting on the period January to June during which the repayment of debt liability was encured, it was not paid hence a provision must be made for it. Added to that he has an unpaid liability for last year that has not been paid either that must be accounted for.
Let’s say the total liability for this period came to $400M for purpose of discussion, any accountant firm would FORCE their client to pick it up as a payable due. That is financial fact not fiction or financial yardfowlism. Debt don’t just disappear from financials because we chose to ignore it, or because we haven’t agreed to pay it either in part or in full!
Now if we are so sure that we are nice people that we will be forgiven half of this because we have such good negotiators, we should have at least made a provision against the reserves for $200m. Remember doing this would not have been permitted by any accounting firm, but because we are Bim and are different to everywhere else in the world, then we should of made this provision against the reserves at the very least.
Now bear in mind the longer Persaud et al drag their ass on the payment agreement, the liability post default is growing, hence the need to make provision for it becomes greater. The cost of unserviced debt doesn’t remain stagnant because we choose to ignore it. Don’t pay your credit card on time and see what happens.
David this is not a small payable that you can slide under ” miscellaneous” but a substantial and growing amount due in total under a sovereign agreement.
So those that want to bend global accounting practices for purpose of yardfowlism carry on smartly. As Miller said you fooling yourselves you got reserves that are propped up by fools fold.
I would happily discuss this with anyone using arguments based on global accounting and financial practices. For the others who say Bim different, direct those views to the next showing of Laff It Off.
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Lol show me a budget that got in income and not expenses and liability.
Lord I deading here 😂😂
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@John A
Assist a simple blogmaster.
Are we discussing the Bugetary Proposals or the appropriations Bill.
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Is there a difference between REVIEWING (looking back) of the economy for quarterly reporting purposes and the REVIEWING of the economy for budgeting purposes (making adjustments)?
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@ David
We can argue about the amount to provision for the debt repayments due to the external creditors.
What we can not argue though is that the true level of foreign reserves is less than the headline figure being bandied about by the Guv. Therefore the chest thumping around this is totally misleading.
So your assertion that “whether we estimate some unknown number will not influence the level of reserves.” is patently false.
Besides, though the exact figure is not known due to the ongoing negotiations, there is a known range which is easy to calculate given the views of the two counterparties.
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@Dullard
The point was made that the central bank review list total debt outstanding which will have to be paid from the reserves. It is as simple as that.
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@ David.
We are focusing of the central bank report.
Ok in past years when we were servicing our debt the repayments would have been made hence reducing the reserves automatically. So when the governor reported on reserves at June 30th say, the figures he would of quoted would already of had the loan payments taken out, hence the reserve figure given at June 30th would have been factual. Agreed?
Now let’s move to post default reporting. The payments on the loans were not being made as this was after we defaulted. The reporting system would never have encountered such a situation before because we always paid our debts. So for the first time the governor is faced with what should have been the creation of a new line under the reserves, let’s call it ” pending liability post default “. So for the reserves to show reality to us the public post default im the report, they should have been shown something like this.
Total reserves. 100 dollars.
Pending liability 20 dollars
net reserves. 80 dollarsThe problem is that prior to the default the format the central bank report used was fine. For the first time in our history though we now have a new issue. The issue of unpaid loans under the review period.
So to state to the public that our reserves as shown above are $100, when in fact they should be $80, is misleading to say the least and inaccurate to say the obvious.
Also remember in the absence of a new debt repayment schedule we are legally bound to the existing loans. The central bank if those loans were paid, would of deducted the payments from the reserves prior to reporting. Agreed? So why are they not now showing these said loans as due then in the same report ? Did these loans suddenly disappear from our books just like that “Poof”?
The facts are under our current loan agreements the unpaid loans over the last 18 months are a legal sovereign outstanding liability and must be therefore made provision for in our reserves. If we are fortunate enough to negotiate a reduction in these loan balances to say 60 percent of what they now are, then next year’s report would then reflect this adjustment to the pending liability owed.
People seem to want to forget the central bank report is the report on our financial performance and cheque book balance in simple terms. It must therefore give the most accurate account of our true position to every Bajan as a shareholder in our islands financial position. They are therefore duty bound to not only show debts serviced, but also those they were directed to ignore by our learned advisors on the debt restructuring committee, unless of course Persaud can present a letter signed by all foreign creditors stating all debts have been forgiven!
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@John A August 11, 2019 10:07 AM
I would expect the loan payments to be in accounts payable unless the financial statements were prepared by a book’s cooker – lol
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@John A
Your position is respected.
The governor must be aware of the state of negotiations and felt comfortable gliding over this matter in the half year review.
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@ Bajan in N.Y
You too bad for true. Lol
You like the young chef that tell the master chef he had nuff experiencing in cook, when asked what he said ” his father’s book.”😁
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@ David.
No the governor has a responsibility to report based on what the facts are at present. He must therefore report based on current loan liabilities until such time as new loan agreements are in place.
It’s like you having a $2000 a month mortgage but are in negotiations for a lower payment of $1800. The point is until the $ 1800 is approved and implemented you are legally obligated to pay the $2000 a month and show that as current liability.
What the negotiators do or in this case don’t do, have nothing to do with the central bank accurately reporting on our true position based on current liabilities.
All the talk about not doing it so as not to affect negotiations is bare bird droppings. Any foreign creditor who looked at the report were the current loan payments shown as outstanding, would quickly say ” ok they have at least shown their old loan payments that we are hoping to negotiate on.”
You don’t think that would of given them more comfort than not showing a red cent as a provisional payment?
Sorry ain t giving the governor no pass there on that red herring for an excuse. That Koolaid glass can stand right there!
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@ John A
Dr Worrell is a key adviser to the foreign creditors and he knows the internal workings of the central bank. What do you think he tells his clients? Do you think such tinkering with the numbers will fool Dr Worrell? Only the public are misled.
I have called before for the central bank to make public its methodologies. If I want to know about the current account of the US economy or the UK economy, I won’t go to the Fed or the Bank of England. We need a reformed and independent central bank, but our politicians like power. -
@John A
You recall when the former Governor rubbished the unemployment stats produced by the BSS and did his own survey?
There must be precedent which gave comfort to Governor Haynes.
#justsaying
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@John A
You have heard the stories about former Governor Worrell sitting at his desk with a calculator crunching numbers produced by his analysts?
#comical
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@ Hal
That is my point exactly. You may be able to fool some of the Koolaid drinkers and party faithfuls with this nonscence report but all like now the goodly doctor on his Casio calculator there doing just what I was asking for . He there adding away with $1.2 b minus what due under loan A and B for the last 18 months equals.
I just find it unfortunate we as a people are given such a report and don’t challenge it and ask for certain critical data to be included. The handful of us that do ask are too small to force change too I guess.
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@ David.
The thing is though no matter how you play with numbers certain data can not be altered such as loan balances and dates.
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@John A
Let us see how the Governor and WO resolve the issue. We must be confident they have a plan. They are being paid big Rh bucks.
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@David
You know the reason i take time to explore issues with you here is not for the benefit of we old men like myself, Hal, William and Vincent. We have played our innings already. It is my hope that it will encourage younger people to start digging deeper and asking questions. We want the young ones to start thinking for themselves and not swallowing whole what they are told. We need those in their 20s and 30s to hold those in power accountable. If that is done effectively they become the watch dogs of our economy, hence replacing the opposition and press who have dismally failed us.
They are the ones whose voices we want to encourage here. If they come and seek clarity then let us help them and not criticise them back into silence.
Mind you we old men don’t plan to hang up the keyboards just yet so don’t get wunna hopes up! Lol
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@John A
History reveals that well functioning societies of the past respected mechanisms to transfer knowledge from the seniors to the younger folk.
You may be aware this blogmaster respects your view. Cannot say the same for others LOL.
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@ John A
The trick is to make a bold statement, such as a quarterly/half yearly report, and then refuse to enter any discussion. If you do not answer questions you cannot have your argument dissected. I call it the Bajan Condition. It is the weakness of learning by rote; once you have said your bit there is nothing else to say.
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@ David.
Thank you. The beauty of getting older is you don’t give a rat’s ass anymore about those that have a problem with what you say. Lol
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@ Hal
That sound to me like “The Hitler Approach” and that didn’t end will for him or the people in Jonestown.
I have noticed that though and what has become very apparent with these new politicians especially those now in opposition, is that they question nothing!
You think if you had men in opposition today like Tom Adams, Barrow or Owen this Central Bank Report woundnt of been torn apart by now! I could hear Barrow now “fellows you forget to include the debt what happen?” Then he would of went on to paint their tail. Or Tom with his dry sense of humour “really gentleman what have we done here?”
This group is a sad and dismal failure like the press when it comes to the public’s enlightenment.
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A couple of years ago I posted this positive documentary reportage from Aljazeera about Barbados. What became of those individuals who were featured in it?
https://www.aljazeera.com/programmes/earthrise/2014/12/barbados-goes-green-2014122185541151944.html
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The beauty of getting older is you don’t give a rat’s ass anymore about those that have a problem with what you say. Lol(Quote)
Well said. You could not careless about a beauty parade. You don’t want to be Mr Popular. Respect to rats.
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TABLE 6 – PUBLIC DEBT OUTSTANDING.
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Click to read text of Barbados Review of the Economy January to June 2019.
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Our Blogmaster, David, is acting like a MORON with respect to Financial Book Keeping with respect to Assets and Liabilities, he’s a prime Bajan example of what has led to the Countries FAILED STATE STATUS.
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John A everyday you on here talking about paying back external creditors .My queztion are you one or are you Dr Worrell? The creditors will be paid in due course, when a mutual agreement is reached between Barbados and them not before so rest yourself and stop the speculation and gloom and doom everyday.It is becoming tiresome and gives the impression you have an agenda, which personally think you do.
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@ Lorenzo
Just like you and others are apologist for the party my sole interest remains that of the country. I really don’t care to enter into any discussion with blind loyalist like yourself as a result. As I said before I help vote David in and Freundel out. Thankfully I was not born a sheep.
If being pro state means being anti-party then please sign me up right away as parties will come and go but our island hopefully will outlast all of them.
If you can’t discuss issues based on facts without dragging party politics into every dam thing, then please dont waste my time responding to my comments, as this is the last time I will respond to yours as long as yardfowlism is at the root of your response.
I leave you and others be they B or D to partake in acts of yardfowlism and party propaganda. May the sheep continue to graze in the propaganda of their divine shepherd. Lol
The blogmaster invites you to join the discussion.