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Barbados Economy and Covid 19 in 2021

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The BU COVID 19 graphs (Thanks to Lyall Small for your sterling effort to the cause) continue to show Barbados authorities and PEOPLE doing a satisfactory job to curb the number of infections. We have to continue the trend despite the fact COVID fatigue is present. Recent ash fall from La Soufriere has has not helped.

The blogmaster takes the opportunity to caution with the opening of the country- schools and tourism industry- we need to implement conservative protocols. If there was any doubt why the country needs to find avenues to generate economic activity the Central Bank of Barbados first quarter review delivered this week by Governor Haynes is mandatory listening – see also Barbados Outlook 2021.

Attached are the usual weekly charts up to 30th April.  Barbados recorded what might be a significant spike, reported last night, that has been largely attributed to an outbreak at the Psychiatric Hospital.  The authorities have successfully managed several similar spikes this year so it is likely that we should be able manage this one.  However, they should carefully reexamine some of the details of the planned management of the disease over the next 3 weeks or so, especially as related to indoor audience sizes and traditional schools if the spike continues.  Trinidad has recorded a significant spike over the past week or so and their PM has reacted very strongly.  Jamaica has at last started to show a slight diminution of active cases.  Guyana’s cases have continued to increase – Lyall Small.

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139 responses to “Barbados Economy and Covid 19 in 2021”

  1. David Avatar
    David

    De Peiza: Take steps to address revenue generation

    https://www.nationnews.com/2021/04/30/de-peiza-take-steps-address-revenue-generation/

  2. Hants Avatar
    Hants

    Peter Lawrence Thompson’s Welcome stamp idea was put into action and may have paid dividends.

    https://barbadostoday.bb/2021/05/01/2020-was-one-of-the-best-years-for-real-estate-says-one-leading-business/

  3. John A Avatar
    John A

    I hope people take note that the cooperation tax paid nearly doubled even at the reduced rate of 5%. The lesson here for government is if you tax people at a decent rate they will pay it. Maybe they should try the same approach with land tax and get in some money instead of having massive arrears.

  4. David Avatar
    David

    @John A

    The Governor was quick to caution the government in his review that the way to go is not to increase taxes.

  5. David Avatar
    David

    BPSA chief ‘not surprised’ by economy state, worried about outlook:

    https://barbadostoday.bb/2021/05/01/bpsa-chief-not-surprised-by-economy-state-worried-about-outlook/

  6. John A Avatar
    John A

    @David

    An economy in this state of recession needs the opposite to increased taxation. What government needs to do is discount its receivables like land tax arrears and get in cash. They increased land taxes I think 2 years ago based on no logic at all. What you think for example a building in town where no one goes to shop even in good times is worth today? Government needs a serious reality check in several areas.

    Look Friday I went to pay import duty at customs in the harbour. Line outside the building with one cashier working. I left there and went to pay my drivers license at Oistins. Line outside the building cross the walkway to the carpark. We got nuff post offices all over the island why the hell I can’t pay a drivers license at one of them? Then I heard a lady coming out mumbling ” after I wait so long all I get is the receipt cause they can’t give me the new plastic license cause dem ain’t got none.” I didn’t even get out the car and said to hell with that. So then I went to the governmen ezpay site and pay it there and get a receipt. Well down at the bottom dem ask me where I want to collect it from, so I tick a box near me and put in my cell number as dem is to call when it reach. When you feel I will get a call to go and collect it If they ain’t got the plastic cards? Now if that is the case dem couldn’t get a sticker to put over the old renewal date with the trident pun it so it legal? Now I got my receipt that I pay so to rass with that for here. But how if I go away I going present that to a car rental in the USA for example? We can’t get even the basics right.

    So we brek we need money but wherever you go there is nothing in place for government to collect the cash. The whole dam system is a mess. Things could be way better than they are but if you can’t even pay the money into the state due to their piss poor planning you expect different?.

  7. TheOGazerts Avatar
    TheOGazerts

    @lyall
    Good work.
    I see some grey dots. Is that modeling using a simple linear regression? Scroll down to the graph
    https://stats.stackexchange.com/questions/77851/finding-optimal-cutoff-point-with-two-linear-regression-models

    flat, increase, decrease, flat may be a more accurate presentation.

  8. Tony Avatar
    Tony

    The BU COVID 19 graphs (Thanks to Lyall Small for your sterling effort to the cause) continue to show Barbados authorities and PEOPLE doing a (satisfactory) job
    +++++++++++++++++++++++++++++++++++++++++++++
    The word is “exceptional” under the circumstances that includes ash cleanup….

  9. David Avatar
    David

    A good call and one that has been made by many before.

    Symmonds wants UWI pro-MSME research to help policymakers: https://barbadostoday.bb/2021/05/01/symmonds-wants-uwi-pro-msme-research-to-help-policymakers/

  10. angela cox Avatar
    angela cox

    What does the word stimulus mean to govt consultants
    What does the word” jump starting’ in economic terms means to govt
    Asking fuh a friend

  11. NorthernObserver Avatar
    NorthernObserver

    “The lesson here for government is if you tax people at a decent rate they will pay it”
    Very observant of you.
    But if you tax dem nuff, and then sumbody gives you sumting to write it off, the benefit accrues where it is wanted? No money to be had when peeple paying?

  12. ks Avatar
    ks

    More talk, no action!!! The status quo remains…. same old, same old. If I had to vote on the performance of BRA since it was ‘formed’, I would surely vote FAIL.

    Re drivers licenses ….. no plastic card and the photo machine not working. It’s been like that for years! Renewed my vehicle insurance in Oct. 2020, finally got the sticker for 2021 in April 2021. Efficiency at work….lol.

    Government scrambling for cash but our experts/consultants only thinking about more taxes. As @John A mentioned, why not reduce taxes, allowing more money in the hands of the population? They will then spend it and government will collect the much needed cash via their indirect taxes, which is ‘compulsory’ …. can’t be with-held or hidden like income, land, and other taxes!

  13. David Avatar
    David

    They will spend it on imports right? We know what that will mean. There is no one size fits solution here.

  14. Lest we forget Avatar
    Lest we forget

    John A
    You are so right. You have to line up in long lines to pay government fees. You end up getting frustrated and do not pay not because of not wanting to pay. In an earlier blog it was said that government has it priorities wrong. Making payments easier should be one of them. Instead I am now seeing that the Government has set up a new body called Department of Public Affairs headed by Pat Parris as Director. We cannot have a money problem with these actions. By the way have not seen or heard about this in the mainstream press.

  15. John A Avatar
    John A

    @ Northern.

    My view is that all governments have failed miserably when it comes to taking advantage of its added value forms of taxation like Vat.

    If I import an items and government charge me an excessive duty then the item sits on my shelf agreed? But if it can be sold on at a lower cost, where after my markup government collects the valued added portion of my mark up, then we all benefit correct? Plus unlike direct taxation where only the state benefits, an increase in my ability to collect more vat means my sales have increased so I can hire more people.

    Look at most customs warrants and you will see the vat portion is more than the duty portion. So common sense would show if you allowed these to sell in a liquid economy and the business was using a 40% markup, that government would collect 40% more in vat when it sold than when it sat on the shelf.

    The problem is not the system. It is the fact that most governments do not understand the advantage of how value added works. To benefit the items and services have to sell and if you take away the people money on over taxed forms of direct taxation, you must expect vat to fall. Now you going here but if we do that reserves going fall. So wait dem ain’t fall already with no economic activity to show for it? So get up now and implement aggressive agricultural green house projects and alternative energy plans. Wunna going sit there with wunna head in the sand waiting for tourism to return and if it don’t what is plan B? This whole thing does vexify me that is the truth! In the meantime you got bajans willing to pay duties and taxes and no dam cashiers to take the money! Stupes

    I mean them got nuff big brain professors and thing in there you mean it take a shop keeper to tell dem so!

  16. John A Avatar
    John A

    @Lest we forget

    Let me give you an example of the difference between how government think and how the private sector think.

    The management at customs in town would see a long RH line with people lining up outside in the sun to pay duty and say. ” let dem wait they ain’t got no where else to go and pay it.”

    Now I ain’t shame to say I does shop at Carlton cause I like the way I get treat in there. When you see 2 lines in there get too long in minutes you see 2 more registers open and why? Its very simple if Mr Bynoe make the people wait too long he run the risk they will shop somewhere else.

    Now watch how customs tardiness affects Bynoe. He cant get the goods clear cause he cant pay the duty, cause his broker in a line done by the port gate, so he loses the sales which he would of collected the 17.5% Vat on for Mia and paid in. Plus he ain’t get the goods clear neither so he couldn’t pay the 20% duty to Mia neither.

    That is why I say things don’t need to be as bad as they are here. We are our worst enemy
    And still operate in the dark ages. You know a few weeks ago I went to pay duty at the airport and the one cashier from customs went lunch and a whole line had to wait for her to return from lunch?

    If Mia really want to know how poor she revenue collection systems are tells she come and read this blog!

  17. David Avatar
    David

    The prime minister told the country a few weeks ago fraud was discovered at the licensing authority and this has delayed a more efficient system. We wait for the changes to import the system up there.

  18. John A Avatar
    John A

    @ david

    What fraud got to do with running out of the plastic license blanks and the printer brek down?

  19. David Avatar
    David

    @John A

    BRA and Licensing Authority are different departments/ministries.

  20. John A Avatar
    John A

    @David

    I understand your point, but it doesn’t change the fact that government regardless of its department, are grossly inefficient when it comes to their business practices, especially all forms if its revenue collections. Fullstop!

    If we was swimming in milk and honey like in 2007 that would be one thing, but we scrunting for revenue now as the last central bank report shows. If they can’t collect the money no problem, let us pay for our drivers licenses, land tax etc at any post office and Surepay, problem solved.

  21. NorthernObserver Avatar
    NorthernObserver

    @JohnA
    COLLECTING has been the weak link in the Barbados chain. So your argument as to at what point in the process tax is applied, while it has merit, becomes less so. And collecting is frequently the weak link for many places which employ a similar system. Hence, why governments try to extract (get paid = collect) at every opportunity. And most still come up well short.

  22. John A Avatar
    John A

    @ Northern

    My point is if you think you have problem with the people money getting “carry way” as we say then that is a simple fix. Pay you license the same place you pay your water bill and STV bill, at any post office or any Surepay. Why pray till in 2021 with so many options out there are we still practicing the archaic nonesence that we are when it comes to paying certain government bills? Wait if I could pay my water bill at surepay and the post office, what so special bout my land tax bill or drivers license that I cant pay it there too? Once it pay then let it send an electronic advise to licensing authority and let them mail the dam license to me. Lord this is 2021 not 1961!

  23. NorthernObserver Avatar
    NorthernObserver

    I was referring to VAT.
    The other issue is an entity(GOB…and the private sector isn’t much better) which is way behind in the digital world. They know this and are trying to ‘catch up’.

  24. John A Avatar
    John A

    We have to do way better if we are to stay afloat in the post covid sea of uncertainty. We must seriously restructure what we can, control both in terms of our economy and our revenue collection. Or we can bury our head in the sand and wait for the milk and honey of tourism to return, choice is ours.

  25. David Avatar
    David

    @John A

    Is it the turn of Kay McConney to appear on one of these national press conferences?

  26. Hants Avatar
    Hants

    ” Managing Director at Preconco, Mark Maloney told residents in the area that initial construction work for the road network will commence sometime in June. Some 70 homes will be built in the new development.”

    https://barbadostoday.bb/2021/05/01/major-housing-project-for-chancery-lane/

  27. Miller Avatar
    Miller

    @ John A May 1, 2021 2:57 PM
    “@ david
    What fraud got to do with running out of the plastic license blanks and the printer brek down?”
    ++++++++++++++++++++++++++++++++

    OMG!

    Like the ‘innocuous’ child you have pointed out to the ‘world’ that the Bajan emperor has no clothes on.

    Why do you “John A” have, naturally, this knack of using simple Commonsense to expose a load of bullshittery passing for the ‘proper’ management of the taxpayers’ affairs by the so-called free university-trained public sector management class?

    Now how in the world of tarnation could a suspected fraud be held responsible for the failure of the timely issuing of driver licences and registration stickers?

    It has nothing to do directly with fraud; just a mere result of piss-poor management at the top.

    In that case, those in receipt of a NIS pension ought to be similarly affected because of the failure of management to produce audited financial reports as required by Law.

    If you are to accept the PM’s explanation for the ‘gross’ inefficiency then you ought to ask whether this alleged act of fraud was part of the evidence contained in the RED bag displayed in May 2018 or is it an Act committed during the regime of the current Red administration.

    Lesson to be learned:

    “When a leader surrounds himself (herself) with “yes” men (and women), it often leads to absurd and embarrassing results. It is far better to surround oneself with honest people who are unafraid to ask questions or to point out deficiencies as they see them”.

    We know from your contributions to the Blog that you, “John A”, could never be an ass-licking” johnny like the yellow Mariposa or the red “Enuff”.

  28. John A Avatar
    John A

    @Miller

    Thanks for the kind words. I have always called it as I see it regardless of party or person. In the end when you forgive foolishness based on political loyalty the whole country suffers both D and B.

    Also lets be honest if we don’t call it as it is who will? The chamber of commerce playing the political game too, the opposition is useless and the press ain’t worth sea crab droppings, so who will put the case for the public out there? You know the biggest thing standing in our way has always been the political football and the civil service. When you combine the 2 we have the perfect recipe for disaster. Now pre-covid we used to turn our back to all these issue and just pay lip service to them, but today in the post covid economy there is no room for the nonesence that is occurring daily on this island. Question is with elections around the corner who going bell the cat?

  29. John A Avatar
    John A

    Truth is if I was the Pm I would do what needs to be done with this mess. Yes she will probably lose 4 or 5 seats but she got too big a parliament anyhow. Point is it will put the country in a much better position for her next term when hopefully tourism will return. If there is theft get out the money collection part of the business and job it out to private entities like surepay etc. Broaden the Gov ezpay program and make it more customer friendly. You say the post office under utilised now so utilise it. Let them handle the sending out of the plastic licenses once payments are made. If they got better controls there let them handle the payments for other govemrent services like land tax etc. Utilise what you have so it is more efficient and stop wasting the tax payers time by making them spend 4 hours to pay a dam bill.

    In closing let me give you another laugh. You know for the past 2 weeks everybody could park for free in the government car park by the wharf because the people that take the money say it is too much dust so they ain’t working? Yep thats right thousands in revenue lost because nobody wasn’t there to take the money. Anyhow I was still grateful cause I get a free park Thursday gone!

    If it wasn’t so sad it would be funny. Anyhow I rest my case cause it will only vexify me this blessed Saturday evening.

  30. angela cox Avatar
    angela cox

    Johhny A

    Are you crazy people worried about their health because of tge ash and you talking about govt lost revenue
    You are one real blood sucking negro
    Hope u arent an employer
    Cause truth be told they would be treated worst than slaves
    Man have a friggin heart

    Cxxxxxx

    Johnny A
    In his own blood sucking words

    In closing let me give you another laugh. You know for the past 2 weeks everybody could park for free in the government car park by the wharf because the people that take the money say it is too much dust so they ain’t working? Yep thats right thousands in revenue lost because nobody wasn’t there to take the money. Anyhow I was still grateful cause I get a free park Thursday gone!

  31. angela cox Avatar
    angela cox

    Too late for All the long talk about collection of taxes due
    The economy is in present danger of collapse
    Needs a blood transfusion right now
    The collection of taxes now is a pipe dream as businesses have been affected by COVID and govt is in no fighting spirit to confront these people on any grounds
    Legal or otherwise
    As the gov.of the CB said govt must create a path to tackle the unemployment situation and breathe economic stimulation into the economy

  32. angela cox Avatar
    angela cox

    Mia needs to address the nation on this dread situation

  33. John A Avatar
    John A

    @ angela Cox

    Its a pity you can’t think little more and take off your petty party blinkers now and again. The solution would of been to get the the 2 booths screened for the dust as was done at massy sunset crest and many other places. It would only of cost a few dollars to do that. Also all that needed to be done is use the sea water as was done down the west coast and wash down the area.
    Instead of your usual party BS you must really try to broaden you thinking little bit. Start small by wearing a red shirt with a yellow skirt! Lol

    Just so you know the smaller privately run carpark less than 70 yds away was open for the entire period the govement one was closed. Then again the dust particles up there must be was smaller. Lol

  34. NorthernObserver Avatar
    NorthernObserver

    @ac
    what are your suggestions for tackling unemployment and breathing economic stimulation?

  35. angela cox Avatar
    angela cox

    First I am not a paid million dollar consultant
    However money placed in people’s hand would stimulate the economy in more was than one and I am not speaking only about lowering of taxes which in itself would benefit mostly businesses while the spending power of people remain stagnant
    If money is the blood line of the economy then govt needs to direct its attention on the spending power of the people and not in the crumbs falling off the table policy better known as trickle down economics

  36. Enuff Avatar
    Enuff

    David
    I will reserve my comments until the national digital ID is launched. As I believe the digital ID and nrw national payment system will see these delays eliminated. Just like the police certificate of character. Hold tight!

  37. angela cox Avatar
    angela cox

    John AMay 1, 2021 7:30 PM

    @ angela Cox

    Its a pity you can’t think little more and take off your petty party blinkers now and again. The solution would of been to get the the 2 booths screened for the dust as was done at massy sunset crest and many other places. It would only of cost a few dollars to do that. Also all that needed to be done is use the sea water as was done down the west coast and wash down the area.
    Instead of your usual party BS you must really try to broaden you thinking little bit. Start small by wearing a red shirt with a yellow skirt! Lol

    Easier said than done
    BTW how do u know that govt didn’t tried just way u suggest
    But came up empty handed
    The fact of the matter that Barbados was unprepared for the ash fall and attempts by govt to those companies who were equipped to handle the ash could have been met by response that included time factors in availability
    along with having not enough man power to handle the work requested at short notice

  38. Cuhdear Bajan Avatar
    Cuhdear Bajan

    @John A May 1, 2021 7:02 PM “In closing let me give you another laugh. You know for the past 2 weeks everybody could park for free in the government car park by the wharf because the people that take the money say it is too much dust so they ain’t working? Yep thats right thousands in revenue lost because nobody wasn’t there to take the money. Anyhow I was still grateful cause I get a free park Thursday gone!

    Ya lie!

    I know how much brooms, mops and free plastic buckets cost because I acquired some of those items after the dust. $50 BDS would have bought the items, and half an hour or so would have been needed to clean the little cubicle, and you are telling me that thousands of dollars weren’t collected because nobody was willing or able to quickly swing broom and a mop?

  39. Cuhdear Bajan Avatar
    Cuhdear Bajan

    A couple of people have told me that they tried to register in BRA’s EZPay and that it is a nightmare involving providing the information online, printing a paper form [how many ordinary and elderly tax payers have printers at home?] so that means leaving home to catch one or two buses to go to a print shop, then maybe another bus to go to your bank for a signature, then maybe another bus to drop off the paper form at BRA. Now you can go home and wait for BRA’s approval.

    Somebody tell me it ain’t so. I have some property and income tax to pay and it want to pay those taxes now without having to leave home.

    John A is right. Government makes it too hard for people to pay taxes and fees even for those of us who are WILLING and able to pay. It is as though the government is too proud to take money from old people and poor people.

  40. David Avatar
    David

    @John A

    Fraud shows in different ways, stolen vehicles being registered by rogue licensing officials as one example or external players exploiting holes in the system.

  41. David Avatar
    David

    @enuff

    Looking forward to the rollout, long overdue by government. The previous government messed it up. A reminder a technology solution requires relevant policy and procedural changes to add value.

  42. David Avatar
    David

    UWI small business centre launches amid criticism of private sector inaction:
    https://barbadostoday.bb/2021/05/01/uwi-small-business-centre-launches-amid-criticism-of-private-sector-inaction/

  43. David Avatar
    David

    Caribbean Airlines resumes commercial services to/from Barbados:

    https://barbadostoday.bb/2021/05/01/caribbean-airlines-resumes-commercial-services-to-from-barbados/

  44. NorthernObserver Avatar
    NorthernObserver

    @ac
    “money placed in people’s hand would stimulate the economy”
    Sounds good.
    Should the GoB cut cheques for say $1000/month to every Barbadian (legal resident?) over 18?
    Or should they delve further, and only send the money to those persons who filed income tax returns in 2020? The ones they know how to get in touch with and are likely to file in 2022 when these taxable funds need to be part of a return.
    So every thousand people costs $1M If you cut it to $500/month then 2000 recipients would cost $1M.
    And how many months should this continue for?

  45. angela cox Avatar
    angela cox

    N0
    The govt consultants are the ones to give what you said much thought
    Right now the economy is in a super recession holding pattern and will continue to get worse
    Super inflation is right behind as businesses would try to find a financial way to keep head above ground and resist the urge of sending home people with an outcome of raising prices
    The economic picture is past gloomy and heading for a total collapse if nothing is done

  46. David Avatar
    David

    JOBLESS BLOW
    Recession hits Govt income tax revenue and NIS
    By Shawn Cumberbatch shawncumberbatch@nationnews.com
    Barbados’ recession has thousands of people still on the breadline.
    The negative ripple effect is evident in Government’s reduced tax revenue and continued demands on the National Insurance Scheme (NIS).
    Higher joblessness was singled out as one of the reasons why the Treasury received less personal income taxes (PIT) by the end of the financial year on March 31.
    Government earned $146.3 million less in PIT last financial year compared with 2019/2020, and $28.3 million less in this year’s first quarter than in 2020’s.
    Information from the Central Bank’s first-quarter economic report revealed that some Barbadians filing unemployment claims at NIS “were ineligible for unemployment payments, as they had not made enough contributions since exhausting their benefits in the previous year”.
    It added that the unemployment statistics also suggested that more people were working part-time and that “as the number of unemployed people increased in 2020, the economic conditions led to a lengthening of the time that the unemployed were in search of work”.
    The unemployment situation was highlighted when Central Bank Governor Cleviston Haynes gave the institution’s first-quarter economic review on Thursday and illustrated in recently published information by the NIS and the Barbados Statistical Service (BSS), which is responsible for gathering labour force data.
    An estimated 18 500 Barbadians were unemployed at the end of December, which meant the unemployment rate then was 13.6 per cent.
    The BSS is scheduled to release the first-quarter Continuous Household Labour
    Force Survey on May 14, but based on the most recent one for the fourth quarter of 2020, most of the unemployed – 12 500 – were aged 20 to 44 years old. In February, the NIS received 11 802 unemployment claims compared with 459 last year. This happened after the country went into lockdown from February 3. By March these claims were below 5 000.
    Most of the unemployment claims in the first quarter were from businesses and other services (37.3 per cent), followed by tourism (24.8 per cent), wholesale and retail (19.6 per cent), manufacturing (9.3 per cent), construction (6.1 per cent), transportation, storage and communications (1.6 per cent), electricity, gas and water (0.8 per cent), and agriculture (0.5 per cent).
    Haynes noted that “unemployment remained elevated during the first quarter”.
    “Spiralling unemployment claims evidenced a soft labour market in 2020, but conditions improved during the last quarter with the re-engagement of persons in the hospitality sector,” he said.
    “Government’s Barbados Employment and Sustainable Transformation programme, introduced to encourage the re-engagement of tourism workers and facilitate plant renovation and sustainable development, has led to the re-engagement of over 2 100 persons.”
    Pressure on social safety net
    The Governor said increased unemployment “reduced employment incomes and placed pressure on the social safety net”. He noted that while last year payouts on unemployment claims rose sharply, “the situation began to ease” during the last quarter of 2020.
    “With the renewed dampening of economic activity, there were over 6 000 more unemployment claims than for the first quarter of 2020, principally from business and other services, tourism and the wholesale and retail sectors,” he noted.
    The BSS said in its most recent labour force survey report that at the end of December the unemployment rate for females was 14 per cent and 13.2 per cent for males. At that time, 117 600 people were working.
    There were 81 500 individuals deemed inactive, which meant that the total labour force was an estimated 136 100 people (60 800 men and 56 800 women).
    Of those not in the labour force, the BSS said 43 600 were retired, 16 100 at school, 12 300 kept house, 5 500 were incapacitated, while 1 100 were voluntarily idle.
    The state entity also reported that most of the workforce, 19 700 people, was employed by the wholesale and retail trade followed by construction, mining and quarrying (12 500), accommodation and food services (10 600), public administration and defence (10 300), and administrative and support service (8 800).
    Construction, mining and quarrying employed the most men (11 200), while the wholesale and retail trade was the biggest employer of women (9 700).
    The BSS explained that the labour force “is defined as all persons, age 15 years and over, who live in the island and were engaged in (or willing and able to be engaged in) the production of economic goods and services”.
    To be considered unemployed, “an individual must not have worked at all during the reference period, but must have taken some steps during the preceding three-month period to find a job”.

    The graphic presented by the Central Bank on the unemployment numbers
    last week. (GP)

    Source: Nation

  47. David Avatar
    David

    Howard warns of harder times
    . . . But Stephen says it’s too early for that
    By Colville Mounsey colvillemounsey@nationnews.com
    Barbadians are being warned that over the next several months they will need to make some serious cutbacks as the country goes deeper into recession for the fourth straight quarter.
    This caution came from Professor Emeritus in the Department of Economics at The University of the West Indies, Michael Howard, in the wake of last Thursday’s report on the economy by Governor of the Central Bank, Cleviston Haynes, who disclosed that from January to March there was a 20 per cent decline in economic activity.
    However, former banking and finance lecturer at the same tertiary institution, Jeremy Stephen, believes it is too soon to issue such warnings as it could lead to further job losses. Instead, he said that Government’s plans to woo vaccinated tourists to the island must be first given an opportunity to see if it pays dividends.
    In an interview with the Sunday Sun, Howard said in the absence of real growth prospects, given that the breadand- butter tourism sector was not likely to see a resurgence until possibly next year, Barbadian consumers must now get used to the concept of making their dollar stretch.
    Be extremely cautious
    “People are going to have to learn to bear a little longer with the harsh conditions. We have to now be extremely cautious in the way we spend money. The consumer must now be prepared to plan the household with the little money that it has in order not to run into trouble. At the moment, Government has been doing everything it can to keep persons safe and afloat at the same time. They have been locking down, giving people money and I think they are going to have to continue in the same manner, giving social handouts to businesses and families, but this poses a problem for expenditure,” Howard said.
    The economist explained that with the disclosure that tourism had plunged by 96 per cent and even with a silver lining in terms of future outlook due to pent-up demand for travel, Barbadians needed to find creative means of surviving in the short term, as Government simply could not carry the burden alone much longer.
    “In terms of looking towards manufacturing and agriculture, those things cannot be simply reformed in a short space of time. I think that any suggestion of structural changes is going to be something that takes time, but in the meantime, we still have to concentrate on the short term in terms of protecting the vulnerable groups and try to ride out this thing. There isn’t much opportunity for a diverse set of policies at this stage,” he said.
    Stephen, on the other hand, said such a move on a large scale would likely shock the system and force the Government to do even more than what conditions permit. He argued that with the private sector holding strain through a series of prolonged lockdowns, public spend would be urgently needed to keep the economy afloat.
    Taking on more debt
    “Should Government continue to pursue a programme of propping up the economy, it ends up in a situation similar to what the Democratic Labour Party ended up with in the last three to four years of their rule. In other words, they would be taking on more debt because in addition to borrowing from the IMF [International Monetary Fund] they would have to source funds elsewhere. This would only serve to drive up public debt and then you are also pulling from the [foreign] reserves,” said Stephen.
    He added: “We have to wait and see if this vaccine passport-type arrangement actually has legs. This is a dead period now, and telling people to tighten their belt may be smart personal financial advice, but from a macroeconomic level what you do need at this point is for Barbadians to spend in order for people to have jobs because there are no tourists at this point to buffer that until possibly year-end.”
    In full agreement
    Delving deeper into his analysis of the Central Bank’s grim report, Howard said he was in full agreement with Haynes’ warning that the country could not afford further shutdowns. However, he questioned the 13.6 per cent jobless numbers, calling on the Central Bank Governor to provide the public with the methodology by which that figure was derived.
    “There is a situation where the economy is heading into an even deeper recession given the lockdowns and it is reasonable to expect that with uncertainty the economy cannot grow very much this year. I think that the unemployment rate might be a bit higher, and I would very much like to know the formula by which that rate was calculated. I also agree that Government should not levy any heavy taxes at this time, but there is a serious need to control the expenditure and target it only to the sectors that need it the most,” he said.

    Source: Nation

  48. 555dubstreet Avatar
    555dubstreet

    Social Living Dub

    Q: How do you bring an economy down gracefully + how do you build it up fairly and equally again
    A: Socialism, Do you know that Social Living is the best.

  49. angela cox Avatar
    angela cox

    The economic problem is one which govt have to find quick resolution
    Barbadian household income has reached rock bottom
    Barbadianhouseholds can no longer asked to hold strain or tighten a broken belt
    Saving the economy should have been a thought out process by govt and govt consultants earlier rather than now
    It is crystal clear that govt faith of the expectations on the dependency of the tourist dollar would have been in their mind an easier remedy to keep the economy afloat hence the borders remained opened
    Now three months later the public is being told the news of 96 percent fall off in tourist arrival
    Govt already new of this grim drop hence govt could have derived policies from within to make use of stimulating the economy
    Getting the economy off the ground at this point is not going to be easy because cost wise it would be more expensive than if had done earlier
    Govt tighted fisted policy towards the blood line of the economy placed the country into a deeper hole
    Someone needs to asked govt how has the 300million to the tourism industry helped the economy and saved jobless
    As I write the jobless rate keeps climbing
    Govt can talk all they want placing blame on COVID
    However the big international countries with lockdowns and COVID numbers way larger than Barbados relied on conventional methods to keep unemployment down and drive their economies with policies founded on jumpstarting the economy
    Where there is no vision the people perish

  50. 555dubstreet Avatar
    555dubstreet

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