Chris Sinckler, former Minister of Finance

A report in the local press yesterday piqued the curiosity. It detailed former Minister of Finance Chris Sinckler will be working with the region, including Barbados “with the reform of the international debt architecture and issues surrounding vulnerability of small states”. His involvement is as a result of an engagement with former employer Caribbean Policy Development Centre, where he was Executive Coordinator before serving in the Thompson and Stuart administrations.

A quote attributed to Sinckler – “It is critical to see how Barbados and the Caribbean can access money and develop finance on a concessional basis”.

The news item does not interest the blogmaster because Sinckler presided over a very challenging economic period as Minister of Finance and was the face of economic policy in the former administration. His appointment reminded the blogmaster how we have become slaves to debt at the level of the individual and government, technically one and the same.

There is the text book definition what is good and bad debt, we get it. Committing to a debt which helps to develop the individual to be marketable, grow and protect earning capacity, we get it. At the government level, to borrow within serviceable limits to create opportunities for citizens to enjoy quality living, we get it. Notwithstanding the foregoing it has become obvious accumulating debt is the preferred option above revenue generation in the prevailing culture of managing our affairs. According to the 2019 Financial Stability Report household debt increased by over 200% between 1999 to 2019. In the same period government’s struggled to manage the debt to GDP increased from 60% to close to 160% has been copiously documented. 

It is fair to draw a conclusion the majority of households are carrying significant debt- acerbated by a deep haircut by the government in 2018 on some domestic debt compounded by the 18 month pandemic. It is also fair to describe Barbados’ economy as trapped in a vicious debt cycle given its highly leveraged state. The correlation between rising household and government debt must not be ignored. Accumulating debt has become a ‘fashionable’ first option by individuals and government alike.

In a world where debt financing is the preferred option, financial institutions as the owners of burgeoning individual and government debt have grown in importance. Something has got to give. The conspicuous consumption model to which Americans and others in the West have become addicted will not work for Barbados. We simply have no sustainable export earning options available in the short to medium term. Our problem is the exponential debt accumulated in the last 20 years has broken the back of the camel. We have sown the wind and it is time to reap the whirlwind.

As a people we have to demand better from our policymakers. Tired narratives and warm over policies must be unequivocally rejected. As individuals the time has come and gone to take ownership of home affairs by making smart decisions. Getting fat from debt financing is not the recommended way. Unfortunately if we are unable to correct, it will be done for us. In fact it has already started.

The government is you, you are the government.

128 responses to “Barbados, Slave to Debt”

  1. NorthernObserver Avatar
    NorthernObserver

    @JohnA
    Politicians deal in votes around election time. It is far easier to discuss distractions, for most voters can understand them. Financial matters of depth only confuse and open the door to discussions they wish to avoid. And we know the mismanagement includes “both ah dem”. They deal in financial generalities not specifics. Which usually amounts to past incidents.
    Recall even an economics lecturer, and former B candidate, admitted to not understanding the scope of what became a partial default.
    As the racing pundit used to say…best left alone.


  2. @ John A August 24, 2021 3:02 PM
    (Quote):
    My point is that government needs to start discussing our reality with the people as opposed to focusing on distractions. How long you think we can go on with current expenditure where our income levels are ? Another 6 months or a year if you push it? Eventually we will reach a level of unservicable debt and we both know that. (Unquote).
    ++++++++++++++++++++++++++++++++++++++++++

    It’s the hallmark of a ‘true’ citizen when he or she refuses to fall for and ingest the regular load of political bullshit and bluster emanating from the empty heads of Bajan politicians and their ‘vassal’ of cronies branded with both political stripes.

    And you my friend “John A”, the King of Commonsense, represents the highest carat of that hallmark.

    The Bajan Treasury will be soon confronted with a serious fiscal deficit never seen before since Independence.

    If the current public sector payroll is to be maintained for partisan political purposes where, then, would the money come if not from additional burdens on the taxpaying camel’s back?

    The question is whether these harsh additional impositions would come before or after early elections in 2022?

    What else is there to tax besides fast foods, VAT on water, and religion?

    If Bajans think that their current sugar daddy IMF is going to be their saviour of a pied piper without demanding its pound of serious sacrificial flesh in the form a currency adjustment to their Mickey mouse currency then, according to our BU court jester Tron, they having to be living in some la la land dotted with the mirage of an economic apple pie made from Swiss cheese.

    How in the financial world of economic tarnation could a Bajan Mickey mouse buck be worth more than its shareholder Master the TT$ vis-à-vis the modern US $ Greenback?


  3. When all is said and done Sinckler would be used as the economic gopher to access loans while Mia hides in the background avoiding licks and names attached to her namely
    Champion of Borrowers


  4. @ Artax

    Deficit is no more than an accumulation of debt over a specified period. Let us focus on the reality that months of revenue shortfall will end in accumulated debt and 12 months of a calender year of this will lead to a large annual deficit. In the end in simple terms ” we going owe way nuff and we cheque book light.”


  5. What is the status of the BOSS program?


  6. @ Northern

    I agree with all you have said but whenever the tap dancing and shape shifting done, the numbers will be there staring us in the face. We are going to be in a serious situation in 12 months time unless tourism receipts grow by large amounts. It’s either that or we restructure our expenses aggressively.

    Now having said that I heard our tourism people bragging that we had over 10,000 arrivals in July, which was the best month for the year so far. Still down on 2019 of course.

    But then low and behold an Antiguan business friend of mine call me laughing at we and say in July them had 24,000 arrivals which was even up on their 2019, which was their bumper year! So I got to ask what Antigua doing that we ain’t? You feel it is Nelson Dock Yard? Then I hear Grenada doing the dog too. Anyhow when we turn republic all will be milk and honey again. That is why I say when all the noise and fluff done we still will have major issues that lack discussion.


  7. @Miller

    Thanks for your kind words, but you know if you critical of the divine rulers you is a dem. Well I really don’t give a rats derriere about politics, but I do care about where we are heading and await the plan for getting out of there.

    What is undisputable is that every month we run a deficit will mean that the chance of a quick recovery becomes further from our grasp. I also am very disappointed in the opposition and the Cave Hill economist for not entering into open discussions on the economy. But then again should I expect different ?


  8. DavidAugust 24, 2021 7:42 PM

    What is the status of the BOSS program?

    Xxccccc
    The same as always rob the poor to.pay the rich


  9. @ John A August 24, 2021 7:36 PM

    Everyone knows ‘government’ spending more than it earns results in a ‘budget deficit,’ an accumulation of which creates debt.

    But, you’re missing the point. Anyhow, let’s not take the ‘discussion’ any further and ‘agree to disagree’ in the process.


  10. @ John A August 24, 2021 7:49 PM

    Our tourist numbers are disastrously low because we brutally discourage tourists. Our politicians are infected by some kind of Corona hysteria. The fact is that the official Taliban PC test on entry currently takes 2-3 days and many emails to clear. It is harder to get into Barbados than it is to get into Kabul Airport from Kabul City, thanks to quarantine mania.

    The fact is that our population is to blame if it falls seriously ill with Corona. The majority of our population has the weight of a fattened ox because they drink to much Coca-Cola and eat too many burgers. We don’t have a Corona problem, we have a very massive obesity problem in our indigenous population. Our population should take the example of the two slim Williams brothers. They are very smart.

    If we still have these Taliban rules against international tourism in the winter season 21/22, we will go down. Since we have about 50 per cent too many civil servants and workers in the SOEs and no serious reform is in sight, we are likely to move to devaluation soon. We will soon need new banknotes anyway because of the transformation into a republic, so it won’t be an issue if our central bank adjusts the exchange rate a little. This will be very beneficial for our population, since they will have less money to kill themselves with fast food.

    Many other pepper islands in our neighbourhood are much less xenophobic. I increasingly have the impression that foreigners are no longer welcome here, even though they bring billions to us every year. The horrific attacks on minorities and business people during the Nelson riots last year raised alarm bells among many.


  11. @Tron

    I don’t have the answers but I can tell you anytime in a given month Antigua can attract 2.4 times the amount of tourist as us something wrong!


  12. @ Tron

    Now let me give you some numbers from one of the largest data sites on tourism that nobody likes to talk about. It is a site called tourismanalytics.com. Now her are the Jan- june numbers for the major 23 destinations in the region combined.

    4.49 million
    4.89 million
    11.33 million.

    Now we tourism gurus here telling people that we going be up this year arrival wise by 20% but so far Barbados running down January to June 2021 on 2020, so how we going be up 20% by December? Now Aruba and a few other places are doing good and are up over 30% on 2020, but most of the Caribbean down. So if we down roughly on 23 markets by 10% on average over 2020 and 2020 was roughly only 40% of 2019 figures, how the hell tourism could lead any recovery for we in 2021- 2022?

    Wunna don’t take my word go to tourismanalytics.com and read the data for wunna self. Them got a wash pan of data on tourism with more graphs and comparison reports than cattlewash Beach got moss! So when wunna done read some of it, ask the CTO based on all that independent data where the hell a 20% increase in tourism arrivals coming from in 2021 over 2020, which remember was only 40% of 2019 to begin wid!

    Wunna beginning to understand yet the dire state our economy is in now with us depending on tourism as we salvation ?


  13. For clarity the years for the above figures shown in ascending order so this is what it is for those that don’t want to work it out for the Jan-June periods.

    4.49 M
    4.89 M
    11.33 M

    The M is for millions.


  14. David how come when I type in years in front amounts dem don’t show?


  15. Just read

    https://visitantiguabarbuda.com/travel-advisory/

    then you know why A & B is sooooo much better off.

    Here in Barbados, people who invest many millions are harassed on entry. They have to stay in a shabby hotel like Sandy Lane for 2-4 days after entry and cannot enjoy the pleasant amenities of their villa. For me, this is clearly a violation of the UN Charter on Human Rights if you have no access to a private swimming-pool.

    I predict that we will be totally left behind by the other pepper islands in the winter season. We are at the bottom of the league in tourism regionally and have a reputation for being xenophobic.

    p.s. I am not writing this as a criticism of our honourable government. But our government obviously has the wrong medical and economic advisers.


  16. https://www.nationnews.com/2021/08/25/50m-injection-sustain-nis-unemployment-fund/

    and keep the wicked, THIEVING hands of the williams and other MINORITY CRIMINALS out of the Black population’s pension fund…time to lock up the thieving hoteliers for robbing the workers their salaries, severance and benefits..or find yaselves EXPOSED EVERYWHERE…


  17. @John A

    Inserted the link to the primary info here:

    https://tourismanalytics.com/index.html


  18. Barbados receives IMF boost
    BARBADOS HAS RECEIVED about $261.6 million from the International Monetary Fund (IMF) as that institution further helps member countries battle the COVID-19 pandemic.
    Minister in the Ministry of Economic Affairs and Investment Marsha Caddle said the funding, which she stressed was not a loan, was Barbados’ share of a $1.3 trillion new allocation of Special Drawing Rights (SDRs) issued by the IMF.
    The SDR (Special Drawing Rights) is an international reserve asset, created by the IMF in 1969 to supplement its member countries’ official reserves. Caddle, speaking in the House of Assembly yesterday during debate on a $50 million supplementary for the National Insurance Scheme’s Unemployment Benefit Fund, said the new IMF money was a boost for Barbados’ international reserves, which now exceed $2.6 billion.
    “I am happy to report this afternoon that the Governor of the Central Bank has just advised me that we are in receipt of what we call the IMF Special Drawing Rights in the amount of $261.58 million,” she informed the House.
    “Now before the . . . Leader of the Opposition leans forward with too much interest to accuse us of going further into debt, it is not a loan. Special Drawing Rights are what are termed as unconditional liquidity, so it gives us a little bit more elbow room and further space to meet some of the demands of the time that we are in.”
    Latest mission
    The St Michael South Central representative said the new IMF funding had arrived this week as Government was holding its latest mission with that entity.
    “We have done the work and we have demonstrated the fiscal responsibility such that there is confidence in the international community that Barbados knows how to spend its money responsibly on behalf of its citizens,” Caddle said.
    “That is not something the last administration could have said and so it is not a question of having the liquidity, it is a question of using those resources for the right reasons.”
    IMF managing director Kristalina Georgieva said on Monday that the new allocation, the largest in her organisation’s history, “is a significant shot in the arm for the world and, if used wisely, a unique opportunity to combat this unprecedented crisis”.
    “The SDR allocation will provide additional liquidity to the global economic system – supplementing countries’ foreign exchange reserves and reducing their reliance on more expensive domestic or external debt,” she explained.
    “Countries can use the space provided by the SDR allocation to support their economies and step up their fight against the crisis.”
    “SDRs are a precious resource and the decision on how best to use them rests with our member countries. For SDRs to be deployed for the maximum benefit of member countries and the global economy, those decisions should be prudent and well informed,” Georgieva added.
    She said the IMF, in an effort to support countries and help ensure transparency and accountability, would provide “a framework for assessing the macroeconomic implications of the new allocation, its statistical treatment and governance, and how it might affect debt sustainability”.
    (SC)

    Source: Nation


  19. yardfowls/-Slaves too love to glorify debt Slavery…hear them ” oh we are so fortunate to be in debt..be thankful we got more loans.. for another 4-5 generations, couldn’t do it without DBLP..we gotta keep voting for them”….

    useless clowns will never know the difference between slavery and freedom..


  20. @ David.

    Thanks that site is a wealth of data


  21. @John A

    Have we identified the reason Barbados is lagging the others destinations?


  22. @ David

    Those questions remain unanswered. We have no time for such trivial matters as we have a republic to introduce in a few weeks.


  23. What is clear is that our neighbours are running circles around us in terms of tourism recovery, especially Antigua, St Lucia and Grenada. When Antigua in July can beat the arrival figures for 2019 which was their bumper year what does that tell you?

  24. NorthernObserver Avatar
    NorthernObserver

    @JohnA
    Read the above article posted this morning, and tell me if the money received from the IMF is REPAYABLE.
    It is NOT a loan. And the LoO cannot accuse Bdos of going further into debt?
    An SDR is a unit used by the IMF.


  25. @ John A August 25, 2021 7:48 AM

    We see a clear redistribution in the regional tourism market, away from Barbados to the other pepper islands. Our government must be hell-bent on not making this development permanent, because after the racist Nelson riots, many foreigners got the impression that they are no longer welcome on our island. However, I can well imagine that we will be permanently left behind in the tourism market because we are not cosmopolitan enough and too expensive.

    One more remark: Currently, almost no “normal” tourists come to us. Our visitors are mostly impoverished Windrushers from the US and UK who are visiting their relatives here after the pandemic has cleared. This group unfortunately leaves very little money with us, e.g. when they stay overnight with their local relatives.

  26. William Skinner Avatar

    @ all
    These days all we get are pitiful crocodile tears. We all know that our tourism product has been declining for at least 35/40 years.
    Racism, stifling of tourism business opportunities for small black operations, blaming beach vendors , treating black American tourists very poorly, allowing the once beautiful infrastructure to become run down.
    And in more recent times allowing two top , visionary tourism executives with proven track records to end up elsewhere simply for political reasons.
    A lot of square pegs in round holes ………
    We have always believed that sea and sun were exclusively divined gifts that nobody else had.
    Drowning in crocodile tears…………
    More to come.
    Peace.


  27. @ Northern

    To be honest I blow past that article and smile. If you in a hole and I give you some money and you eat through that and tell me it ain’t no loan so it don’t matter well power to you my friend.


  28. William there is not doubt that Petra has made a positive impact on Grenada’s tourism.


  29. @ David

    Check your email


  30. @ David August 25, 2021 7:38 AM

    The main reason is obvious. We have one of the strictest Corona protocols in the region. I refer you to my link to A & B, which consists of a simple Corona test before entry. Our protocol was designed with the intention of deterring entry and isolating our island. Almost like Australia New Zealand. Our protocol costs tourists at least 500 USD per person when I add testing costs and hotel costs.

    @ William Skinner August 25, 2021 8:05 AM

    Thank you for your comment. By the word xenophobic, I mean primarily other nationalities. If visitors no longer feel welcome, they will be welcomed with open arms in A & B or Grenada.


  31. @ David

    Thanks wunna find it strange that of the 23 countries reviewed the only one that did not submit data was Bim? LOL


  32. We had to take a PCR test 48/72 hours before departing for the island. The results had to be negative.

    Purchase health insurance for US $15.00/person.

    A temperature check when we landed.

    Daily temperature check for 5 days.

    Wearing masks whilst on the hotel premises.

    We must take a PCR test prior to departure (within 72 hours)

    When reading the requirements over the internet they seem very restrictive, but I have found that they do not impact on our movement/comfort.


  33. @ David

    Thanks for posting the graphs. What they clearly show contrary to what our government is saying, is that the data does not support any claim that we can expect a 20% growth in tourism during 2021. Further from a growth the region is actually down on 2020 mostly. Yes Antigua and a few others are doing well in terms of recovery on 2020, but the half year figures show a 20% growth as our minister is claiming will happen is not a reality.

    So my question which I have been asking for the last year is ” what is de plan?”


  34. Our government has not implemented the far too strict Corona Protocol out of its own conviction. The fault lies with the opposition, especially Senator Caswell, who incite the population with xenophobic and homophobic slogans. Also partly responsible are our Taliban doctors who would prefer to bar all foreigners or impose a quarantine of several months.

  35. William Skinner Avatar

    @ all
    There are two things we need to admit here:
    1. The government must be complimented for its handling of the COVID crisis;
    2. In recent weeks the message/ information has been somewhat muddled.
    Finally, we can talk all we like but we cannot afford any major break out of any virus. Anytime we experience 500 + deaths we are into the dark ages socially and economically.
    It is absolutely amazing that we have failed to change our thinking and economic planning although the es noire globe is moving in different directions.
    We are still trying to squeeze the little that is left out of outdated economic thinking that in reality has never been seriously beneficial to us.
    There is a lot of intellectual dishonesty because those “ learned” ones who cannot be ignorant of present realities, are still feeding the government a lot of outdated crap.
    We need to l bel with the people and set new realistic , attainable and sustainable goals. The first major occupation should be to create new jobs in emerging new enterprises. Silenced the voices of the traditional corporate/ business sector who are stuck in the retail thinking of the slave days.
    More crocodile tears to come……


  36. Barbados has always been proud of their reputation as a racist destination….that ignorance will now bring them to their knees, no one wants to be around black on black racists pimping for white tourists….nor wicked racist hoteliers, it will now all come FULL CIRCLE…..goddamn beggars, not doers nor creatives..

    the article clearly said it was not a loan, Barbados gets grants…ALL THE TIME from EU and other countries… especially for EDUCATION and never deem it necessary to tell the people, playing their yardfowl/Slave games…


  37. @John A

    The narrative from the general population is also disappointing.


  38. Wuhloss…still confirming but is this a relative of Sir Cocaine Trafficker threatening and calling shots…it’s been decades the sensible members of the population have been hoping to see the backs of these criminals…one less cartel/ syndicate to rid out of Black lives.

    “Heard she had a meeting with the private sector an ryan haloute get on bad saying if she ever lock down again he sending home all 800 workers .”….


  39. @ William Skinner August 25, 2021 9:52 AM

    Our population is only susceptible to severe courses of the Corona virus because they have evolved from the lean African type to the fat white US type.

    Please tell me why our businessmen and their unemployed employees are responsible for the population becoming as fat as hippos?


  40. More food price increase for the Barbadian household and not a,word from govt asking the private business to yield on the side of commonsense under harsh economic circumstances many households have to undergo
    Where is the promise of Hope
    Asking for a friend


  41. @ALL

    If we don’t want to end up as concentration camps under tropical skies like Australia and New Zealand, we need enough vaccine by autumn.

    Vaccination is the final solution, not what the BAMP Taliban tell us about masks and Corona camps.


  42. The people hungry can’t find RH job
    Govt collecting money from the IMF and boasting about the 2.5billion in reserves
    None of which is alloted to help the suffering bajan
    Matter of fact that 2.5billion would be loaded of the people back
    And all day long the long winded talk about CoVID and Republic
    First of all govt have no cure for CoviD which means that after two years of nuff talk on BU there is an ongoing attempt to use COVID as a distraction away from the economic malaise which this country is heading
    Now comes along COVID the ultimate distraction which also does not lend itself to BARBADOS having a better economy
    Guh long keep fooling wunna self while the last economic wheel call tourism falls off the wagon and govt have nothing not even a screw driver hammer or nut to replace it
    withh…What abunch of bumbleheads


  43. To be fair we can’t blame government or the retailers for these increases. The dam commodity prices are up and to make it worst the freight rates are at the highest levels in 20 years. What we need to do is start plowing up some grown and planting corn as that is a major input for animal feed. Let we stop moaning and start acting.

  44. William Skinner Avatar

    @ John A
    For the last several years , many entrepreneurs tried to get into live stock feed production.
    . Several of the products were used but they all floundered. Once more we failed to invest in our people. Note Roberts is an excellent and exciting story of local manufacturing but competing with other locally produced products could have helped to keep prices competitive and create employment.
    The same can be said of efforts in the fishing industry and some agro based industries as well.
    Once more we shed crocodile tears……..


  45. @John A

    Who should be blamed for moving the economy to one that is significantly dependent on imports?


  46. William Skinner August 25, 2021 2:13 PM #: “Roberts is an excellent and exciting story of local manufacturing but competing with other locally produced products could have helped to keep prices competitive and create employment.”

    @ Mr. Skinner

    What other local manufacturers produce lard, margarine, shortening, cooking oils, poultry and live stock feeds that competes with Roberts Manufacturing?

    In June 2021, a Jamaican investment company called PROVEN Investments Limited (PROVEN), acquired 50.5% interest in Roberts from Massy.

    And, you have a situation where Massy owns both wholesale and retail outlets. Also, bear in mind, the company has been systematically closing subsidiary companies.

    What is there to prevent the owners from moving operations to Trinidad or Jamaica, where production costs are probably lower, and then importing products through Massy’s distribution outlets to be sold at cheaper prices in its retail outlets?
    Remember Pepsi.

  47. NorthernObserver Avatar
    NorthernObserver

    @Artax
    They don’t have to be cheaper, the owners merely have to make more 💰?


  48. @ NorthernOboutlets

    I don’t understand your comment.

  49. William Skinner Avatar

    @ Artax
    ” @ Mr. Skinner

    What other local manufacturers produce lard, margarine, shortening, cooking oils, poultry and live stock feeds that competes with Roberts Manufacturing? ”
    Note I was speaking of livestock feed products. I specifically said:
    “For the last several years , many entrepreneurs tried to get into live stock feed production.
    . Several of the products were used but they all floundered.”
    I never said that other local manufacturers were producing : lard, shortening, cooking oils and that they were competing with Roberts.
    I specifically said that those who tried to produce livestock feeds had floundered. I merely stated that with more investment in that area and others fishing and agro based industries might have resulted more competition resulting in better prices for the consumer.
    I hope this clarifies my line of thought.

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