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4.5% growth in Barbados’ economy for January-June 2024

Governor of the Central Bank, Dr. Kevin Richards

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The blogmaster did a scan of the review and it is the same old. Growth realised was heavily reliant on the tourism sector and related services. Despite Dr. Greenidge’s flowery narratives that is the main take away.

Although achieving growth for which we are grateful, what about the inadequate numbers of sanitation trucks and buses to service the public? Telecoms that continue to take advantage of consumers? What about our pop down QEH?. Many other issues we have to get right to define what is fit for purpose government.

The blogmaster is not being deliberately obtuse, the reality for the man in the street is that our economic technocrats must demonstrate how it will work for the betterment of households.

#manyhandsmakelightwork

– Blogmaster

The review provides an update on key economic indicators, including economic growth, the debt-to-GDP ratio, inflation, the unemployment rate, and the level of international reserves, as well as information about Government’s fiscal performance in the first three months of fiscal year 2023/24 (April to June 2024).

Governor Greenidge also gives his outlook for the economy for the remainder of the year and takes questions from the media and members of the public.

–Central Bank of Barbados

Review of Barbados’ Economy: January-June 2024

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83 responses to “4.5% growth in Barbados’ economy for January-June 2024”

  1. David Avatar
    David

    Financial markets taking a beating today so far. Majority of Barbadians are oblivious with more important matters to deal with on the road. We have to balance revelry with other competing priorities.

  2. Terence M Blackett Avatar
    Terence M Blackett

    STOCK MARKET PALPITATIONS; CRYPTOS COLLAPSING; JAPANESE MARKET WORST SINCE 1987; WORLD ON FIRE LITERALLY WITH SOME CRYING RECESSION & OTHERS OMINOUSLY CITE 2008/9 DEBACLE; WHILE THE OBLIVIOUS MASSES PARTY AS IF THEIR LIVES DEPENDED ON IT

    Welcome 2 a world so “DUMBED-DOWN” that they make “HUMPTY-DUMPTY” look like a Disney character!!!

    US Stock Market opened “4-DIGITS” down on a bruising Monday mornin’ after a very painful last week on Wall St, with Cryptos dropping sharply & the Asian markets seeing a “HUGE SELL-OFF”; Japan feeling the “HEAT” as they did back in 1987 with the “US JOB MARKETS REPORT” in a major pickle!!!

    Some are arguing that the Federal Reserve waited too long to cut interest rates on the back of the jobs report while the Bank of England made the 1/4 of 1% cut given its own economic indicators – spurred on by the “NEW GOV” & the “LADY IRON CHANCELLOR” Rachel Reeves kickin’ some backside in the “UK TREASURY” & cutting a whole bunch of stuff (TRIMMING THE FAT LEFT BY THE FORMER GOV) in a cost saving exercise…

    NY opened with the DOW down 1120 points; NASDAQ down 1050 with the S & P 500 down 200 points as the market continuing to drop. The Japanese Nikkei down 12% – worst performance since 1987; cryptos have shed over $250 BILLION* overnite; Goldman Sachs have “UPGRADED” their RISK* of a “RECESSION” from 15% to 25% with the “EMPLOYMENT RATE” ticking up to 4.3% with a quarterly rise or uptick in the numbers since the spring…

    Some “INVESTORS” are saying that this is “MARKET CORRECTION” given the “HYPE” around AI & the unseen profits being raked in by “SPECULATORS” – so they do not believe that a “RECESSION” is nothing to worry about, but we heard the same “TUNE SUNG” in 2008* when “LEHMAN BROS” were saying that the walls are solid steel – thus “IMPERVIOUS” to penetration!!!

    LOOK HOW THAT WORKED OUT

    This has been the “BIDEN/HARRIS” economy & the “SHAMBLES” of the “WRITING ON THE WALL” for the US economy, but moreover what that will portend when “MELTDOWN occurs for other lesser developed nation state economies like Barbados!!!

    THIS FROM FOX 53 MINS AGO

    #Panic??? #YouDecide

  3. Terence M Blackett Avatar
    Terence M Blackett

    IF YOU ARE A CRYPTO ENTHUSIAST THEN YOU TOOK A BEATING BY THIS MORNING!!! HOWEVER, ALL IS NOT LOST AS THIS IS THE TIME TO BUY LOW – IN ORDER TO SELL HIGH WHEN THE CORRECTION IS OVER!!! FOR IF THE MARKET NOSE-DIVES INTO FULL-FLEDGED RECESSION OR INTO A MAJOR MARKET CRASH – THEN THOSE WHO HOLD “CRYPTO” WILL BE IN THE DRIVER’S SEAT WHEN THE DUST SETTLES & THE SMOKE CLEARS

    Look who is getting the “BLAME”!!!

    #WhatAWorld
    #ItsAboutMoneyStupid
    #EverythingGoin2Hell

  4. Terence M Blackett Avatar
    Terence M Blackett

    AMAZON’S JEFF BEZOS JUST LOST $15 BILLION IN A MATTER OF HOURS; 10,000 BITCOINS WERE WORTH $700,000,000 LAST MONTH – TODAY THOSE SAME BITCOINS ARE WORTH $200,000,000 (LESS)!!! THE BLOODBATH CONTINUES & THE MARKET MAY NOT HAVE THE FIBRINOGEN TO CLOT THE BLOOD-FLOW

    Again, “FOLKS” are “DANCING” & “PARTYING” like its the 4th of July while everything goes to “HELL” in a pan-cart!!!

  5. Terence M Blackett Avatar
    Terence M Blackett

    TIME 4 THE FINANCIAL PUNDITS ON BU 2 STEP UP & GIVE AN ANALYSIS OF THE WORLD ECONOMY & HOW IT WILL AFFECT BARBADOS!!! THE PROBLEM TODAY IS THE JAPANESE YEN & THE BANK OF JAPAN WHO HAS HAD TO BE COMING UP AGAINST A STRONG DOLLAR – SO THE JAPANESE MANIPULATED THE MARKET THROUGH THE YEN BY RAISING RATES & FLOODING THE MARKET BUT THE FED WAS SUPPOSE TO CUT (#Pivot) BUT DID NOT IN TIME – HENCE THE YEN KEPT KNOCKING DOWN POSITIONS BOTH IN CHINA & AROUND THE WORLD MARKET

    And viola, the “GLOBAL MARKET” began “PUKEING” after the “CROPOVER PISS-UP”!!!

    “DRAMATIC LANGUAGE” or “MACROECONOMIC REALITIES”??? #YouDecide!!!

  6. David Avatar
    David

    @TB

    For as long as we have had financial markets and the products that make it work, there have been boom and busts. It is the way of the world.

  7. Terence M Blackett Avatar
    Terence M Blackett

    @David

    “YES” – #BoomAndBust is a “FAULTLINE” in the #KenysianEconomicModel…

    “BUT HOW LONG IS TOO LONG WHEN IT’S GOOD”, CORRECT???

    Sadly, we have been told by the “BANKSTERS” & “GLOBALISTS” et al what is “ULTIMATELY COMING” – yet we have “BURIED OUR HEADS” in the sand – some pulling the blanket over their heads & have gone back to sleep!!!

    We are even in “DENIAL” of what “PROPHETIC SCRIPTURE” says in regards to what is coming based on Revelation, chapter 18!!!

    My dear Bruh, #InOneHour (SUDDENLY) everything will “GO 2 HELL IN A PANCART” & the “TIME IS AT HAND”!!!

    I don’t know how often I have to say it!!!

  8. Terence M Blackett Avatar
    Terence M Blackett

    ANOTHER DAY – SAME ‘OLE CRAP

  9. Terence M Blackett Avatar
    Terence M Blackett

    HAS THE PARTYING COME 2 AN ABRUPT END? WHO WILL BE WUKKING UP AS THE CRAP* HITS THE FAN? BANGLADESH PRIME MINISTER SHEIKH HASINA WAZED WAS RUN OUT OF OFFICE – AIRLIFTED TO INDIA BY MILITARY HELICOPTER DUE VIOLENT PROTESTS & OVER 100 DEAD – (AN OMINOUS SIGN FOR OTHER SO-CALLED WORLD LEADERS)! PROTEST ACROSS THE UK WITH NO SIGNS OF DIMINISHING – AFTER THE DEATH OF 3 LITTLE CAUCASIAN GIRLS, BY A BLACK RWANDAN BOY – BRINGING THE BRITAIN FIRST RADICAL FASCISTS OUT IN NUMBERS, BURNING, LOOTING & ENDANGERING POLICE LIVES & OTHERS! RUSSIA JOINS IRAN BY SENDING WEAPONS OF MASS DESTRUCTION INTO THE THEATRE OF WAR IN THE MIDDLE EAST!

    The question I keep asking: “IS EVERYTHING GOING 2 HELL IN A PAN CART???”

    Will “DONALD TRUMP” have anything to save when he wins the 2024 US Election??? Or can SCAMALA HARRIS laugh & “WUKK_UP” her way into providing answer to the “ILLS” plaguing the entire world? Who has any answers???

    #NoAnswerRequired!!!

    For there is “NONE”!!!

  10. David Avatar
    David

    How can SIDs protect fragile open economies in such a volatile global economy?

  11. David Avatar
    David

    @TB

    Doesn’t Bangladesh have a history of political instability?

  12. Bush Tea Avatar
    Bush Tea

    LOL
    What the Hell…

    Question – (thanks to TB’s video above) ..
    “How can the USA have such huge debts, when they can print whatever money they wish to?”

    The answer from the ‘expert’ is funny as shiite….
    Essentially, He don’t understand it, …but it MUST be so… lol

    In Fact, ‘money’is just an illusionary concept that carries ONLY the value that we collectively CHOOSE to ascribe to it.
    For decades now, the value of money has been dictated by US military power.
    BUT since Vietnam, every Tom Dick and Harry has been putting licks in the USA’s military and economic donkeys -except of course for little Grenada.

    YET, we live in a shiite world that REVOLVES around THEIR money,
    Even worse, Brassbados’ world revolves around their BORROWED money…

    Here is a question for anyone with ANY ability think lucidly…
    What happens to the value of all this shiite money when (not if) either the clown Trump, or the airhead Kamala (OR anyone else for that matter) gets to determine the value of US power, ie of their (our) ‘money’?
    EVEN the PROSPECT of the immediate future is causing CHAOS in the financial markets…

    the Bible speaks of the time when money will have little value…
    ‘Then I heard what sounded like a voice among the four living creatures, saying, “Two pounds of wheat for a day’s wages, and six pounds of barley for a day’s wages, and do not damage the oil and the wine!” ‘ Rev:6:6

    One is forced to wonder how much our much vaunted (borrowed) ‘reserves’ will be able to buy us in the next few months… or what our personal ‘bank savings’ will be worth…

    What a time to be around…

  13. John A Avatar
    John A

    Anybody buying goods out of china and paying in US dollars have already today been advised of increase prices.

  14. Hants Avatar
    Hants

    Invest.

    https://nationnews.com/2024/08/06/boss-investors-repaid-4-5m/

  15. David Avatar
    David

    Economist warns of fallout from conflict

    By Colville Mounsey colvillemounsey@nationnews.com

    As geopolitical tensions continue to rise in the Middle East, economist Jeremy Stephen has issued a stark warning about the potential repercussions for the Barbados economy.

    His concerns centre on the possible resurgence of logistical issues and inflation which could significantly impact the cost of living in the country.

    He argued that these escalating issues, despite not involving direct United States participation, created a scenario akin to a world war, with multiple nations embroiled in conflicts that could have far-reaching economic impacts.

    “In Jordan, right now and Lebanon, there has been some increased instability. In addition, there is Israel’s unwillingness to ease their tensions with Palestine back to, let’s say, a pre-COVID level, or at least during the ten years going into COVID. Russia is still trying to gain ground in the Ukraine. On top of that, there’s increasing tensions in the South, the Asian South Seas as well. I am of the view that we’re in the middle of a World War III right now,” Stephen explained.

    “Essentially, there are too many countries involved in escalating issues for it not to be viewed as a world war. So, it essentially means one of two things: that the issues that we had during COVID with logistics may begin to rear their heads again,” he added.

    The former UWI banking and finance lecturer pointed out that during the COVID-19 pandemic, Barbadian distributors and importers had to source products from alternative markets, such as Turkey, due to logistical disruptions in the US and Europe. This stopgap measure proved effective at the time, but renewed conflicts in the Middle East could jeopardise these supply lines.

    Product issue

    “If the Middle East deepens into war, a lot of the products that we sourced in the Caribbean as a stopgap measure might have issues getting here in a timely manner. If it’s not timely, therefore, it may not be cost-effective,” Stephen noted. “You can expect, at least in the Caribbean, probably an escalation of inflation again.”

    Minister of Foreign Affairs Kerrie Symmonds also expressed significant concern over the potential impact these developments could have on Barbados. Symmonds highlighted the numerous conflict zones and geopolitical struggles currently unfolding worldwide and urged Barbadians to prepare for potential economic repercussions.

    “These are areas where there are military-type struggles taking place. Obviously, there is a point at which the global economy as a whole is going to start to feel the pain,” Symmonds said. He emphasised the enduring nature of these conflicts, particularly highlighting the ongoing crisis in Gaza with Israel and Palestine and the protracted war between Ukraine and Russia.

    Economic performance

    Emphasising the importance of focusing on domestic economic performance and maintaining vigilance, Symmonds cautioned: “We are not out of the woods and we have to pay very close attention to our domestic economic performance and continue not to just rejoice in the growth that we have achieved, but to continue to redouble our efforts to make sure that we can be in a position of relative safety.”

    Fuel prices are another area of concern, given the Caribbean’s indirect reliance on fuel prices influenced by Middle Eastern dynamics. Stephen warned that deepening tensions could lead to increased fuel prices, subsequently driving up transportation and electricity costs.

    “Given that the majority of our vehicles still use fuel and our homes are still connected to the grid, you can expect that this may result in pressure on Light and Power or Emira to raise or to adjust for the fuel clause, which means paying more on light bills, if these tensions deepen in the Middle East,” he explained.

    Ripple effect

    Additionally, Stephen emphasised that logistical issues stemming from the Middle East conflict could ripple out to other regions, including South Africa, impacting the availability and cost of various goods.

    While the immediate impact on tourism remains uncertain, Stephen suggested that ongoing riots and economic policies in the United Kingdom could influence the upcoming tourist season. He stressed the need for vigilance and adaptive measures to mitigate potential economic disruptions.

    “In the near term, even with these riots in the UK, I don’t think it damages the tourism product this year, given how close to the season it is. People will want to escape, although there’s a likelihood that the riots may result in damage to property. If you are seeing further or deeper damages in property, particularly business property in the UK, maybe you might not get as many people as you thought you would. But at this time, it’s still a little too close to call,” Stephen remarked.

    He added that the response of the UK’s new Labour government could also play a significant role in determining the extent of economic impacts. Expansionary policies aimed at improving economic relations with the EU and mitigating Brexit’s effects could bolster spending and reduce negative outlooks, he suggested.

    Source: Nation

  16. Tron Avatar
    Tron

    The brilliant economic policies of our Supreme Leader are beginning to bear fruit. We are now a Caribbean tiger state on the verge of becoming a First World civilisation. It is only a matter of time before we surpass Singapore and Switzerland.

    True training at the London School of Economics instead of buying a worthless paper called LEC was the right choice. Our forthcoming Constitution of the New Order should stipulate that no Prime Minister shall hold LEC.

  17. David Avatar
    David

    After receiving a shitload of concessions we are hearing a south coast hotel (Sandals) is looking to send home 200 employees?

  18. Hants Avatar
    Hants

    Why?

  19. David Avatar
    David

    You know we are in trouble when you have to read tired regurgitated messages from Minister Simmonds.

    Retailers urged to contain prices

    By Colville Mounsey

    colvillemounsey@nationnews.com

    Government is concerned that certain retailers are not doing their best to contain prices.

    Minister of Foreign Affairs and Foreign Trade Kerrie Symmonds, who is Senior Minister with responsibility for the Productive Sectors, is urging retailers to act responsibly in their pricing strategies.

    He revealed that one of the key outcomes from a recent Cabinet meeting was the directive for the Ministry of Commerce to enhance its efforts in assisting consumers to locate the best prices.

    “There is clear evidence to us that prices are being contained by some parts of the Barbados distributive sector, that they are keeping prices at realistic and very low levels. And then there are other people who are being very cavalier with the public,” he said, without identifying the latter.

    Symmonds called for greater transparency in pricing, urging the public to support retailers who prioritise consumer well-being and to avoid those who are not.

    “The public needs to know who are those that are acting in a dishonourable way and be able to treat those people appropriately, while lending their support to those who are looking out for the well-being of the consumer,” he said.

    He added that the Ministry of Commerce had been conducting monthly assessments of prices across the country, revealing a pattern of commendable behaviour by some supermarkets in maintaining reasonable prices.

    Symmonds praised these retailers and encouraged Barbadians to continue supporting them. However, he also pointed out the detrimental actions of other retailers who disregard the broader community’s interests.

    “Every month we get an understanding of how the prices are moving. Every month we see a clear pattern begin to unfold where there are some supermarkets which are really behaving in a way that is decent, honourable, commendable,” he noted.

    He stressed that the Government’s focus remained on protecting consumers and ensuring they were informed about where to find fair prices.

    The minister also emphasised the importance of prudent and sensible spending by the public amidst concerns about the high cost of living due to heightened geopolitical tensions.

    “It is important that we do that which we have all done throughout the history of this country, that we be prudent, that we be sensible and that we exercise caution in the way in which we conduct our activities,” he stated.

    Barbados, like many other nations, has faced significant challenges related to food prices in recent years. The global pandemic, supply chain disruptions and inflation have all contributed to the rising costs of essential goods, making it harder for consumers to afford basic necessities. In response, Government has taken steps to mitigate these impacts through various measures, including the establishment of a Social Compact.

    That compact, which had two instalments, was an agreement between Government, the private sector and trade unions aimed at stabilising prices and ensuring the availability of essential goods at affordable rates.

    Symmonds said Government continued to be committed to the principles of the Social Compact. By enhancing the Ministry of Commerce’s role in monitoring prices and providing consumer guidance, the aim was to uphold that promise to protect Barbadians from exploitative pricing practices, he explained.

    Source: Nation

  20. Bush Tea Avatar
    Bush Tea

    Apart from slashing tyres and abusive language, what has this minister EVER done successfully?
    OF COURSE we are in trouble….

  21. David Avatar
    David

    Canada-based Bajan economist questions review

    CENTRAL BANK REPORT SHOT DOWN

    Canada-based Barbadian economist Carlos Forte is questioning the Central Bank of Barbados’ recent statement that the economy grew by 4.5 per cent in the first half of the year.

    However, the Central Bank says it is standing by the report.

    In a statement yesterday, Forte took issue with the Central Bank’s January to June report on the country’s economic performance adding that “the leadership of the Central Bank needs to hold a press conference forthwith and correct the public record”.

    “These errors have inflated Barbados’ nominal GDP estimates and its estimates of the real economic growth rate,” he charged.

    Forte further claimed that his analysis “suggests that in the last year and a half, the Central Bank has been systematically inflating its estimate of tourism’s contribution to nominal GDP, and over-estimating Barbados’ economic growth rate”.

    “The Central Bank’s most recent report on the performance of Barbados’ economy is riddled with errors. Not unlike the first quarter report earlier this year. Barbados’ economy did not grow by 4.5 per cent so far this year, in much the same way that it did not grow by 7.9 per cent in the first six months of last year,” he claimed.

    Forte said he had “heard a lot of Barbadians publicly expressing dismay and disillusionment about the disconnect between the Central Bank’s report on the performance of the economy and the actual economic conditions they are experiencing and observing in Barbados”.

    “I have expressed my own concerns with the errors repeatedly presented to the public during the Central Bank’s press conferences since 2020, in particular over the last two years,” he stated.

    “Today I am calling for an audit or peer review of Barbados’ national economic statistics, in particular those key economic indicators that are reported by the Central Bank – the rate of economic growth, nominal GDP, the rate of inflation and the unemployment rate.”

    His view was that “what the Central Bank reported to the public three weeks ago about the performance of the Barbados economy is alarming and should not be taken seriously by any Barbadian or international institution.”

    In response to Forte’s statements, the Central Bank said it was standing by its report and that it welcomed all public discourse on its economic reviews.

    Specific concerns Forte raised included estimated tourist spending.

    The economist also flagged the estimates of tourism services exports otherwise referred to as travel credits.

    “The Central Bank’s estimate for the first six months of this year is $1.5 billion, 41 per cent higher than the first six months last year and 75 per cent higher than the first three months of this year, which overlaps Barbados’ peak winter tourist season,” he said.

    “Compare that to the 28 per cent increase in tourists spending that the Central Bank reported for the first three months of this year. The Central Bank . . . should have been aware of it before its July 29 press conference,” Forte added. (SC)

    Source: Nation

  22. David Avatar
    David

    Facts are indisputable

    IWAS ONCE the top junior (Under-16) basketball player in Barbados. Fortunately, I had a specific set of gifts that ensured that at the ages of 14 to 15 years old, I was going to be leaps and bounds above my competition. The only guy I rated as better was Jeremy Gill, the famed Clapham Bull point guard of similar age who was way more technically sound than I had ever been or ever would have been. I, however, was blessed with a 44-inch vertical leap, had NBA-level fitness and quickness so I could run an entire game at full speed, and I was an exceptional mid-range shooter, meaning that I couldn’t hit a three consistently to save my life but was extremely useful otherwise.

    What I considered my best asset, though, was the ability, on the court, to see a person for who they really were. This is a small part of what we call in the sport: court awareness. It implies that though you can see plays developing in front of you, even from the defence’s point of view, you make the best choice based not just on what was available but more so on who is or will be available. Certainly, you needed to understand the people you were playing with.

    This is why I always knew that whenever I played against Coleridge and Parry, for example, their then-coach would always send a physically stronger person to guard me with the specific instruction to rough me up. To be honest, I never heard him say it, but you could see it in the coach’s eyes when he made the call to slow me down in the second quarter of our matchups. Those defenders never had the speed to keep up for long, though.

    Some remain lifelong acquaintances. The same thing went for Harrison College and Foundation.

    We won the Under-16 championship and knockouts that year without losing a single game.

    That is an indisputable fact. I won all of the MVP awards and was the top forward then. Those are also indisputable facts.

    Believe it or not, some of the attributes from that time in my life would come to good use as I got on in age and professional experience. For example, I tailor my public speaking style based on the audience. I’m also more willing now to accept seeing people for who they really are off the court, and without malice or bad repute.

    Translating these skills into the real world, a recent argument I had in a WhatsApp group about basketball ended up with me putting those into practice, which in turn inspired today’s article.

    Argument

    During one of our very riveting disputes about the most recent Olympic Men’s 100 meters finals, a colleague and I got into it individually. To me, we were arguing about two completely different things, and I found the argument circular and redundant. I held the view that people will use statistics to justify a call for Noah Lyles to have lost. But I had accepted that he did indeed win. The colleague argued, however, that no one CAN make that argument and it was irresponsible of me to even suggest it. So I was ridiculed for even thinking my suspicion was probable.

    It didn’t take more than two days after for someone else to use statistics to prove my point.

    However, when I realised who I was debating, I concluded that it was my fault because I should not have expected that particular person to even think through my point of view. The thing is, they are quite capable of doing so. But my experience with them throughout my basketball life suggested they would react that way. Sadly, this is also an indisputable fact that I ignored. Economists are commonly met by persons, learned or otherwise, with the contention that what comes out of our mouths must be taken with a pinch of salt. “Economists never agree with each other,” they say. It rubs me wrong given that since economics is a study of human behaviour displayed through economic interactions, it is rather complex.

    Fundamentally, how could any two economists really say the exact same thing when the underlying belief of most schools of thought is that people are rational? I know that psychologists cannot definitively agree on rationality, so I could never understand why economists take so much flak.

    That is, until recently, when I figured that maybe I should start improving on meeting people where they are at mentally and educationally. It is tougher than you think, and most professionals prefer not to do so because that in itself is rather complex. There are too many personalities to account for.

    So I decided that, for now, I’ll make a few bold statements and predictions that disregard the notion of rationality in the people I am talking about. Let history be the only determinant. In fact, let’s not even give thought to likely innovation or that history itself may be flawed. It seems like people are comforted by this. So in fewer than 300 words, I’m now able to better explain what I’ve spent the last 14 years trying to do publicly.

    Fact numero uno is that prices will always rise, especially if there is available credit and interest to be paid. It doesn’t matter how those dynamics interplay because if I explain further, you may very well rubbish that even though the premise is true.

    Accept also that inflation is imported into Barbados because we import almost every consumable item or otherwise. However, the fact that the Government believes in ensuring fairer access to all public resources for those who can’t afford it, we will always have a higher-than-normal tax burden. It’s not going to change once we all believe that our children deserve a decent education and that we all deserve public healthcare. That’s historical and indisputable.

    Tourism, for all its recently highlighted misgivings towards the industry’s employees, is and will remain our “number one” industry for some time. This is inextricably linked to the fact that we import almost everything, and we need foreign currency to do so. Tourism is by far the largest earner of US dollars, especially since we were unsuccessful in protecting the competitiveness of our international business sector.

    Another fact is that we are not as developed a nation as we think we deserve to be. Barbados is a small country with very limited and inefficient resources. Inherently, it is wrong to compare the country to cities in larger places. The availability of resources covers inefficiency in those places, so there is plenty of wastage. Nothing will change here in Barbados unless we are efficient and/or have a resource that is plentiful and is highly demanded.

    History shows this as indisputable especially when Barbados became the first 24-hour economy on the back of its world-renowned and prominent colonial sugar industry. It took time to build out resources then as well.

    Politically, there is one indisputable fact. The Democratic Labour Party cannot win the next general election, especially given what unfolded last week with those expulsions. This is indisputable and beyond reproach as a fact. Good luck to them.

    Jeremy Stephen is an economist/ financial analyst with extensive experience in private equity and economic consulting in Barbados and the region.

    Email: economistfeedback@gmail.com

    Source:Nation

  23. David Avatar
    David

    https://www.instagram.com/p/C-1Smh_p-aq/?igsh=ZjBla3Vocnp5dDRk

  24. David Avatar
    David

    An assessment of the economic report of the Governor of the Central Bank of Barbados

    On Wednesday, January 31, 2024, Dr Kevin Greenidge, Governor of the Central Bank of Barbados, presented the economic report on the performance of the economy for 2023. Despite Dr Greenidge painting a glowing picture of the macroeconomic performance of the economy and prospects for 2024, there are concerns about the interpretation of some of the data and the lack of details about key economic variables.
    The highlights of the economic report are as follows. First, two years of solid economic growth have placed the economy at its largest size in history at $12.8 billion. This was achieved as a result of 13.8 per cent growth in 2022 and 4.4 per cent growth in 2023. The growth performance in 2023 was driven by a robust performance in tourism which contributed to improved performances in other sectors through linkage effects.
    Second, the size of the economy of $12.8 billion is large enough for everyone to benefit. Third, the unemployment rate increased from 7.1 per cent in September 2022 to 8.3 per cent in 2023. Fourth, the 4.4 per cent growth not only bolstered transaction-based tax revenues but also contributed significantly to reducing the debt-gross domestic product (GDP) ratio. Fifth, private sector investment of $1.9 billion annually is required to achieve growth of 4 per cent in 2024 and a strong growth rate in successive years into the medium term. Sixth, the level of foreign reserves was $2 997.4 million or 31.6 weeks of imports of goods and services as at December 31, 2023.
    Though not mentioned in the presentation, the $12.8 billion is nominal GDP. It is well accepted by economists that in periods of persistent high inflation, the more appropriate measure of economic performance is real GDP rather than nominal GDP. Nominal output is the product of quantity and prices. Hence, in periods of high inflation, an increase in nominal GDP can be influenced by price increases in a disproportionate manner.
    This point was acknowledged by Dr Greenidge in his first presentation on the performance of the economy. On that occasion, he noted that nominal GDP reached $11.4 billion in 2022 compared with the pre-pandemic level of $10.6 billion in 2019. However, when adjustments are made for price increases, the figures are $7.6 billion and $8 billion, respectively, indicating that the economy was $400 million smaller in 2022 compared to 2019 in real terms.
    It is therefore puzzling that Dr Greenidge emphasised the nominal figure of $12.8 billion for 2023 and did not repeat the comparative analysis for real GDP in 2023 relative to 2019. Using the Central Bank data, real GDP was $7.93 billion in 2023, which is less than the 2019 figure of $8 billion. Thus, despite the nominal growth in GDP of 12.3 per cent (and real growth of 4.4 per cent) in 2023, the economy was smaller compared to 2019 in real terms.
    The suggestion by Dr Greenidge that the economy’s size of (nominal) $12.8 billion is large enough for everyone to benefit is unfortunate, insensitive and not expected from a trained economist. ECON 101 states explicitly that GDP is simply a summary statistic of the productive capacity of the economy and is an inadequate indicator of the well-being of citizens in an economy.
    An increase in GDP will not be beneficial to the majority of the population when there is a high degree of skewness in the distribution of income, when there is inadequate spending on social services, and when (re)distributional policies are not catering properly to the most vulnerable in society.
    As an architect of the International Monetary Fund-supported Barbados Economic Recovery and Transformation (BERT) programmes, Dr Greenidge ought to be acutely aware of the adverse impact of the austere economic measures on the Barbadian economy and society.
    Indeed, there has been an increase in dispossession and poverty, high cost of living and high food prices impact negatively on the most vulnerable families, and inadequate spending on health and education presents challenges in the provision of these two key public services. Also, the state of accommodation for some public officers is undesirable, and there is a pressing need to upgrade the road infrastructure and improve the distribution of water to certain areas in the country.
    The co-existence of growth and an increased unemployment rate is deserving of an explanation. It is accepted that the quantity variable (rather the price variable) in the nominal GDP calculation should have correspondence with employment, that is, the quantity variable should have a positive relationship with employment. Thus, if the nominal GDP in 2023 was influenced more by price increases rather than quantity increases, growth can occur with an increase in the unemployment rate.
    The twin phenomenon of growth and an increased unemployment rate may also be explained by increased productivity in key economic activities by existing and new workers, while more non-productive workers exit the labour market through retirement, frustration with working conditions and remuneration, and cessation of welfare-type government programmes.
    With regard to labour market statistics, it will be useful for the Central Bank in future reports to present labour force participation rates (percentage of persons within the eligible workforce seeking employment) for males and females, a disaggregation of the retirees in terms of those persons opting for early retirement and those leaving at the mandatory age, and statistics on youth unemployment.
    The tourism sector was the main driver of growth in the economy in 2023. In expounding on the tourism arrival statistics, an unusual approach was utilised by the Central Bank in comparing arrivals for 2023 with average arrivals for 2017 to 2019. Such an approach masks the peak pre-pandemic performance in 2019 and overstates the relative performance of tourism in 2023.
    A review of the tourism statistics indicates that long-stay arrivals of 636 540 in 2023 were 89.1 per cent of the 712 946 arrivals in 2019 (rather than 93 per cent if the average of 684 214 for 2017 to 2019 was used). Figures for cruise passengers were rather disappointing, with cruise arrivals in 2023 reaching 64.6 per cent of the level in 2019.
    The performance of tourism, though on an upward trajectory since the pandemic, does not compare favourably with many of Barbados’ competitors, for example, Aruba, Curacao, Dominican Republic, Grenada, Jamaica, St Maarten, The Virgin Islands, and Turks and Caicos, which surpassed pre-pandemic levels in 2022 and enjoyed new record arrival levels in 2023. Thus, the challenge of the tourism planners in Barbados is to intensify their marketing efforts in order to ensure that the 2019 peak level of performance can be surpassed in 2024.
    The practice has been to rely on tourist arrivals as an index of growth and performance of tourism. However, it is recommended that the Central Bank augments its assessment of the tourism sector through the adoption of the recent suggestion by Professor Michael Howard to employ quantitative approaches to calculate net foreign exchange earnings from tourism and the multiplier effects of tourism on the economy.
    The Central Bank report noted that the debt-GDP ratio declined from 120.3 per cent in 2022 to 115.5 per cent in 2023. With the size of the economy reaching nominal $12.8 billion, the level of public debt was $14.79 billion on December 31, 2023. Considering that the government’s debt payment obligations will amount to almost $1 billion for the financial year ending March 31, 2024, the level of debt stock of $14.79 billion at the end of 2023 is indicative of a continuation of the policy of excessive debt accumulation by the government.
    The government continues to use the policy of excessive foreign borrowing (rather than earning foreign exchange) to maintain a healthy level of foreign reserves. According to the report, the gross international reserves reached about $3 billion (or 31.6 weeks of import cover) at the end of 2023, an increase of $227.2 million over 2022. This increase in reserves resulted from an inflow of policybased loans.
    Finally, it was stated that $1.9 billion in annual private sector investment is required for the economy to achieve a growth rate of 4 per cent in 2024 and for such growth performance to be sustained into the medium term. However, the Central Bank report does not provide any information on a private sector plan to achieve the targeted level of investment. The lack of specifics on investment raises uncertainty about the economy achieving projected growth rates.
    While the news of economic growth, driven mainly by the resurgence of the tourism sector, is welcomed, the Central Bank governor is urged to temper his excitement about the economy given the following realities: unbalanced nature of growth with the economy heavily reliant on tourism, persistent high prices are contributing to the growth of nominal GDP and transaction-based taxation revenues, increased cost of external borrowing, constraining economic impact of the high tax regime, and the depressing social and economic impact of the austere measures in the BERT programmes.

    Anthony Wood is a senior economist, former Cabinet minister in the Owen Arthur administration and former lecturer in economics, banking and finance at the University of the West Indies Cave Hill Campus.

    Source: BT

  25. Bush Tea Avatar
    Bush Tea

    So ….let Bushie get this right….

    Wood is an ‘economist’ – (whatever the Hell THAT is…)
    A former Cabinet Minister (ie one of the architects of our current quagmire)
    A Lecturer at Cave Hill – (the place responsible mostly for our eddikashunal dead end )
    A recent outcast of the ruling party after not getting his own way…

    Now having been put out to pasture by HIS OWN political party, he sees it fit to share his incisive insights with Bajans on a wide range of national issues..?

    Steupsss….
    Not stinking Bushie…..

  26. NorthernObserver Avatar
    NorthernObserver

    I usually find Wood interesting. Here is someone who can produce this analysis, yet, thought debt reprofiling consisted solely of lengthening term, with seemingly no consideration of cash flow or the several misadventures of the former MoF.

  27. David Avatar
    David

    @NO

    Wood was an Arthur disciple. This is where our educated and professional classes continue to fail us, the paramountcy of the political party overrides national priorities.

  28. Bush Tea Avatar
    Bush Tea

    This is why Bushie liked Wynter Crawford.
    It is all about MOTIVES.

    Don’t come telling Bushie shiite now, just because you vex with Mia and Weir.
    How come your lips were sealed back when the lotta shiite – OF WHICH WE ARE NOW ALL AWARE, would have been known to you as a Cabinet Minister, Lecturer and ‘economist’ (whatever dat is…)???

    That kind of manipulation may work with ordinary brass bowls….
    …but NOT with stinking Bushie.

  29. Artax Avatar
    Artax

    “Don’t come telling Bushie shiite now, just because you vex with Mia and Weir.
    How come your lips were sealed back when the lotta shiite – OF WHICH WE ARE NOW ALL AWARE, would have been known to you as a Cabinet Minister, Lecturer and ‘economist’….”
    ~~~~~~~~~~

    ‘Spot on!’

  30. The OG Avatar
    The OG

    I read the article by Jeremy Stephens and wish to make some comments, but first I must compliment him. It is obvious that he is ambidextrous, otherwise it would be difficult to pat himself on the back and write this article at the same time.

    I now deal with a few points of his article
    (1) “Tourism is by far the largest earner of US dollars, especially since we were unsuccessful in protecting the competitiveness of our international business sector.”

    ***It is easy to make these broads and general statements. I would like to know how Barbados would protect “the competitiveness of our general sector”. I am no economist but I suspect many of these words mean absolutely nothing when applied to Barbados for several reasons (1) we are a drop in the pan; our existence or non existence has no effect on anything, (b) beside our small size there is a dearth of resources and here I use the word resources to mean more than natural resources. Our technology is most probably borrowed or rented and (c) the programs that we use may not be homegrown but are borrowed or lent by others.

    (2)”Another fact is that we are not as developed a nation as we think we deserve to be. Barbados is a small country with very limited and inefficient resources. Inherently, it is wrong to compare the country to cities in larger places. The availability of resources covers inefficiency in those places, so there is plenty of wastage. Nothing will change here in Barbados unless we are efficient and/or have a resource that is plentiful and is highly demanded.

    *** I see now that he gets that point. It is difficult to understand how these gentlemen can be on both sides of the fence. First they speak of a glorious Barbados and in the next paragraph say “we suck”

    (3) “History shows this as indisputable especially when Barbados became the first 24-hour economy on the back of its world-renowned and prominent colonial sugar industry. It took time to build out resources then as well.”

    *** I will be honest with you.. I don’t know what the hell he is saying here or what is his point. However, I take issue with “Barbados became the first 24-hour economy”. Some evidence should have been provided to support this claim of being the first 24-hour. Given the level of businesses and industrialization in other parts of the world I will ignore this claim. This is more ‘punching above our weight’ nonsense.

    (4) The Democratic Labour Party cannot win the next general election”.

    *** This is a claim worth watching. Why? I suspect that birds, bees, pets and other small animals have already figured this out. It will be amusing to watch him take a victory lap when this happens.,

  31. The OG Avatar
    The OG

    Mr Wood does an excellent job is discussing the contents/short falls of the economic report.
    For those of you with limited or even less ex[pertise than I have, I will spare you the effort of trying to decipher his text and provide you with the shortest of summary.

    The report of the Central Bank of Barbados needs to taken with a large dose of salt, preferably Epsom.

    I hope MR Woods will forgive my inexact summary of his text.

  32. David Avatar
    David

    Economic growth rate not the be all

    My attention has been drawn to two articles sharply criticising the most recent Central Bank report. One of the articles included comments by Carlos Forte, a Barbadian economist living in Canada, and the other was the Wild Coot column by Harry Russell.

    Forte’s main argument is that the Central Bank’s report has inflated nominal gross domestic product (GDP) and the estimate of “real economic growth rate”. I can neither reject nor support his reasoning because I have no data.

    However, I believe that the heavy boasting about the four per cent growth rate by Central Bank Governor Dr Kevin Greenidge is overdone in our small, open, developing economy, given the severe limitations of this concept and our fragile production base.

    The economic growth rate fails to address income inequality, the quality of life, or nonmarket transactions, including the underground economy. It doesn’t address environmental degradation as a result of climate change.

    Progressive development economists are more concerned with quality of life. The report is, therefore, backward in this regard.

    I have always been concerned with the problems related to the estimation of the tourism GDP. The Central Bank is never really clear about the net impact of tourism earnings on real GDP. A lot of emphasis is placed on arrivals, but the tourism GDP has to be a guesstimate, because the multiplier effects of tourism are not calculated, and the net foreign exchange impact of tourism is not known with any certainty. It’s all guess work.

    The last issue is the unemployment issue. Most Barbadians do not know how this statistic is calculated. The unemployment rate given by Dr Greenidge is quite low at around six per cent. But he never really broadcasts the high level of youth unemployment in Barbados, calculated at between 24 per cent and 30 per cent.

    Some economists believe that “full employment” of an economy is somewhere between four per cent and six per cent unemployment. How can Barbados be so near to full employment, and the Government wants 85 000 or 185 000 immigrants to come to Barbados, an economy with unsustainable output levels?

    – Professor Michael Howard

  33. David Avatar
    David

    CPDC concern about Bridgetown Initiative

    A LOCALLY-BASED COALITION of Caribbean non-governmental organisations supports the Barbadosled Bridgetown Initiative, which seeks to reform the global financial system.

    However, the Caribbean Policy Development Centre (CPDC) has concerns about what it sees as the plan’s “overreliance on debt pause clauses, heavy dependence on private sector financing and over confidence in sovereign debt restructuring”.

    CPDC flagged these issues in a recent policy brief which examined the Bridgetown Initiative 2.0. An updated version, Bridgetown 3.0, is expected to be launched in New York when the Summit Of The Future is held there next month.

    The organisation is also warning about the need to retain the Global South character of the initiative and to ensure it is “not hijacked by Global North governments, creditors and other power brokers”.

    In its policy brief titled, Relevance Of The Bridgetown Initiative – A View From Caribbean Civil Society, the CPDC recalled it was the sole voice of Global South civil society participating in a July 2022 meeting here which resulted in the first version of the Bridgetown Initiative.

    The policy brief noted that the reform proposals of the Bridgetown Initiative 2.0 “are directly relevant to Caribbean small island developing states (SIDS) which are caught in a vicious, middle-income country debt-climate change trap”.

    CPDC added, however, that “given the nature of the debt and climate finance challenges facing Caribbean SIDS, there were some concerns associated with the reform proposals contained in Bridgetown 2.0.

    Those it mentioned were over-reliance on debt pause clauses, heavy dependence on private sector financing and over confidence in sovereign debt restructuring.

    On the first issue, the report said debt pause clauses like the natural disaster clauses in Barbados restructured debt and other instruments were useful but had limitations.

    “A major drawback is that debt servicing remains and keeps on rising due to accumulated interest and extended repayment periods, while debt pause clauses may widen the risk premium impacting the country’s creditworthiness,” CPDC said.

    “As a result, Caribbean SIDS may wish to give due consideration to the use of parametric insurance for sovereign debt as an alternative financial mechanism.

    “Unlike the case of a debt pause clause, parametric insurance for sovereign debt ensures that debt repayments continue as normal in the aftermath of a natural disaster, without jeopardising a debtor country’s credit ratings,” it added.

    Regarding the call to mobilise US$1.5 trillion in private sector financing for a green transformation, CPDC argued that “over reliance on the private sector may prove too optimistic. So far, the private sector has been lukewarm, at best, in mobilising private climate finance for developing countries”.

    On sovereign debt restructuring, the policy brief said “the existing international financial system offers very few options to undertake an orderly, predictable and equitable restructuring of sovereign debt for developing countries, much less to link debt to climate change”.

    “For this reason, CPDC has been advocating for the international community to deliver comprehensive debt relief for Caribbean SIDS, through debt cancellation, debt forgiveness or debt restructuring, as a main form of climate reparations,” it stated.

    “G20 nations have a moral responsibility to help Caribbean SIDS escape the debt and climate change trap. This is because historical cumulative emissions from the developed countries spanning colonialism to the Industrial Revolution to the present day have contributed the most to the climate crisis which is impacting the Caribbean region.”

    Looking ahead, CPDC acknowledged that at the United Nations SIDS4 Conference held in Antigua and Barbuda in May, Prime Minister Mia Amor Mottley unveiled a draft Bridgetown 3.0 for public consultation.

    The organisation said: “As the Bridgetown Initiative continues to be discussed in global policy spaces and its orientation continues to evolve, it is important that its policy reform agenda remains one that favours the Global South and is not hijacked by Global North governments, creditors and other power brokers.

    “The leadership and moral authority of Prime Minister Mottley as a forceful proponent of global financial reform must be maintained. In the meantime, Caribbean civil society, especially through the CPDC, will continue to advocate for a sovereign debt and climate justice initiative that benefits the people of all Caribbean SIDS.” (SC)

    Source: Nation

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