We are in the post 2025 ‘budget’ period and the usual pundits have been flooding the media space with economic analysis. As usual most of the debate can be sorted by who are pro B or D. An unfortunate state of affairs given the country’s heavy investment in education. To be honest it seems all very ‘déjàvuish’.
During the COVID 19 pandemic the BU intelligentsia expressed hope that by refusing to let a good crisis go to waste, a level of innovation and creativity would emerge to disrupt traditional thinking at every level in society. Four years later the Barbados economy is chugging along, business as usual with increased addiction to consumption behaviour. Tourism is booming and there is great joy in the land.
Cursory research highlights that while increased consumption can drive economic growth there are more sustainable pathways Barbados must pursue. Being a net importer translates to a trade deficit and therefore a demand for foreign exchange that we earn mainly from the fickle tourism sector.
In recent months Prime Minister Mottley, Governor of the Central Bank Kevin Greenidge and newly appointed President of the Caribbean Development Bank have requested individuals and private sector to invest in the country. Since the selected default in 2018, a conservative and risk averse Barbados has reacted unenthusiastically to he call.
We have been beerish to the call to invest in the country, what are we doing therefore to generate exports in order to earn to pay for our addiction to consumption behaviour? It is no secret tourism characterises our one leg economy. There was an attempt to expand agriculture production with crops that were quick to harvest, it seems several reasons have caused the project to fail. In fact Dr. Clyde Mascoll confirmed recently the challenge to sustain agriculture production is hampered by comparative high production cost.
To be expected it has been left to government to spend on road repair, building houses and other infrastructure jobs to generate economic activity. Our inability to drive efficiency through the use of technology for example has been a blocker to achieving material improvement..
The blogmaster is fearful that over reliance on consumption will lead us up a creek eventually. This path will continue to fuel our debt problem and other economic ills will plague the country. We have to find away to discover other growth measures to support consumption. Other sectors must emerge to compete with the retail and distributive sectors. There is a cost to sitting on foreign reserves as Anthony Wood has explained. Especially if a significant percentage is borrowed.
Underlying all that is required to build a sustainable and resilient economy is the behavioural change that is required from residents of Barbados. It cannot be right to aspire to drive a 140k SUV or twin cab on a 21×14 island. The fact that we are said to have over 130k vehicles in Barbados, resulting in hours spent daily by inching our way on potholed roads, translates to serious infrastructure and planning issues. How can we develop Barbados with obvious transportation inefficiencies and infrastructural decay?
The blogmaster invites you to join the discussion.