So far, the local private sector has been given an easy ride, but as the Freundel Stuart administration seeks to restructure the economy, it should be placed under the microscope.
Dean of Social Studies at the Cave Hill Campus, Dr Justin Robinson, offered this advice last night while speaking at a panel discussion sponsored by the James Tudor Institute of Politics at St Leonard’s Boys’ Secondary School, Richmond Gap, St Michael. Referring to data contained in a World Economic Forum Report, Robinson noted that at present Barbados was at Stage Four because of a per capita income of US$15,000 per annum.
“That puts you well into Stage Four with Stage Five being the highest stage. We are solidly at Stage Four trying to get to Stage Five. How is Barbados doing vis-à-vis other countries that are in Stage Four? Barbados tends to outperform other Stage Four countries in terms of infrastructure, our health, primary and higher education and training, our technological readiness, our financial market development and our labour market efficiencies. We tend to underperform in terms of the size of our market and the macroeconomic environment,” Robinson said.
The lecturer pointed out that in terms of innovation, business sophistication and goods market, Barbados tended to be “there or thereabout in the pack”.
Stressing the need for innovation and sophistication in the private sector, Robinson, the academic, said: “The real area where Barbados can get the biggest boost is in improving our business sophistication and innovation. For a long time, Barbados has been trapped in Stage Four, what economists called the middle income trap. It is like if you get to a certain level and you are bouncing around there and you cannot actually get out of that.”
Citing other statistics from the World Economic Forum Report to highlight weak areas in private sector development in Barbados, Robinson noted there were a number of procedural areas in starting a business that gave cause for concern.
He said: “We rank number 88 out of 148 countries in the number of procedural areas in starting a business. In terms of the number of days you need to start a business, we rank 78 out of 148 countries. In terms of efficiency of our Customs procedures, again we rank 64 out of 148 countries and our score is 4.2 compared to an average 4.1. So I think that these are the areas that we need to improve, that our policymakers can think about.
“These are areas where we lag, but improving those areas do not need so much money. It is not costs. These are procedural matters and it is really a matter of creativity, political and administrative will to improve these areas,” Robinson added. Robinson noted that Barbados also scored very badly in terms of the treatment of customers in a services-oriented economy. He noted that Barbados ranked 82 out of 148 countries with a score of 4.5 compared to an average of 4.6.
Robinson said: “For a service economy such a low score is completely unacceptable. Again this is an area we can make improvements without spending a lot of money. It is about mindset, creativity and the political will. Improving efficiency will only get us so far. However, to get to the next level we really have to have more sophisticated businesses and have a greater capacity for innovation.”