Barbados is not at the bottom of the economic totem pole!
This assertion today from Prime Minister Freundel Stuart in light of a new International Monetary Fund (IMF) report that puts the island behind Haiti, Guyana and several other regional countries in terms of growth projections for this year and next year.
“Now when you say to me that Barbados is at the bottom of the totem pole in the Caribbean, I do not think anybody in the Caribbean who hears that will be persuaded by it,” said Stuart, in responding to the latest IMF report.
“Barbados is certainly not at the bottom of the totem pole in the thinking of the people of the Caribbean,” he stressed.
In the report, entitled Regional Economic Outlook For The Western Hemisphere, the IMF predicts 0.8 per cent economic growth for Barbados this year and the 1.6 per cent next year. This compares poorly to the IMF’s projection of 3.3 per cent growth in 2015 and 3.8 per cent in 2016 for Haiti.
Moreover, the IMF is forecasting growth in order of 3.8 per cent for Guyana this year and 4.4 per cent next year.
At the top of the IMF’s Caribbean growth table is the Dominican Republic, which is expected to record robust economic growth in the order of 5.1 per cent in 2015, and 4.5 per cent in 2016. Energy-rich Trinidad and Tobago, which was recently downgraded by Moody’s, is expected to grow by 1.2 per cent this year and 1.5 per cent in 2016.
The latest IMF growth projections also contradict the Central Bank of Barbados’ forecast that the economy will grow by between 1.5 per cent this year and two per cent next year, based on the strength of the country’s tourism performance and further private sector investment of approximately $700 million.
However, in downplaying the IMF report, Stuart said he did not subscribe to the view that the IMF officials commanded any “magisterial credibility, accuracy and perfection”.
“I really do not subscribe to any of that, but they are institutions to which we belong. We have to respect them, but I do not believe that they have perfect solutions to anybody’s problems. Had they had them [solutions], this current crisis was the best opportunity to show that they had them,” Stuart argued.
In a further attempt to quell fears among Barbadians, the Prime Minister also assured that the island was “certainly not at the bottom of the totem pole”.
“If we are not projected to register economic growth at the rate at which other countries in the Caribbean are likely to register, that has to be put in the context of where we are coming from and where they are coming from,” he explained, as he reminded Barbadians that in terms of domestic indices, human development and infrastructure, the island continued to do very well when compared with other Caribbean countries.
While acknowledging that Haiti was expected to grow by 3.3 per cent in 2015, the Prime Minister emphasized that one must look at where Haiti was coming from.
“I am very glad that Haiti is beginning to experience a serious turn around. We all have a vested interest in the success and development of Haiti, so too are our brothers and sisters in other parts of the Caribbean, some of whom are in IMF programmes and have had to walk a very tight line. A country like Jamaica is now in its seventh or eighth IMF Programme since the 1980s,” he noted.
However, in the context of the entire Caribbean, the Prime Minister said: “I don’t think that Barbadians have anything to be ashamed about. We know that we have been going through some challenges and that we have to try and work our way back to where we want to be and that we are doing. I don’t think that there is any need for despair,” he said, noting that there was a time when no growth was being predicted for the island.
Therefore: “If growth is being predicted now, it means that we are doing something right and we are doing something right in the context of very difficult global circumstances,” he said in defence of his Government’s economic programme.
Stuart’s words of comfort come in the face of the ongoing fiscal consolidation programme, which has already resulted in the loss of 3,000 public sector jobs and several other expenditure cuts.
Speaking to reporters shortly after officially opening the Youth in Agriculture Programme Phase 8 in Bayville, St Michael, the Prime Minister pointed out that economic growth had been a scarce commodity across the Western world over the past six to seven years.
He said he recently heard that the Federal Reserve of the United States had to downgrade its forecast for the economy for the remainder of the year because in the last quarter it grew by about 0.2 per cent.