President of the Barbados Chamber of Commerce and Industry (BCCI) Eddy Abed is calling on the Freundel Stuart administration to “immediately” implement recommendations from the Social Partnership working groups on the foreign exchange reserves and the fiscal deficit.
Warning that Barbados did not have time on its side, the business executive painted a damning picture of the economy, pointing out that with dwindling reserves, high debt, the continued printing of money by the Central Bank to support Government, and very little results from Government’s austerity programmes, the country was going in “the wrong direction”.
He also expressed concern about Government’s funding from the National Insurance Scheme as well as Government arrears to the private sector.
“We are going in the wrong direction with only over-optimistic promises to comfort us,” Abed wrote in the BCCI’s monthly newsletter.
The business executive said although the BCCI remained optimistic that a solution could be found, the current buzzwords among business officials were “uncertainty and lack of confidence”.
“They are non-tangibles that require a robust and courageous demonstration that the recommendations of the fiscal deficit and foreign exchange tripartite working groups will be implemented immediately,” the BCCI head said.
The two working groups set up to advise Government on the way forward for the ailing economy submitted their reports to Stuart at the end of last month.
The Barbados Government Information Service (BGIS) in a release Wednesday said the Prime Minister had commended the work of the two groups.
“The recommendations made are being studied with a view to determining which proposals can be implemented in the short term and which are more medium term,” the BGIS quoted Stuart as saying, adding that he had given the assurance that “the appropriate sense of urgency is being brought to bear on the consideration of the report”.
In the newsletter article, Abed insisted that while the private sector had exhibited maturity, patriotism and responsibility in maintaining investments and employment levels of well over 100,000, it came at a cost of “lower profit levels and reduced capital investment in new and existing ventures as our economic future is at best, uncertain”.
He said governments, like businesses, must be prudent to balance expenditure with revenue, but this was far from the case now in Barbados.
“When revenue falls, courageous decisions must be taken to protect the most vulnerable in our society while ensuring that the geese that are laying the golden eggs are not over-taxed. Sadly, this calamitous situation has continued unabated and the results are everywhere to be seen,” he said.
The BCCI head said sadly, the last eight years of austerity had not cured the country’s macroeconomic ills.
“For all of their good intentions, Government’s strategies have had limited success, if any at all. Consequently, I am fully aware that there will have to be further austerity and I fear that the medicine will most certainly be bitter,” Abed said.
“Opportunities will however abound for Barbadians to invest in local gems that are scratched and maybe even chipped but can shine again if properly managed and capitalized. I am also aware that the entitlements that many have taken for granted for the last two generations must be reviewed and a buffet of options guided by means testing, user fees and outsourcing will have to be embraced,” he recommended.
But the “toughest obstacle”, Abed said, would require “a reboot of our generally poor customer service and woefully low productivity in both the private and public sectors.
“The solutions to poor attitudes and service in the workplace are numerous but must surely start with training and setting benchmarks so that the organizations can be incentivized, not only to meet these targets but be rewarded for surpassing them,” he suggested.
Abed said he was comforted to know that there were areas in which the private sector could participate and achieve growth despite the economic challenges.
“Technology, tourism and related services, international education and healthcare services and the international business sectors remain the low hanging fruit that can and will deliver the greatest return for our investment. These investments need to be nurtured, given incentives and most importantly bureaucracy should be kept to a minimum so as to ultimately provide our country with foreign exchange, quality jobs and a path to a sustainable future,” he recommended.
“I must admit that I remain optimistic about our future, yet frustrated that month after month this Chamber has communicated either directly with the relevant authorities, or broadcast widely, many suggestions to cut Government’s expenditure, grow the economy, increase the ease of doing business and recently, I am informed, that we were criticized for not offering any problem solving inputs. I do hope that I received inaccurate feedback as the integrity of a 195-year-old institution, the BCCI and its members, would be sullied for no other apparent gain than politics,” the BCCI president said.