Government is proposing to establish a “comprehensive national fiscal, economic and social development restructuring and enhancement programme” by October this year, to guide decisions for a short, medium and long-term growth plan.
Delivering the 2017 Financial Statement and Budgetary Proposals on Tuesday, Minister of Finance Chris Sinckler said the final touches were being put on the new programme, which he said was decided on following the recommendations from the two working groups set up by Prime Minister Freundel Stuart early last month.
With the country’s foreign reserves having plunged to $681.1 million, or 10.3 weeks of cover at the end of last year, the foreign exchange committee had recommended, among its list of proposals, a hike in cruise visitor head taxes and airport departure fees.
Another worrying issue for the Stuart administration is its fiscal deficit, which ended the last financial year at an estimated six per cent of GDP, higher than the projected 5.8 per cent. The fiscal deficit committee had therefore included in its deficit reduction proposals the sale the Barbados National Oil Company Limited and the National Petroleum Corporation.
However, Sinckler said while some of the proposals of the working groups could be implemented immediately to assist in addressing some of the economic challenges, the majority of them were of “a more medium term focus” and would definitely require “extensive” stakeholder and national consultation.
“To this end Sir . . . the Ministry of Finance and Economic Affairs is putting the final touches on a comprehensive National Fiscal, Economic and Social Development Restructuring and Enhancement Programme, which will be published in the coming weeks and serve along with all of the other proposals which Government has received as the centrepiece for the national discourse which must take place this summer to chart a short, medium and longer term agenda for growth and development of Barbados’ economy and society,” Sinckler announced.
He said the new programme, which is being crafted by the Planning Division within his ministry, would set out “a clear and concise national plan aimed at addressing several of the key areas of restructuring which this economy urgently requires”.
It will focus on a number of areas, including boosting the foreign exchange earnings “through creating more attractive conditions of foreign direct investment by the standardization of investment incentive regimes in an omnibus incentives legislation, and reforming the platform for implementing mechanisms across the public and private sectors,” Sinckler added.
He said attention would also be on reform of the country’s productive sector by focusing on reducing the cost of doing business in critical sectors such as agriculture, manufacturing and tourism, while finding appropriate mechanisms to capitalize on emerging sectors, including the cultural industries.
“There will also be concentration on instituting a Competitiveness Commission and Operational Unit to drive implementation of the work currently being undertaken by the tripartite Competitiveness Action Teams; implementation of the new national energy policy to accelerate the Government’s plan to make Barbados energy independent by 2035; fiscal consolidation through public financial management reform, including, the passage in Parliament of a new Financial Management and Audit Act to govern the financial affairs of Government statutory boards and enterprises; state-owned enterprises reform, including mergers, operational consolidation and divestment,” he said in outlining the broad parameters of the programme.
Attention will also be placed on completion of the tax policy reform and tax administration upgrade project, including the final transition of Customs into the Barbados Revenue Authority and the implementation of a single taxpayer IT system.
Additionally, emphasis will be placed on debt growth stabilization and reduction through fiscal reform and debt management enhancement, including debt profiling and social sector reform in critical areas such as health, education, sanitation, social care services and environmental protection.
“Our hope Sir, is that before fall this year, this Parliament and the country as a whole will have a comprehensive, well thought out and extensively consulted national plan which can be debated here and approved for immediate implementation by the Government,” Sinckler added.