Minister of Finance Chris Sinckler today reported that the sale of the Hilton Barbados Resort, which is valued at more than US$100 million, was at “an advanced stage”, while accusing the local Fair Trading Commission (FTC) of stalling a similar size deal that is viewed as critical to the island’s economic recovery.
The Freundel Stuart administration has been banking on the sale of the Barbados National Terminal Company Ltd. (BNTCL) –– which is owned by Barbados National Oil Co. Ltd. (BNOCL) –– to the Sol Group.
However, the US$100 million sale is now tied up in the law courts after Rubis challenged the sale which is yet to be approved by the FTC.
Without making reference to the court process, Sinckler today expressed frustration over the length of time it was taking the regulator to render a verdict on the matter.
“I believe the Minister of Commerce [Donville Inniss] has indicated . . . gently I am sure . . . to the FTC, that the issuing of its final decision on the state of the sale of the BNTCL is now long overdue and must be done expeditiously, whatever that decision might be,” Sinckler told participants in this morning’s annual conference of the Institute of Chartered Accountants of Barbados.
“It is simply taking way too long in my opinion and frustrating all parties involved and potentially jeopardizing our economic plans,” he said, while seeking to make it abundantly clear that at this stage, he was less concerned with what its decision will be, than the fact that “after near nine months [and] no decision has been made”.
He stressed that the FTC needed to issue its ruling “so we can move on”.
And without giving any details on the Hilton sale, which was first announced in his Budget speech back in May, Sinckler said the sale of these assets, together with a short-term loan now being negotiated, would give a one-time major injection into the island’s foreign reserves, if executed in a timely manner.
Sinckler also suggested that the expeditious conclusion of these transactions would also give the country the breathing space it needed to address the medium and longer-term challenges with foreign exchange earnings and retention for the island as a whole.
Today Sinckler also sought to reassure members of the local business community that even though the level of foreign reserves was way below the 12-week import cover, the stability of the dollar was maintained.
“It is true that a healthy reserves position is the bedrock of maintaining the desired peg against the US dollar and, as I highlighted before, our reserves have declined to a less than comfortable levels. However, reserves of just above eight weeks of imports are yet enough to defend the local currency,” he said.
The Minister of Finance also explained that Barbados still has access to second-tier reserves which are held by other financial and commercial institutions that could be tapped into if necessary.
“We do not anticipate that such a move would be necessary and to ensure that this will not be the case, we, the Government that is, are working with the Central Bank on a number of fronts to boost the reserves in the short term as we move forward,” he stated.
Today, he also called on the private sector to play its part in ensuring that there could be an economic turnaround.
“In this regard, while Government is going to play its role in trying to stabilize the situation in the near to medium term, it would be remiss of me if I didn’t call upon the leadership of [the Barbados Private Sector Association] to in turn call upon the members of all its various organizations to assist the country at this critical time by bringing more of their foreign earnings onshore and even redeeming some with the Central Bank of Barbados,” Sinckler said.
“I am sure the members of your organization would agree with me that such a move would be yet another great demonstration of commitment to the success of Barbados and Barbadians by our private sector. So there will be no devaluation of the Barbados dollar,” he emphasized.