A Barbados Labour Party (BLP) Government would do anything that is “legal and moral” to drag the struggling economy from the brink, BLP leader Mia Mottley has vowed.
Mottley did not say if this included an arrangement with the International Monetary Fund (IMF), although the BLP has said in the past it would consider a homegrown programme based on an IMF model.
In fact, the international lending institution was not mentioned at all while she fielded questions today at the monthly business luncheon of the Barbados Chamber of Commerce and Industry (BCCI) at Hilton Barbados Resort this afternoon.
However, in response to a question about engaging multilateral organizations, the Opposition Leader made it clear the BLP would do whatever was necessary to get the job done.
“We will do whatever is legal and moral to fix this country,” Mottley said.
“You are asking me to specifically say whether it would be a multilateral cooperation to absorb all of our foreign debt in one place. I don’t think that’s how it’s going to work. But there will be engagements at an international level because Barbados cannot get out of this hole on its own.”
The IMF, which completed its two-week Article IV Consultation here yesterday, has issued its preliminary report in which it said the chances that the Freundel Stuart administration will achieve its deficit target this year following Minister of Finance Chris Sinckler’s presentation of a $542 million austerity package back in May, were slim to none.
The Washington-based funding agency suggested that Government should aim instead for a 7.5 per cent gross domestic product (GDP) surplus by financial year 2020/2021 instead of the administration’s stated goal of a 4.4 per cent surplus in financial year 2018/2019, and said the fiscal measures announced by Sinckler, which included a whopping increase in the National Social Responsibility Levy (NSRL) from two to ten per cent, an introduction of a new sales tax on foreign currency transactions and a hike in the excise duty on fuel, would likely fall short of its overall target due to exemptions to the NSRL, lower-than-expected non-oil imports, shortfalls in some other revenues, and high transfers.
Equally disconcerting for the administration, the Fund also warned that the country’s international reserves, which stood well below the recommended 12 weeks benchmark at just 8.6 weeks of import cover, or $549.7 million at the end of September, were likely to dip even further by yearend as Government continues to service its debt, and private foreign inflows remain weak.
In this context, it reiterated its willingness to help Government, “including through continued policy dialogue and technical assistance”.
Mottley today compared the economy to a burning building, which continued to blaze while people conversing without calling firefighters.
“We have been reduced by waiting with problems enduring so long . . . the house is on fire . . . half of the house is on fire . . . nobody has called for a fireman. But we have these conversations on the outside of the house that is on fire without realizing that the conversations themselves cause more fire to move at a quicker pace,” she said, while repeating that Barbados must be brought back from the economic brink at all costs.
In her wide-ranging presentation, the BLP leader promised to amend the National Insurance Fund investment guidelines, contending that there currently was too much concentration on Government.
She also made it clear that a BLP administration would scrap any “inopportune or improper” decision made in the “dying days” of the Freundel Stuart administration.
Some of these decisions, she said, revolve around appointments of a new Governor General, Central Bank Governor and Director of Public Prosecutions, as well as the services commission.
“These are all posts that are either in the Constitution or serious posts that will affect the quality of life and the quality of decision-making in Barbados. Now if people only allow the Opposition to be the only voice on these matters, then the Government will fill them with impunity and you will be stuck with whomsoever they choose,” the BLP leader stressed.
“And remember, if they then reappoint with impunity in the dying days of a Government we are then stuck as a country with the consequences thereto . . . and if we are not, there is a price to be paid.
“I can only say to you . . . we cannot seriously consider ourselves bound by any inopportune or improper decision made in the dying days of this administration that will extend its protection to people who ought not to be protected. I say no more,” Mottley warned.
The Opposition Leader, who was accompanied by her parliamentary colleagues, also promised that a BLP administration would make the Central Bank, the Auditor General and the Statistical Department independent where they would no longer have to go through a minister for their financial votes.