A report in today’s Financial Times could have a damaging impact on Barbados’ image as a hub for international investment, hurting the already long economic recovery, outspoken economist Jeremy Stephen said tonight.
In an interview with Barbados TODAY, he described the perception of Government’s agreement with advisory firm, White Oak as embarrassing to global spectators.
He argued that Government’s inability to reach a restructuring agreement with foreign creditors after over a year of negotiations is now being monitored very closely by the global community. Contending that the country was relying on tremendous outside investment to kick-start its economic recovery, Stephen said the uphill battle was likely to become even steeper.
He told Barbados TODAY: “The process in and of itself has been messy. Unconventionally, the foreign investors have been left out to dry for nearly a year. At the same time, we are going into a stage where foreign investment is going to drive our recovery. The talk around medical marijuana and our competitive tax rates and the ways being used to revive our international business industry, tourism and tourism spend.
“A lot of that is driven on the basis of investor confidence. The unfortunate thing is that whoever owns the narrative and can make it seem from a global perspective that the Government is anti investment that will put dampers on attracting credible investors.
“You’re going to get investors, but they may not be credible or may not have the resources to make a positive impact on the growth potential or future growth potential of Barbados,” Stephen added.
In the Financial Times’ story entitled Barbados’ creditors fume at absurd $27m advisory fees, placed the ongoing arrangement between Government and UK firm, White Oak Advisory under the microscope.
The Financial Times report predicted that the Mottley administration was likely to pay an amount similar to that paid by Greece on a defaulted debt nearly 40 times bigger to restructure approximately $910 million owed to foreign investors.
Defending Government’s decision, which was made some months ago in parliament, Press Secretary, Roy Morris again stressed that Government would save over one billion dollars per year for the next three years. He added that Government viewed the article as an attempt to “distract and distort in order to put pressure on Government to cave in
during negotiations to restructure the foreign debt.”
He added: “it is clearly timed to coincide with the presence of an IMF mission being on the island at this time. It will not work,” said Morris.
While Stephen has not discounted the efforts of external creditors to force the hand of Government, he warned that Government needed to take its implications very seriously.
The economist declared: “It smacks of a major embarrassment no matter how you want to look at it from a political angle.
“Even if it’s true that it may be a subverted tactic, it’s a case where they would have had for some period of time clear warning that the external credit committee would try to own the narrative. If they feel discontent, they are going to air it and they have better relationships with global bodies, which can distort the global community’s perception of Barbados.”
While the economist admitted that the $27 million dollars to be paid for the services of White Oak was not exorbitant in the grand scheme of things, if certainly appeared to be a terrible overpriced arrangement.
He continued: “If you look at the percentage of the debt that was restructured, nobody has ever paid that much fees for debt restructuring ever before and its not that our situation was more complex than what occurred in Greece and I side with the external credit committee’s position in the article… It is a major embarrassment on that end.
“By any metric or rationale, the fee is outsized and unwarranted,” said Mr Newman of Invesco. “But if someone were to say, ‘hey, I’ll pay you six times what you normally get paid, would you say no?”
And we don’t have enough money for garbage trucks, transportation is abysmal and we, the people, can’t even rely on a consistent water supply because of a crumbling infrastructure.
This farce will be all over in 4 years though.
Add all this wastage of money, to the fat salaries of the 30 fat cats, and you could see where the country is being conned. They claim we have no money; the members of the former DLP Administration allegedly took all the cash and have the money in secret bank accounts.If the BLP is supposed to have been blessed with excellent lawyers, how come nobody has brought the crooks before the law courts yet?
@Pedipac: It won’t last that long. This is a T20 (2020) match. It will end in 2020, or early 2021. It can only get worse, we don’t get bad, better, best. It’s bad, worse, worst. This deception will end in this fair land, and sooner than we expect.
Even the older previously retired operatives like Ralph Jemmott, and the younger spin bowlers like my friend Roy Morriss are trying to bowl this government back into the match. Jemmott crawled out to lend his support to this lost
Mia Mottley lead administration. Roy though has been hired to spin the ball, but have found himself fighting fores. Maybe, just maybe Dale Marsall can second him to the Barbados Fire Service to resolve their crisis.
However, the horse has bolted in every race entered by the Mottley syndicate stables. Quality Jockeys are hard to come by, there are repeated stewards’ inquiries after every race, horses are facing disqualification for having overweight jockeys. Many horses seem to be outside their weight category also.
The latest horse to come under the stewards inquiry is a British bread colt named ‘White Oak’. This horse was bought for a pricey sum, with much fanfare, and boast of international quality. Now questions of racing experience have surfaced that he too seems over priced, out of depth, and totally without international handicap. Someone in these stables are buying one eyed horses that can’t even match thinker image. This person surely is not thinking, but obviously bluffing their way through a period of vital importance to the racing fraternity.
When will this stable win a race convincingly? When will it deliver on all the promise shown during exercise gallops? When will the stable find quality riders, or chose their races with care?
These horses are under-performing locally, regionally and internationally. Basically the trainers, have chosen the wrong race courses, wrong races, and weak jockeys. Though they had so many training gallops, expressed so much confidence, boasted to have recruited the best jockeys for the horses, and courses. This government still after one year on the track failed to win a race, actually the Mottley stables have failed to even lose a race convincingly.
This horse ‘White Oak’ has no track record at lingfield Park, Ascot, Aintree, or Ayr. Yet this horse was bought for 27 million, brought to the Garrison Savannah in controversial circumstances. Now the Barbados Labour Party syndicate voted in by the people of Barbados must call their leader to account. The people of Barbados once trusted in a horse named ‘Call to Account’, I think they will once more.
The punters are being asked, with expectation to back these dead horses, and are growing more frustrated after each failed race. The spectators in the stands, and the rail birds are waiting for the end of this racing season, as there has been more than enough false starts.
I myself await the end of this racing season. What next after ‘White Oak’? My grandfather used to demand an Old Oak Rum. Now I understand why. Old Oak Rum served Barbados’ economy well for decades. White Oak is already a questionable quality.
@Greengiant: Let’s hope this ends quickly. I still can’t understand why this disproportionate “consulting fee” is being paid unless there is, shall we say, a “finder”s fee” somehow attached?
The truth will be Told at some time
You can hide and buy Land but can’t hide and work it
I would like to know now how much money them Paying Lizzy to be a Propaganda Minister while loitering in the Corridors at the UN
The mere fact that the government was able to trick us and spend money which it says we don’t have, only shows us what a weak official opposition we have in Parliament. Joseph Atherley is red inside and out, and that includes his blood and bloodshot eyes. If Mia was still the opposition leader, no ruling party would have gotten away with this con move.
The economy on a Collision Course
The Country Brek
Health Care in a mess
Can’t pay Pensioners
Bus Fares or Water Bills did not had to increase
If Government can pay White Oat According to the contract between Government and the company, US$85,000 would per month to retain the services of White Oaks, meaning it would earn US$1.02 million in retainer fee per year.
BLP making the Rich Richer and Poor Poorer, We get Tricked Big Time
WE were TRICKED for 10 years and wunna weren’t satisfied,so wunna went on for a further 90 days until wunna couldn’t trick the MASSES ANYMORE…..and the MASSES were waiting for ALL a wunna…. EVERY RH a wunna GOT KICKED OUT
..yet MARK MY WORD and his ENTOURAGE of GARBAGE and SEWAGE are of the opinion that the MASSES WILL go back to DEM when Elections are called in 2023.
Dirty Harry, the reason the DLP got kicked out, is because the BLP accused that party of doing the same things the present Administration is now doing. The BLP campaigned for change, giving gullible voters like you the impression that things will not be the same if they got elected to the high office. So much for that understanding. There will soon be a shortage of eggs in Barbados for the faces of those 111,968 voters for the slick BLP, would be covered with egg yokes.