Government’s defence of UK-based White Oak consultancy to restructure the country’s foreign debt, citing inadequate local expertise, was slammed today as “irrelevant” by the Opposition politicians.
The team of senators and party spokespersons who are to be formalized into a political party in two weeks, declared that Government’s lack of local alternatives, shed no light on the rationale behind the $54 million price tag for the two-man advisory team.
Speaking at a press conference at the Opposition wing of Parliament on Tuesday, spokesman Scott Weatherhead suggested that Government took a cavalier approach to a matter, which could have dire consequences later down the road.
“The sum should have been negotiated better…. [Government] did a poor job of negotiation. Maybe they didn’t negotiate at all, maybe there are reasons for not negotiating.”
He pointed out that White Oak’s bill was equivalent to ten per cent of the country’s loan from the International Monetary Fund.
The entrepreneur also accused Government of being less than transparent with the process.
Weatherhead told reporters: “Whether it could have been handled locally is irrelevant. Whether there was no experience locally to tender on the debt negotiation, may be so, but we never saw a tender.
“So perhaps the right way of doing things in the interest of transparency was to put the contract out to tender, receive some responses and then advertise that a suitable person was not found locally and that they were going to seek international expertise.
“They [Government] should have announced their choice and negotiate the best possible price for the job.”
The criticism stems from Chief Economic Counsellor, Ambassador Dr Clyde Mascoll’s dismissal as “ridiculous” the notion that a local economist or firm could have done the job. He also addressed White Oak’s failure thus far to negotiate a settlement for the approximately $3 billion in debt owed to external creditors.
“The notion that there is a Barbadian who is qualified and has been restructuring debt is not known to me and if there is one, then that person can step forward.”
Adding his voice to a chorus of Government officials defending the White Oak deal, he stressed that 80 per cent of the gigantic debt owed to local creditors was successfully restructured late last year but admitted that negotiations for restructuring the external debt could continue to be challenging.
“On the external side, those people don’t have that kind of affinity for the Government of Barbados. They are purely capitalists and they invested to get a greater return… so yes, there may be some fallout from not being able to negotiate the external debt as fast, but it is not even a year yet and normally it takes longer to do external negotiations,” he said.
But Weatherhead argued that Mascoll’s defense of the time that the negotiations were taking, raised more questions than it answered.
The Opposition spokesman, who ran on Solutions Barbados ticket in the May 24 General Elections, said: “I think that when you are talking about the kind of debt that Government is trying to negotiate, it is not a small sum and there are a lot of creditors.
“So, if a debt negotiator was tendering on that, they would have needed time to understand what is involved in that negotiation. A lot of due diligence should have been done before someone could say this is what we are going to charge.
“So, it’s either possible that process happened prior to election that this company knew that they were going to be appointed after the election last May or they had no idea what they were getting into and quoted a high amount. We can’t speculate at this time, but we can say that the process was not transparent.”