Government’s decision to bring Ross University may have been a masterful stroke, respected economist Jeremy Stephen has said, as the medical school is shaping up to be as big an economic engine as it once was for its former home, Dominica.
Stephen highlighted the university as one of the more substantial takeaways from the Central Bank’s latest report on the economy.
Noting the overall report gives Barbadians much to smile about, Stephen told Barbados TODAY that he was most intrigued by the prospects of growth in 2020.
He said: “The report is pretty encouraging in that the Barbados economy is forecasted to have a slight uptick in 2020 and a lot of it seems to be dependent on the performance of Ross University.
“It was referred to in the document as ‘medical educational tourism’, a very smartly put bit of language, as it appears that they didn’t want to speak to too much specifics.
“Based on what I would have read in the report, ‘medical education tourism’ was one of the major players when it came to increased tourism arrivals over the first nine months of the year.
“This sector also largely accounted for increased tourism spend.
“The largest and newest of these players is Ross University.”
The economist noted that while he is on the fence as to whether Ross University students classify as tourists, the development was certainly a good sign for the economy.
He also pointed to the re-exportation of goods as helping with the country’s overall export earnings.
Stephen told Barbados TODAY: “I have said for the last ten years that trans-shipment is the big opportunity that Barbados has in the near future and it is interesting to see this now.
“I am hoping that it is not an anomaly but rather an emerging trend.”
The central bank report said the economy declined by an estimated 0.2 per cent so far this year, owing mainly to delays in private sector investment projects and budget cuts in public spending, which eroded the gains made in the tourism industry.
Stephen contends that even this could be viewed as the glass being half full, adding that based on the country’s ongoing debt exercise, one would not be faulted for anticipating a larger fall.
He said: “The economy did not fall by as much as one would expect considering that we are under a debt exercise.
This includes not just the debt restructuring but the IMF programme as well, so this means that the entire economy is being restructured and one would expect a bit of a falloff.
“This was compounded by the fact construction and unemployment numbers are going in directions that we do not want.
“We are going through an IMF programme and you do not necessarily grow while that is going on.”
But the outspoken economist noted that while there was certainly much to write home about, there were troubling and areas which should be urgently addressed. Topping his list of negatives was low capital expenditure.
Stephen said: “Capital expenditure is part of the way the economy would grow but unless I am reading the report wrong, capital expenditure increased by just $10 million from the same period last year, despite the flagging standard of infrastructure that we do have.”
He further pointed out that the economic report shows that less money has been spent on fuel imports and since Government was the majority importer of fuel into Barbados, one could surmise that the difference at the pumps was much more than just the fuel tax.
“This would certainly justify a lot of the anger people are having with respect to cost at the pumps despite continued suppression of prices internationally.
“It is my hope that those monies would be accounted for in the public coffers and go toward capital expenditure,” he stressed.
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