The best way to measure the impact of economic crises brought about by issues such as natural disasters or recessions is to take a closer look at how it affects the most vulnerable people daily.
Minister in the Ministry of Economic Affairs and Investment Marsha Caddle made this assessment as she addressed the opening of a two-day retreat for staff of the United Nations Development Programme (UNDP) in Barbados and the Caribbean at the Barbados Hilton.
Caddle, who previously worked with the UNDP, said that while Gross Domestic Product (GDP) was an important economic measure, it did not always accurately reflect the real state of affairs in a country.
“Economics is about the provision of goods and services to improve people’s wellbeing; not only about numbers, but matching people’s wellbeing and access to opportunities with resources,” she explained. “For example, a country can have high levels of GDP but high levels of debt so it cannot make crucial investments. We had that problem in Barbados in recent years, where, because of unsustainable levels of debt, we had almost zero resources to invest in infrastructure and other critical areas.”
Caddle noted, however, that since implementing the Barbados Economic Recovery and Transformation (BERT) programme over the past 18 months, Barbados had improved its ratio of debt to GDP considerably.
“We closed our domestic debt exchange successfully and are doing well on our international one. Initially, we reduced our debt to GDP ratio to 176 per cent and by December 11 this year, that was down to 118 per cent and falling.
“We got great response across the board with the debt exchanges we launched. The take-up has varied from about 85 per cent for one of the instruments to the mid-90s for the others and 100 per cent for two, so these people have recognized that we are serious about our restructuring.”
Meantime, Caddle said she has so far learned some significant lessons in making the transition from working for a UN agency to becoming directly involved in managing a country.
“The biggest lesson for me is, what may be relevant today has to do with the extent to which you have to pair support to government systems and how they function. We often have a notion of what our ideal system looks like, but governance is about priorities and choices, and I believe it is important as a UN system to be able to see and understand where countries are in a particular objective and be able to fill the gaps,” she said.
“As international development practitioners, we cannot only concentrate on what is important on the global and regional level, but we must also understand the everyday dynamics on the ground, what people are experiencing. When I came to the UNDP, we were doing community-based work, and the value of that was you understood how policies were impacting on people every day, so you saw what you needed to correct or adjust. And as a politician working on national policy, you also get to see the evidence of how it is working or not working.” (DH)
