Noted economist Marla Dukharan has thrown her full support behind calls by the Central Bank of Barbados for a ramping up of measures to reduce the island’s economic vulnerabilities and for both Government and the private sector to emphasise technology and green energy.
Her comments follow Governor of the Central Bank of Barbados Cleviston Haynes’ review of the Barbadian economy in 2020.
Haynes said renewable energy had the potential to contribute to the island’s long-term competitiveness and net foreign exchange earnings, thereby helping to reduce its economic vulnerabilities.
“Central to further reducing our vulnerabilities will be how we adapt our use of technology in everyday life. The innovation and entrepreneurial spirit emerging out of the pandemic demonstrated the resilience of our citizens during difficult times,” said Haynes.
“However, to facilitate the growth of business, whether small or large, we must progress our digital efforts including in banking, payments, tax collections, document management and education. Let us use this period to ramp up our focus, not only to help us navigate this period, but also to prepare us to be more competitive in the new environment.”
Declaring that she fully agreed that this renewed and increased emphasis was needed to help organizations survive the current and post COVID-19 environment, Dukharan told Barbados TODAY it was time governments and businesses recognized that “the world has changed forever, and in ways that we don’t yet see or understand”.
She said: “We are about ten months into this pandemic. Any private sector entity or Government that has not adjusted the way it does business, has not innovated, and is just waiting passively and impatiently on the return of traditional tourism-related activity, has wasted time, has done itself and its stakeholders a huge disservice, and is not likely to fare too well going forward.
“We can’t afford to rest on our laurels and wait for a return to business as usual. All is not lost. It’s not too late to wake up and shake up, pivot and prepare for a new future.”
Recalling how the 9/11 terrorist attacks resulted in significant changes, especially in travel, airport security checks, legislation to fight money laundering and the financing of terrorism, she suggested that changes brought on by the current health pandemic could also be long-lasting and even continue to evolve.
Dukharan explained: “These shifts [from 9/11] that affect our lives even today, and maybe forever, have their roots in that event two decades ago. Similarly, the International Monetary Fund had conducted research on the impacts of hurricanes and found that in the Caribbean, the impact of an average storm, roughly category 3, can be seen in the macroeconomic data, even 20 years following the shock.
“So the point I am making is this – those shocks change the way we live, for 20 years and more. This shock, the depth and breadth of which is greater than any crisis previously recorded in history, and was the world’s first sudden-stop, has and will continue to change the way we live and work, and the way our economies operate and perform, in the most dramatic and lasting ways ever known to man.”
As such, she said it would be “naïve at best, for us to think that we could wait for it to pass so that we can resume life as usual”.
The regional economist said while it should be accepted that some fundamentals would not change much, there were some areas that government and businesses should increase focus.
“I would like to suggest that, as the Governor stated, alternative energy, digitization, and other reforms are crucial to our survival in the current and future socio-economic environment,” she said.
“We have done a great job in this region of promoting the idea of ‘pivoting’. But how many businesses really have? How many tourism-related businesses in Barbados and across the region have innovated or ‘pivoted’ to, for example, look more towards ‘welcome stampers’ versus waiting for the traditional tourists to return? How many have looked more towards staycationers and regional tourists versus extra-regional? How many have re-imagined their operations to capture the opportunities inherent in the current environment?”
Earlier this month, Dukharan questioned why there had been minimal movement on the expansion of other industries besides tourism.
Pointing to several businesses including the conglomerate Goddard Enterprises Ltd, Dukharan said they have been able to pivot during the pandemic to diversify their product offering or cater to a different market segment.
“One would think that a massive entity like Goddard’s would be slow to respond and/or innovate compared to a smaller, nimbler entity,” said Dukharan. “But this is what sound leadership looks like. This is what empowered decision-making and adaptation does. And this is the essence of my point.” ([email protected])