by Marlon Madden
The increasing number of people going into isolation due to the COVID-19 virus is wreaking havoc on the local business community, which is now facing a continued reduction in productivity and diminished business activity as a result.
At the same time, business operators are growing increasingly despondent having to battle a range of challenges that are proving to be unsustainable, including high taxes and the lack of ease in doing business.
Executive Director of the Barbados Chamber of Commerce and Industry Misha Lobban-Clarke told Today’s BUSINESS there were a number of challenges that the new Government could help them to address in the short to medium-term.
This, she said, included mitigation against the impact of the COVID-19 virus “from the perspectives of its impact on productivity, consumer spending power and the island’s attractiveness to tourists”.
“Additionally, the cost of doing business has to be addressed as it relates to energy cost and the cost of imported items. Government needs to focus on ensuring a business-friendly environment in Barbados and its ongoing digital transformation initiative should help,” said Lobban-Clarke.
According to business operators in the retail and distribution sector, which is the largest sector and percentage of the BCCI’s membership, other immediate challenges facing the business community that need to be addressed include the cost of capital, fees on debit card transactions and large deposit fees that commercial banks are to put in place, high shipping costs, demurrage and duties.
“Government should consider limiting duties on freight or, better yet, remove duties from freight altogether so in order to lower the cost of goods imported into Barbados and therefore reduce the high cost of consumer goods,” said Lobban-Clarke.
Additionally, the business community is urging the new Mia Mottley led administration to refrain from introducing any new taxes as it continues to work towards meeting targets under the International Monetary Fund (IMF) programme.
“We in the private sector must advocate for no new taxes as many businesses are unstable and will need years to rebuild and ensure their sustainability,” said Lobban-Clarke.
Pointing to the impact the COVID-19 pandemic was having on businesses as it persists and numbers continue to rise, Lobban-Clarke said there have been significant disruptions in food supply and availability of goods from international suppliers and the significant increase in cost of goods to consumer due to higher import costs.
The private sector is also reporting concerns about the mental health of the workforce due to the prolonged pandemic, which began to affect the island towards the end of February 2020.
“Government needs to double down on its vaccination efforts and get people back at work and the kids back in school,” said Lobban-Clarke.
Home isolations due to COVID are wreaking havoc on businesses and business activity as they have had to be working with reduced staff complements, which is resulting in decreased productivity.
Some businesses are also experiencing loss of revenue as employees placed in isolation are still being paid and is a cost to businesses especially if some employees cannot work remotely,” she explained.
“There is serious loss of manpower/work hours and productivity due to extended days the employees are out due to the length of time required to secure testing results and the length of time to receive clearance certificates from the Ministry of Health.
Loss of manpower and disruptions to business activity because employees have to be in selfquarantine/home isolation who are unable to work remotely from home,” she added.
As the Barbados Labour Party administration settles back into place, the private sector operators are calling for greater focus to be placed on making it easier for them to do business across central government and for greater use of innovation and information technology across government agencies and departments.
Outlining some of the measures they want implemented, the BCCI members said they would like more avenues to do business online, including the granting and issuing of licences and permits.
“Consideration should also be given to prioritising the rationalisation of the numerous state owned entities that are either overstaffed, duplicated by another state agency or no longer relevant,” said Lobban-Clarke.
She also pointed to the need for fast-tracking licences and permits for new business investments in the green energy sector and other new investments start-ups; reduction in the high cost of living by recalculation of CIF on goods imported to Barbados; implement the long-awaited electronic single window for imports and exports and rationalise port operations to lower cost and increase efficiency; and move to a 24-hour operation at the Bridgetown port.
The business community also wants to see increased access for importers to the green lane programme and risk assessment that is standardised across respective agencies for green lane containers as well as better controls on under-invoicing at the ports of entry.
They believe there are additional opportunities for tax-free sales days in retail, the development of more aggressive strategies to encourage greater investment in manufacturing, fisheries and agriculture and allow for diversification of economy, increased earnings in foreign exchange and overall decreases in the country’s import bill.
“Develop more aggressive strategies to increase adoption of solar PV and electric vehicles. The Government, for example, can offer incentives for people to switch from oil burners and/or reduce the import duty and excise taxes especially on commercial vehicles,” said Lobban-Clarke.
“We are all aware of the typical IMF mandates of fiscal prudence but of greater concern will be how does Government earn revenue to pay down its debt incurred during this ongoing COVID pandemic,” she added.
She advised against the pitfall of not sharing information on policies that require private sector implementation, adding that the private and public sector should make customer service endemic and improve the slow pace of implementation across the sectors.