A top official of the umbrella body responsible for global business in Barbados says he is not expecting any direct impact on the island’s international business sector as a result of the Russia-Ukraine conflict, but warns of indirect shocks on the wider economy.
President of the Barbados International Business Association (BIBA) Derrick Cummins said he was keeping a close eye on the development, cautioning that although Russia was not a country from which Barbados gets a lot of global business, firms will still need to pay attention to the various sanctions being issued on that jurisdiction, its businesses and individuals.
At the same time, Cummins said he believed the global business sector here could play a role in helping to cushion the economic shocks that were likely as a result of the conflict.
“As war escalates in Eastern Europe, the Barbados economy braces for further shocks. Once again, having a sector of the economy that is well diversified in professional services, insurance, banking and wealth management, financial technology, pharmaceuticals, renewable and more, can and will help spread the risk around,” he said.
Cummins pointed to increases in oil prices and logistical challenges as two of the major challenges that could affect Barbados in the medium term as a result of the conflict.
Prime Minister Mia Mottley, during a press conference on Saturday, acknowledged that the war between Russia and Ukraine could have implications for the cost of fuel and food, disruptions in the supply chain globally and the supply of some food items.
However, she gave the assurance that Government was already putting things in place to cushion the likely shocks, as she noted that Barbados had adequate foreign reserves of over $3 billion to adequately manage any price increases.
In addition to a ban on the Russian Central Bank, several countries including the US, UK, the European Union and Canada, have issued a range of economic and financial sanctions against Russian banks.
There have also been a number of asset freezes and new business restrictions against several Russian banks. Several countries have also frozen assets belonging to a number of high-profile political officials and other oligarchs, while some countries have banned transportation from Russia.
Cummins explained that while Barbados’ service providers did not get a lot of business in the business sector from Russia, “every institution in BIBA, every bank and trust in Barbados have to look at the list of sanctions”.
“Look at the banks that are on the sanctions lists, look at the individuals that are on the sanctions lists and make sure and secure they are not in their books in any way, they are not doing business with them, they are not transacting with them. If there are any accounts in their banks, they need to figure out how to treat with them,” he said.
“The next thing is the term. Sanctions aren’t turned on and turned off. What is an exit strategy? Even if Russia pulls back, sanctions aren’t off immediately, so we are in this for a long haul, I think.”
Cummins was responding to a question during an online ceremony on Monday to launch plans for BIBA’s 25th-anniversary celebrations this year. The silver jubilee will focus on the various industries in the sector as the association hosts several events to mark the milestone.
On March 21 and 22, BIBA will host its Barbados Risk and Insurance Management Conference, focusing on new technology in the insurance industry. In April the spotlight will be on the future of financial services and opportunities for Barbados, again with a focus on the use of technology.
In May, BIBA will host a global leaders’ forum, and in June the attention will shift to the professional service’s members. (MM)
