Disclaimer: The views and opinions expressed by the author(s) do not represent the official position of Barbados TODAY.
The Small Business Association of Barbados (SBA) is pleased to once again have the opportunity through this newspaper, to highlight some of the issues affecting the small business community in Barbados and the region, and to engage our stakeholders in finding solutions to address these issues.
The commencement of this column – Business Basics – will assist in our mandate of advocacy, on the behalf of the small business sector, and education, to hopefully advance the development agenda needed to facilitate sustainable growth for small firms. We have said it now, to the point of ad nauseam, that small businesses represent the engine of growth for any economy – developed or emerging.
It is against this background that we looked forward with baited anticipation to the 2023 Budgetary Proposals & Financial Statements if only to hear of the revolutionary policies and programmatic agenda being considered at this time, to strengthen the sector and to position it for growth following the deleterious impact of the COVID-19 pandemic, global supply disruptions and the attendant high cost of doing business.
We were pleased to hear of the plans to review the structure of the Barbados Trust Fund Ltd., to consider a new model for the interest rate application, similar to that of the Student Revolving Loan Scheme. Kudos as well for the recognition that the film industry can be developed into a viable sector as part of our economic diversification strategy, away from our sole reliance on tourism. The $2M investment is only a start in our view.
The SBA has also commented in this newspaper on other issues relative to the high tax structure and its retardation of business growth, the need for a regulatory environment to monetise digital transformation and the untapped market of the credit union sector to assist with the capitalisation of MSMEs.
One glaring omission from the recent Budget presentation, however, was a lack of focus on the regional project of the CARICOM Single Market & Economy and how this “free trade area” can be further developed to provide an expanded market for the goods and services of our small entrepreneurs. If truth be told, very little seems to be said of late about this regional project. A situation that is further compounded by the fact that Barbados has lead responsibility for the CSME within the CARICOM quasi-cabinet. Whither the CSME?
Economists and students of trade policy will quickly remind us that the Organisation of Eastern Caribbean States is the only region where Barbados enjoys a trade surplus. For decades our goods and services producers have been able to find a market in this region and expand to the point where data showed exports from Barbados in 2021 of USD$57, 918 compared to imports from this sub-region to Barbados of USD$16, 948 for the same period (www.OECS.org).
The International Monetary Fund correctly notes that, being small countries, Caribbean states are unable to achieve effective economies of scale or “economic specialisation”. This suggests that some framework ought to be considered that allows for a rationalisation of industrial development in the region, with states using the model of competitive advantage advanced by Michael Porter, as an approach in their development programme.
This is needed if we believe there is any future benefit in the CSME. Should the ‘mission transformation by 2030’ agenda include a focus on the region? We say a resounding yes! The CSME, in its contemplation, provided an expanded market for MSMEs, from 280 thousand consumers in Barbados to approximately six million, not counting Haiti.
A review of the regulatory apparatus of the CSME would suggest that issues of contingent rights, competition policy and administrative arrangements for commercial establishment are still far behind the desired goals contemplated following the 2002 Revised Treaty of Chaguaramas which gave life to the CSME.
The CARICOM procurement system is another vehicle governments can use to assist MSMEs in preparing them to work together to compete for procurement opportunities at a regional level.
Every effort must therefore be given to how we get our MSMEs to start to work together across the region to expand their opportunities, and even more importantly, how we get regional governments to assist in this network development.
In the meantime, we are prepared to begin the robust debate on moving regional MSMEs forward and exploring what the CSME has to offer small businesses.
We invite our readers to join us in this debate!
