A UWI economist is forecasting that Prime Minister Mia Mottley will provide some relief for consumers from the high cost of living when she delivers her 2024 Budgetary Proposals in Parliament on Monday.
But the spokeswoman for the nation’s small business community has declared that instead of new proposals, it wants to see existing long-promised initiatives properly implemented, such as the junior stock exchange, collateral registry, and revisions to online and small business taxes from previous budgets.
Professor Justin Robinson, Pro Vice-Chancellor and Principal at the University of the West Indies Five Islands Campus, also predicts that businesses would be offered initiatives to boost growth in the economy.
“What I anticipate is that the government would be trying to be innovative…will try to find ways to generate the fiscal space that it can do at least two things,” he told Barbados TODAY.
One of those things, he suggested, would be “some ease around the cost of living that persons have been complaining about, also provide initiatives for businesses and sectors of the economy, all aimed at driving growth”.
“And thirdly, have enough capacity for the government to undertake capital expenditure, all aiming to drive growth. But at the same time, you have to be innovative to do this, and remain on a target to that debt to GDP ratio of 60 per cent by 2035.”
In contrast, the Small Business Association of Barbados (SBA) said there was no need to recommend any new proposals in the Budget.
Chief Executive Officer Dr Lynette Holder suggested the association merely wants the government to implement its promised proposals for small businesses dating back even before the Mottley administration took office in 2018
She said her key “wish is for government to work”.
“We don’t have a list of wishes per se or introducing any new concepts, any new programmes,” Dr Holder told Barbados TODAY. “We want to see the existing ones that have been articulated before properly operationalised. That is our issue. There are so many initiatives that have been mentioned for the small business sector that are just not working, and we want to see them working.”
Dr Holder recalled that Mottley had introduced a junior stock exchange in her 2019 budget, but complained that five years later, the initiative “is prodding along slowly, and, in my view, too slowly”.
The SBA leader said: “The Collateral Registry again was one of those initiatives that was mentioned that would help slow firms who wanted to access funds but who don’t have collateral. You can use what is known as your moving assets, you can use equipment, you can use your stock. Where is the Collateral Registry today?”
Dr Holder said she is also waiting for a revision of the two per cent online transactions tax which she contended should be removed for businesses trading online but could remain for consumers.
She added that the five and a half per cent tax on small businesses is one measure she expects to be ended in the Budget.
Professor Robinson predicted that businesses should be in line for some relief in the Budget.
“Also, there are some aspects of the social services sector where government may wish to intervene and provide some additional funding for. The healthcare system seems to be under tremendous strain in Barbados. The physical infrastructure in terms of roads and sick buildings, reform of the educational sector.
“These,” he forecast, “are some of the eases and areas that the government will be looking for fiscal space in an attempt to address those areas, in terms of driving growth in the economy as the government’s capital works programme gets ready to peak.”
The professor advised that all of that has the capacity to assist in terms of growth.
“But all of that must be done within the context of staying on that target. I am not aware of how much fiscal space they have, but the government is going to have to be quite innovative to marry those objectives,” he said.
Professor Robinson said he is curious to see what are the policy initiatives and actions around the renewable energy sector that have been earmarked as a major area for growth.
He noted that while various individuals, organisations and the private sector have invested heavily in this sector, some investments have been stalled due to the unreliability of grid capacity and battery storage issues.
“I am looking forward to seeing what initiatives and actions are going to come out of that area. But I expect it to be a delicate dance of the government, trying to find the fiscal space to address social issues and to provide initiatives and action, and drive economic growth along with a continued capital expansion programme.”
emmanueljoseph@barbadostoday.bb
