Marshall slams economic direction

Prominent economist Professor Don Marshall has issued a sharp rebuke of the country’s economic direction, charging that successive IMF-backed reforms have prioritised fiscal performance over true economic transformation.

He contends that while authorities celebrate macroeconomic stability, the deeper structural questions about how Barbados generates wealth and jobs remain unanswered.

“We are not building an economy — we are managing debt to please financial elites,” Marshall charged, adding, “All look to the Office of the Prime Minister for relief, gifts of grace, contracts, favours and succour.”

Drawing parallels, Marshall highlighted Burkina Faso’s rejection of IMF and World Bank financial support, praising its pursuit of industrialisation and resource control. 

“The Burkina Faso Government has also rejected financial assistance from the IMF and World Bank, insisting that the country can develop without their loans and conditionalities. Recent polls show most ordinary Burkinabé support the Ibraham Traore regime based on the start-up initiatives to industrialise, and efforts to control the country’s resources through different bargains with creditor nations and investors.”

He referenced a projection from the Institute for Security Studies Africans’ Futures and Innovation team, which estimates that “on its current trajectory, Burkina Faso’s could grow at an average of 8 per cent from 2025 to 2043.”

Marshall’s comments follow the Central Bank of Barbados’ most recent review, which reported 2.6 per cent GDP growth for the first quarter of 2025, driven largely by tourism, business services and construction. 

The report shared that reserves climbed to $3.4 billion, and the debt-to-GDP ratio continued to fall — metrics hailed by officials as evidence of a successful economic path.

But Marshall dismissed the glory narrative surrounding the country’s fiscal progress, arguing that stabilising public finances does not equate to building a resilient, diversified economy. 

“Fixing your public finances is one thing, transforming your economy however demands moving beyond the limited diversification that constrains the growth of quality jobs and foreign exchange earnings,” he said.

“Yet no plan with timelines, performance targets and evaluation reports underpin the many announced initiatives — from Barbados being in the metaverse, establishing various overseas missions, having the Afriexim Bank headquartered here, constructing a food science park, launching an agricultural initiative at Lears with the Republic of Guyana [and so on].”

“We have had several addresses about the economy on the floor of Parliament and from periodic reviews by the Governor of the Central Bank. How all these initiatives cohere, the costs, challenges and opportunities — none of this is discussed. We are instead treated to shibboleths and assertions about the management of the debt to GDP, tourist arrivals and efforts to meet compliance demands in the international business sector.”

Describing the ongoing conversation as a “mock debate,” Marshall questioned whether the debt incurred since the 2018 restructuring has led to meaningful investment in new, productive sectors.

“The local debt component has been significantly reduced, largely to do with the debt restructuring of 2018 onwards. But external debt has increased and while that’s necessary to support infrastructure renewal, what effect has this debt had on building out new productive sectors? What has been the character and orientation of the inward investment to Barbados over the last 15 years? Are there any investments in value-added, or refining processes, in film, theatre, biotechnology or renewables? Has such been incentivised?”

The economist also raised questions about whether IMF conditionalities under the BERT programme allow enough policy space for the government to pursue industrial policy. 

“Do we have an industrial policy? Do we have the policy space to have one under BERT? Can you produce fiscal surpluses, borrow from the IMF and Paris Club of creditors, and stimulate growth in new productive sectors all at once?”

“If you start off with a development plan girded by a vision to broaden the base of the economy along value-added lines, then it is possible to have discussion about state posture, inter-ministerial coordination and the role of investors and social partners. Not ’bout here,” Marshall charged. 

shannamoore@barbadostoday.bb