Growth hinged on new revenue streams

Though optimistic that the Barbados economy could grow by as much as 1.75 per cent as predicted by the Central Bank, President of the Barbados Private Sector Association (BPSA) Edward Clarke says a number of things would have to take place this year for it to happen.

Presenting his economic review and outlook on the local economy yesterday, Central Bank Governor Cleviston Haynes said he was expecting growth of between 1.25 per cent and 1.75 per cent.

The economy declined by 0.1 per cent last year.

A cautiously optimistic Clarke told Barbados TODAY while he agreed the economy could see some growth this year, he believed a lot of that hinged on a number of significant projects getting started, improvement in the unemployment rate and the doing business climate.

The business official added that growth depended heavily on a strong tourism performance and “new revenue streams” coming into the economy from tourism-related projects, renewable energy, development of infrastructure from Government, development of the hotel infrastructure from the private sector, medical tourism, the digital side of business, the financial services sector and the international business sector.

“We need to get new activities coming in and we must improve the way we do business in Barbados. We must improve CAIPO’s (Corporate Affairs and Intellectual Property Office) performance. We must have things looked at differently,” said Clarke.

However, acknowledging that a lot of the tourism-related projects were “very big and significant investments”, he said the lengthy delay was somewhat expected due to the kind of due diligence required.

“I do not know where some of the projects are. Obviously we know some of them are being impacted by environmental studies or town hall meetings, and some of them are still in the planning office awaiting approval,” said Clarke.

“But we have been hearing about them for a while now and that is why people are getting anxious and worried. But I would say we need to be patient. I don’t think we should expect to see them starting all at once or right now. I think during the year you will see projects coming on stream, how many I do not know at this stage,” he said.

Clarke agreed that the private sector and civil society also had a role to play in helping to change the economic and social development prospects of the island, adding that the Social Partnership had already established committees for that reason.

Stating that the country was “nowhere where we need to be” when it comes to business facilitation, Clarke said: “We need to work on that together this year.”

While “hopeful” that Government’s targets under the International Monetary Fund (IMF) programme would be achieved, the business leader acknowledged that external shocks such as rising oil prices and health risks could have a slowing effect.

“But once the investment projects come on stream Barbados should be able to reach its targets. I have no concern about the expenditure controls. We need to ensure the growth in revenue comes about through new revenue streams and that is where we need to work together with Government,” he said.

While the unemployment rate was largely unchanged last year, finishing the period at 10.1 per cent, Clarke said it was still too high and he welcomed Governments First Job initiative, saying it was a good start.

This initiative is designed to provide young people with mentorship and apprenticeship opportunities so they can gain valuable work experience, making them more marketable.

“The concern is the significant level of unemployment among our youth, especially young males. We have to get people back to work and we have to find a way to make people interested in work also. We must ensure we can create opportunities for people, both the private sector and the public sector,” he said.

“The Government has had a lot of ideas on the table and we need now to put them to work. The First Job initiative is certainly something that we are working on with Government – the private sector, through the Social Partnership,” he added.
marlonmadden@barbadostoday.bb