Credit unions could pull Barbados through crisis

BRIDGETOWN, Barbados, October 30, 2008 – In the midst of the global economic turmoil, the credit union movement in Barbados has been told that it may hold the key to weathering the economic crisis as the island braces for the negative fallout from the credit crunch in some overseas markets.

Prime Minister David Thompson said that credit unions must consolidate their position to dominate the local market and penetrate regional and global markets, although he acknowledged that considerable work must be done to prepare credit unions for the task ahead. According to him, this includes the need for modernising legislation to better protect shareholders’ interests; improving corporate governance; strengthening the supervision and regulation of the sector to stave off dangers like money laundering and embezzlement and improving service.

His call came as he also warned Barbadians to brace themselves for uncertain economic times ahead.

Meantime, Mr Thompson urged the movement to grab the opportunities that will become available under the Caribbean Community (CARICOM) Single Market and Economy (CSME) and the recently concluded Economic Partnership Agreement (EPA) with Europe.

He said that while the EPA was not the best outcome for CARICOM, the agreement would place the movement in an excellent position to launch products and services on a global scale.

“I want you to remember that Barbados and other CARICOM member states have a large Diaspora in Europe and North America. The EPA certainly gives credit unions, based in the Caribbean, access to this not insignificant number of potential members, many of whom, in normal circumstances, are better off and highly committed to the economic development in the region,” he said during the recent City of Bridgetown Co-operative Credit Union’s 25th Anniversary Dinner and Awards ceremony.

That credit union has over BDS$275 million (US$137.5 million) and 40,000 members. The entire movement in Barbados is made up of 37 credit unions with total assets of over BDS$1 billion (US$500 million) and a membership of more than 147,000.