Thompson: ‘Aggressive’ measures to shore up Barbados economy

BRIDGETOWN, Barbados, October 30, 2008 – Barbados’ Prime Minister has announced sweeping policy measures proposed to stop his country’s slow slide into recession as a result of the global economic downturn.


As he opened his country’s annual public-private sector economic consultation at the Lloyd Erskine Sandiford Centre on Wednesday, David Thompson revealed the bones of a plan by his administration to take decisive action to mitigate the “secondary economic and financial fallouts” already being felt by some sectors of Barbados’ economy.


Thompson announced to the gathering of civil servants, private sector leaders and their subordinates, and trade union members, a seven-part economic stimulus package aimed at “aggressively” protecting existing jobs, creating new ones, protecting the poor and vulnerable in the society, and shoring up the all-important tourism industry.


“The following policy initiatives are being proposed, without prejudice to our discussions today,” said Thompson in the morning. “One – to seek to jump start and encourage increased economic activity in light of a possible recession, primarily through counter-cyclical policy measures. In this regard, government will seek to bring forward its capital projects to stimulate economic growth and productive capital in consonant with those capital projects that do not.


“Secondly, continually ensuring that wages policy guidelines are administered in line with fiscal and monetary policy objectives with a view to protecting and creating jobs to maintain broad-based macro-economic and financial sector stability and social sector stability and people-centred development.


“Three – to enhance support where the necessary to sensitive sectors such as tourism, international business, manufacturing, agriculture and micro small and medium-sized business entrepreneurs.


“To increase South-South cooperation by targeting those none-traditional markets four our tourism and manufacturing products. We can’t continue to depend primarily on two economies – namely the United States and the United Kingdom.


“Five – to continue efforts as promised in our Manifesto and Throne Speech to reduce the general cost of living as the means to ensure macro-economic stability and to enhance the spending power of all Barbadians, especially the poor and the vulnerable.


“Six – to continue to ensure that the average Barbadian is able to have access, and more importantly, to afford quality housing and land.


“Seven – to continually seek to boost our foreign exchange reserves and protect our exchange rate parity.” Thompson called on the assembled private sector and labour leaders to support these initiatives are government sought to “buttress” the economy.


At the close of the session in the afternoon, Thompson also heeded the day’s calls by a leading figure in Barbados’ threatened offshore sector – attorney-at-law Dr. Trevor Carmichael – to come up with a “war plan” for the country in these difficult times. Thompson said he had tasked a working group led by former Central Bank of Barbados Governor Dr. Winston Cox, to come up with such a plan based on yesterday’s proceedings.


Thompson said the working group was to meet between November 17 and 21 in order to devise a report that could be submitted to the next meeting of the Social Partnership (the tri-partite national consultative body made up of representatives from government, labour, and the private sector) on November 28.


The other members of the working group are Ben Arrindell, chairman of the Barbados Private Sector Association and managing partner with Ernst & Young; Peter Boos, former chairman of Invest Barbados and of Ernst & Young; Director of Finance in the Ministry of Finance, Grantley Smith; Dr. DeLisle Worrell, executive director of the Caribbean Centre for Money and Finance and former deputy governor of the Barbados central bank; Kelvin Dalrymple, chief research economist at the Caribbean Development Bank; Dr. Justin Robinson, lecturer in banking and finance at the University of the West Indies, Cave Hill; and a representative from the Central Bank of Barbados.