With a “Stalled-Economy” An Exposed DLP Now Plays For Public Sympathy – Fiscal Analysis from Henderson Bovell

It seems some Barbadians cannot understand what Abraham Lincoln once warned: ‘You can fool some of the people all of the time, and all of the people some of the time, but you can not fool all of the people all of the time.’

In a totally unrelated issue; on the heels of the Central Bank Governor telling the country that Barbados does not have a debt problem, I immediately wrote a research article in which I stated : “The bottom-line is: Barbados is suffering from crippling inflation – brought on in large part by internal shocks. Government’s indebtedness, including to the Central Bank and the NIS funds – is also cause for great concern.”

I expressed serious concern that: “Incidentally the debt was alleged by the DLP to have been a problem and too high when the BLP was in office. Apparently not so, under DLP rule - even though, Barbados is far more indebted today and with a serious fiscal crisis.”

It also occurred to me that something was just not making sense so I stated: “In the circumstance, talk about the Barbados economy doing better than that of Trinidad iselection-speak,” a trick; an elaborate gimmick to trick Barbadians into believing that the DLP knows what it is doing and that the economy is getting better, which is clearly not true. It is also a gimmick (though ill-advised) to trick rating agencies, who are already aware, that the DLP made a bad situation, much worst.”

Now, BRAmmmm!!! In the Weekend Nation of June 1, 2012, under the bold caption: “Rising Debt a concern for S&P” there is a shocker – a news article, which read: “A day after Central Bank Governor Dr Delisle Worrell offered some positive reassurance about the performance of the Barbados economy, the international rating agency Standard & Poor’s (S&P) has sounded the warning that it is not yet out of the woods.

Olga Kalinina, a top S&P analyst, who was recently in Barbados meeting with Government officials and other key economic players, told the WEEKEND NATION in an exclusive interview how the island’s rising debt profile remained a source of concern.

It was on February 13, 2012, when the same Nation Newspaper carried an article, under the caption: “Red Zone” in which Deputy Central Bank of Barbados Governor Harold Codrington – was reported to have said that ‘BARBADOS IS ON THE VERGE of another financial downgrade.’

{FILE IMAGE VIA - ABC NEWS} The S&P expert also cautioned there was a “rising probability” that Barbados’ credit rating could be downgraded to junk bond status over the next 12 months.”

The article added: ‘And Deputy Central Bank of Barbados Governor Harold Codrington says to avoid it the island must keep trimming its fiscal deficit.’ It continued: ‘Codrington spoke against the backdrop of international credit rating agency Moody’s Investors Service lowering its domestic currency rating on Barbados last June to the brink of junk, citing concerns about the nation’s ability to absorb high levels of government debt issuance as the already large deficit was expected to rise.’

Given all of the above, the sensible questions must be: (a) what did the Government do since February 2012 to bring down the debt (b) did the debt increased since or (c) did Barbados become more exposed and (d) does all of this drama explain why the DLP spent so much time and energy, during the “VAT (amendment) Bill” – trying to paint a favourable picture that the deficit was reduced?

This is a DLP-Government that promised that it will not hide any secrets from the people. Barbadians are therefore extremely concerned that the DLP might not be telling them all that there is to know. Not only has the DLP exposed the economy but now Barbadians.

Unfortunately, instead of protecting Barbadians, the Government seems to be looking for sympathy and obsessed with manufacturing the impression that a down-grade by rating agencies (which it tries to describe as: “jittery and under pressure”) – would be unjustified and unfair.

But, if the economy is “stable” (as the DLP alleges) then you can hardly fault independent thinkers for holding the view that the economy is neither getting better nor worst. That would also be confirmation that DLP policies are not working and will explain why the economy remains ‘STALLED” for 18 months or six consecutive quarters, now.

Even under such conditions, it would be unjustified for the debt to increase. The economy does not seem to be “stable”, rather – “almost comatose or seems on life support.” Such a fiasco would explain why rating agencies are taking copious notes. Whatever the truth is, the DLP must be given a failing grade for its dangerous mismanagement of the Barbados economy and for then failing to prepare the country for the devastating consequences.

The Country deserves Better!

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