Government Will Not Play Dead During The Economic Crisis

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Minister of Finance and Economic Affairs, Christopher Sinckler

Government does not intend to ???roll over and play dead’ during the current economic recession; but will continue to look for workable and tangible solutions to keep the island afloat.

Minister of Finance and Economic Affairs, Chris Sinckler, made this known today while addressing the Barbados Association of Insurance and Financial Advisors conference under the theme Yet Still I Rise, at the Lloyd Erskine Sandiford Centre.

"…That’s not the stance this government has, or will ever take, and it is certainly not the policy that I, as Minister of Finance and Economic Affairs, will ever adopt. Our position has always been to adopt a realistic approach to dealing with the crisis, identify what are our major challenges and fashion responses that address the problems…," Mr. Sinckler underlined.

He acknowledged that the last three and a half years had been a challenging one for the island as the recession continued to leave a trail of economic and social dislocation on citizens and some sectors.

Emphasising that the methods implemented were not designed to bring any undue economic and social hardship on the public, the Finance Minister said government, in collaboration with the business community and the labour unions, had crafted a five-year strategy to put the country on a sure footing.

These measures, Mr. Sinckler explained, included the stabilisation of the major macro-economic indicators to halt economic decline brought on by the financial crisis; to protect and grow the country’s foreign reserves by a judicious mix of earnings, investments and management of the international reserves; consolidating the fiscal accounts through revenue raising measures and expenditure cuts; restoring economic growth through strategic interventions; and maintaining a strong social safety net.

"As a government and a country, Barbados has not rolled over…we have been knocked to the ground a few times along the way, but we have risen, and will continue to rise even inspite of it [the economic recession]."

Despite the prevailing economic situation, the Finance Minister disclosed that the country had achieved some significant economic milestones.

Mr. Sinckler revealed that the country had risen from the depths of a four per cent decline in the gross domestic product in 2009 to 0.3 per cent positive growth in 2010 "with a potential 0.5 per cent growth output for last year.

The tourism sector, he added, recorded increased visitor arrivals in 2010 and 2011 respectively, rebounding from the potentially devastating fall off in arrivals in 2009.

Mr. Sinckler said the foreign reserves had been insulated from the impact of the economic crisis which allowed government to maintain levels totaling $1.4 billion or 18.5 weeks of coverage for imports.

Additionally, he noted that government had achieved a reduction in its deficit from nine per cent of GDP in 2009, to around 5.3 per cent in the last quarter, with projections of 5.4 per cent for the current fiscal year ending March 31.

"These figures put us in line with the original targets set out in the Medium Term Fiscal Strategy, and we achieved these targets while still boldly standing up to the ultimate of forging ahead with major structural reforms in our economy.

"We have established a clear strategy for alternative energy with an accompanying policy which, ultimately, would lead to the next major economic sector in Barbados.?? We have completed work in the overhaul of government’s procurement system; upgraded the VAT Division with the launch of an electronic filing system, called VETAS; launched the Central Revenue Authority which we hope to complete by March next year; reviewed government’s revenue system to identify and eliminate wastage and duplication; while, at the same time, initiating the much anticipated Barbados Competitiveness Project…," Mr. Sinckler surmised.

The Minister also pointed to the creation of the Financial Services Commission as being critical to stability and growth, of not only the non-banking sectors, but the entire financial sector.

julie.carrington@barbados.gov.bb

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