BASSETERRE, St. Kitts, June 12. 2018 – NEWLY elected Prime Minister of Barbados, Mia Mottley says that authorities are currently in the process of drafting a new plan to address the current vulnerabilities for the country.
While delivering her first budget address as Prime Minister, Motley said she is discouraged by what was published in a recent report by the International Monetary Fund (IMF).
Led by Bert van Selm, an IMF team visited Bridgetown between June 5-7, to hold talks on economic policies and possible IMF financial support for the government’s economic plan.
At the end of those discussions, the IMF reported bleak data, stating: “Barbados is in a precarious economic situation. International reserves have dwindled to US$220 million, while central government debt is unsustainable. The fiscal deficit has decreased over the last few years but remains large, at about 4 percent of GDP in FY2017/18. Meanwhile, the Central Bank of Barbados (CBB) is reporting a contraction of output of 0.7 percent in the first quarter of 2018 (over the same period last year).”
But Motley told Parliament today that a change of government was needed, and that, in itself, will not be enough to return the country from the precipice.
Irrespective of the outcome of the elections, the first female PM for Barbados stated that it was clear to the Barbadian electorate that urgent action was needed the morning after the polls.
“I pledged then, as I do now, that the first task of a new Barbados Labour Party Administration would be to halt the decline and decay of the last ten years, restore confidence and hope, and set clear guidelines and timelines for finding and applying solutions to our most critical challenges. I gave my word that a Barbados Labour Party Government under my leadership would respond courageously to the social and economic crises now facing the country, and that we would make the tough choices between what is essential, what is highly desirable and what is optional.”
The Barbados economy has been on a steady decline over the last several years, forcing the government of the day to make stringent policy decisions.
Prioritizing her party’s goals for the country, the prime minister stated that the immediate task of the Government is to confront, head on, the dire economic circumstances inherited.
Following consultations with the Social Partnership and the IMF, the PM laid a detailed assessment report before Parliament and the people of Barbados of what was found, the course of action agreed upon, and the budgetary measures required in the first phase of the Economic Recovery and Transformation Plan.
“Today, servicing the debt consumes more money than the entire central Government’s wage bill. It consumes more than our education and health budget combined. It is a tight chain strangling our throat and has for a while. It is one reason why the previous government stood idly by as our road sunk below sewage. Unsustainable debt traps you in an eternal descent, with no room to move, unable to grasp any opportunities to go forward and modernize…
“Unless we get our debt down to sustainable levels it will grow and consume more and more of our budget leaving no space for anything else, and I mean anything else. With each passing year we will lose more and more of those vital, cherished aspects like our education, health, our public beaches, and our peace and security. Indeed, the downward slide has already started. “
The Barbados Labour Party laid a $1. 2 billion “mini-budget” before the Parliament.
