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EDITORIAL: Govt must work to restore confidence

Barbados Nation

EDITORIAL: Govt must work to restore confidence

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The quick denial of Minister of Finance Chris Sinckler that this countryis contemplating an IMF programme is important newsfor an economy which has suffered from six years of problems which however they were caused have preventedthe government from delivering on some of its policies.

The Minister’s denialcame after the Canadian newspaper the Toronto Globe& Mail reported that Barbados which it described asa traditional powerhousein this region was in dangerof being unable to financeits economy.

In elaborating on the denial the minister pointed outthat the economy was showing signs of a turnaround, although he was quick to add that theturn around was not to hisentire satisfaction.

Not surprisingly, the evidence of this turnaround is to befound in the tourism industry and increased numbersof visitors and higher spending by them proves the pointthat tourism industryis not only our business,but that it is good for our economy to ensure thatthe industry thrives,and that local attitudessupport the development of our tourism product. This industry should have the supportof all Barbadians.

We mention local attitudes because the erection ofbuildings and new plantmay be important indicatorsof improvement. Butit is the impact on individual pockets of ordinary citizensthat matter, and this is a point acknowledged by the minister himself. Tourism therefore matters to people ina personal way.

The minister reinforces this point by reminding us that the government’s major challenge  was to “ensure that the improvement continues and that it reaches down to ordinary person so that we get more jobs and the economy keeps goingso that government’s revenues can improve over the next year and ease some of the cashflow challenges”.

What the Minister did not spell out on this occasion was that adequate foreign exchange reserves insulate the economyin an important way fromhaving to go cap in hand,as it were, to the IMF.

We believe that the improvement in tourismis very welcome development since it brings in revenueand at the same time increases foreign exchange.

In these circumstances the government’s initiatives designed to promote not only tourism but equally the international financial sector and thecultural industries should be supported by the public, since success in these areas willassist in fuelling growthin the economy bringing jobsand general improvement.

The hard fact is that investment will not be made unless investors have confidence in the improving health of our economy, and hence the potentially damaging impactof the Globe & Mail

story published in a country,from which we draw the lions share of our international financial investments.

We trust that the Minister’s immediate retort will repair any damage which may have been done to the image of our economy; because while our economy is not yet out of the woods, there seems to be some light at the end of what has been a challenging tunnel.

The Government must therefore continue its effortsto improve the economyand to restore investor confidence as a precursor to the return of growth to our small open and challenged economy.