The need for more fiscal measures will not vanish after next week’s General Election, says Barbados Economic Society (BES) president Shane Lowe.
Speaking yesterday at a national economic debate hosted by the BES and the Chartered Financial Analysts Society of Barbados at the Lloyd Erskine Sandiford Centre, Lowe said: “Given the need to boost capital works to enhance physical infrastructure and few sources of financing, a new administration will need to cut current expenditure and/or raise tax revenues more than the existing fiscal gap to sustainably balance the budget and provide enough room to finance necessary infrastructure upgrades.”
The bad news, he added, was that “more austerity could further slow growth of the Barbadian economy unless private sector investment rebounds”.
“Thus, improved conditions for doing business and the courage to facilitate innovation in new and exciting economic sectors are necessary to enable economic recovery,” he said.
Lowe also said that “without substantial growth in financial inflows, planned debt service payments will likely further reduce the stock of foreign exchange reserves”.
Participating in the debate, United Progressive Party spokesman Bruce Hennis said his party’s strategy for the economy would focus on the export of creative services.
“The net effect is to become an export-led, highly innovative, high growth economy where we are earning foreign exchange and having a high level of growth within the economy itself,” he said.
Solutions Barbados leader Grenville Phillips II said his party, if elected, would address structural issues affecting the economy.
“We have costed our proposals, [and we] would run a surplus without laying off a single civil servant, without reducing any salaries and while we eliminate [value added tax] . . . . There would be no austerity,” he said. (SC)
