Saturday, April 13, 2024

WILD COOT: Who ask you?!


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Nobody asked me, but I gave the advice freely in February 2009, fully 25 months ago.
“There is need now to examine the portfolios of CLICO Holdings (Barbados) Ltd and its subsidiaries and, if necessary, liquidate assets if the asset mix shows a preponderance of investments and illiquid assets (one of the problems of the group).
“This is most necessary in view of the hardening of our real estate market and the reduction in returns on mutual funds, bearing in mind the high interest rates offered by CLICO. Plans for future programmes, although they may involve construction and jobs, also involve foreign exchange. Do we have it for these and other projects about which we glibly talk?”
I salute Mr William Layne for his outspoken and principled stance. I wish more people were prepared to stand up and be counted instead of uttering extemporaneous verbal evaporations and expatiations.
He was the head of an Oversight Committee to look into CLICO’s dealings and to make recommendations as to the way forward. Now he is concerned that after recommending judicial management, the powers that be are still at the traffic lights although they are green.
If judicial management should be the next stop, foolishness like former employees demanding millions in salaries would be a no-no. They would have to wait in line like all other creditors (and policyholders) to see if their claim is legitimate and to get X cents in the dollar, if any money is eventually left.
I have said, and I say it again, those who invested in CLICO should be prepared to accept the consequences of a failed investment (harsh but fair), and not to expect the wider population of Barbados, who did not invest, to bail them out. Let the chips fall where they fall.
The CLICO affair is a problem of the greatest magnitude, and part of the problem may be the close and intimate friendship of the key players shamelessly flaunted by the Government past and present. Could this in fact tarnish the image of Barbados?
The failure to act now that permeates the Government from top to bottom makes a mockery of our claim to capable post-colonial management from our elect. Is there no one who will “bell the cat”?
The truth of the matter is that CLICO’s assets, if examined closely, may be little as compared to their projected liabilities, and the fear is that with a judicial management, when cost is deducted, very little if any will be left to the creditors (policyholders), especially when we include the Eastern Caribbean.
What is more, the fear is that somebody or somebodies, like Madoff and Stanford et al., will spend time on remand or in jail where it is rumoured that unusual habits prevail. But who knows, it might be a likeable experience.
Efforts to calm Barbadians at the outbreak of the debacle by the then Prime Minister and Supervisor of Insurance were commendable, but the follow-up action left much to be desired. One must question why the logical step has not followed.
Was it a case of friendship? Is that still the case? If it is, God help us! For Barbados it may mean that the threat of being labelled a banana republic is becoming real.
I say, let judicial management proceed. Let the courts decide who is to be blamed, if anybody; be it director, employee or policyholder, and let the public feel comfortable about the Government’s role, past or present.
I had the opportunity to invest in the company but preferred not to do so as the interest return was “too good”. There are many people of all walks of life who took the same course as I did. Why should they pay value added tax at 17.5 per cent, National Insurance, motor and land taxes at an exorbitant rate in order to bail out those who invested, attracted by high returns.
CLICO is not the only problem that faces us. Like other countries, we have to see where the oil prices and its cousin the food prices are carrying us. Now that countries are examining their nuclear plants, more pressure will be put on oil supplies, hence higher prices.
Were we to absorb another $500 million or more and add it on to our budget deficit, people will say that we are playing Monopoly.
While I sympathize with the Government’s dilemma, I am concerned that playing politics can be detrimental to the well-being of the wider society. That is why sometimes great men capable of making bold decisions exist.
But who ask me?


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