AHEAD?OF?A Press conference today for business journalists by the Governor of the Central?Bank,?Opposition spokesman on the economy?Clyde Mascoll, is calling on Dr DeLisle Worrell to address several issues.
Chief among them, Mascoll said yesterday, would be the failure of the net international reserves to grow in spite of the sale of the NIS shares to the Canadian company Emera.
Second, he said, was the means by which the CLICO debacle would be financed; third, the continuing worsening of Government’s fiscal position in the face of recent increases in taxation; and fourth, Government’s capacity to finance its fiscal deficit for this year from purely domestic sources.
“It was clear that the purpose for the sale of the NIS shares to Emera was to boost the country’s foreign reserves. Why have we not seen the desired boost?” Mascoll asked.
“Why did the commercial bank or banks not sell the Central Bank of Barbados any of the foreign currency from the sale of the shares?
“In the circumstances, is the Central?Bank still proposing to allow a Barbadian to hold up to the equivalent of BDS$250 000 in a foreign currency account?
“What has happened to justify increasing this limit from $20 000 to a whopping $250 000? What are the pros and cons of such a policy at this time?”
The economist noted that Worrell had indicated even before the Minister of Finance did that it was Government’s intention to ensure that CLICO policyholders received all their money, and wondered whether this was still possible.
“If so, how do you propose to advise Government with respect to raising the money to cover the cost of the CLICO affair?” Mascoll asked. “By the way, what is the cost of settling the CLICO affair? Does this cost include any obligation to policyholders in the Organization of Eastern Caribbean States?”
Noting that Worrell has written extensively on the need for fiscal prudence in Caribbean economies, Mascoll queried whether that need had changed in recent years and whether the governor still saw a connection between
the financing of fiscal deficits and the country’s foreign reserves?
He asked of the governor:?“Are you still factoring private capital inflows of US$250 million into your foreign reserves projection for the year?
“In light of the five increases in the local lending limit over the last three years, do you have concerns about the domestic market’s ability to deliver all of the finance required to finance the fiscal deficit in this new fiscal year?
“In the circumstances, do you not see the need for the Government to borrow from the international market within the next 12 months? If so, is the country’s credit rating going to be a concern if the fiscal crisis is not properly addressed?
“Finally, is it still better to go to a fortune- teller to know the economy will perform this year?” (AB)
