The foreign exchange reserves cover was lower than its present state under the former administration, says economist Sir Frank Alleyne, but the then Opposition Democratic Labour Party (DLP) never made the issue into a public furore.
Sir Frank, who addressed a St Michael North West branch meeting at the old St Stephen’s Primary School last Sunday night, said the standard cover for a country was 14 to 15 weeks of foreign exchange reserves, but to date it stood at 16.
“In 2003 the number of weeks of foreign exchange reserve cover was 15, in 2005 it was 15 weeks, in 2006 it was 16, in 2008 it was 16.4, in 2009 it was 20, in 2012 it was 19.5, and at March 31 this year it was 16.
“In 2003, did the DLP Opposition walk about this country saying there was a foreign exchange crisis when it was 15 weeks? They didn’t do it in 2005 either because the DLP was not interested in dragging down the country. You don’t burn down a house then to rebuild it,” he told the audience.
Referring to those raising concerns about a foreign exchange crisis in the country as “political nuisances and humbugs”, he reminded that at no time between 2006 and March 31 this year did the foreign exchange reserves fall below 16 weeks.
Describing solid foreign exchange cover as the key to successful management of an economy, he said “this Government managed the economy well”.
In reference to the recent International Monetary Fund (IMF) forecast of negative 0.8 and 1.1 per cent growth in the next two years, Sir Frank referred Barbadians to a 2009 study by the Inter-American Development Bank titled Measuring The Competitiveness Of Selected CARICOM Countries, which noted that each country was in a different state of development.
“Guyana, Suriname and Trinidad and Tobago are in status 1, 2 and 3 respectively. It means Guyana is in a low state and Trinidad in a higher state; while Jamaica and Barbados are in transition from states 1 to 2, and from 2 to 3 respectively. Jamaica is in a more primitive state, so to speak, a lower level of development than Barbados,” he stated.
“Hence, despite the geographic proximity, the factors driving their competitiveness are quite different in specific economies. You have to compare like with like, not apples with oranges. Because you’re in CARICOM it doesn’t mean you’re in the same boat,” he explained.
The veteran economist also commended the work of Central Bank Governor Dr DeLisle Worrell, a former IMF official.
“I have known all the governors of the Central Bank. All of them are outstanding managers but I do not know any Central Bank manager in Barbados who technically is stronger than DeLisle Worrell,” he said. (RJ)
