These aren’t heady days for Barbados and its economy. Saddled with a huge pile of debt, a widening public deficit and increasing business failures, not to mention high unemployment, the Caribbean country is casting about for answers to end the recession into which the economy has fallen for the second time since 2008.
Barbados seems to be on the road to the International Monetary Fund’s door once again.
But two of Barbados’ most outspoken public figures, Rev. Dr Marcus Lashley, a psychologist and Anglican priest who teaches at the University of the West Indies and Codrington College, and Donville Inniss, Minister of Industry, have at the very least offered a partial way out of the financial mess.
Lashley thinks the cabinet is too large and it should either be reduced or the ministers, Inniss among them, should take a symbolic salary cut.
The minister, on the other hand, argues a cut in Government spending is a necessity and indeed inevitable but it should come at the expense of the public service.
“I’ve always said, personally, that I felt the public service in Barbados has been too large and too unwieldy for way too long,” he told a meeting of ministers responsible for international business and financial services in CARIFORUM.
“One way or another I expect that the public services in terms of size and scope in Barbados will have to reduced,” he added. “It should have been done maybe ten years ago.”
What a pity the minister didn’t emphasize that point during the February Election campaign when issues of Government size and privatization were being hotly debated on opposing political platforms and the ruling Democratic Labour Party was behaving as if the country’s finances and the economy were in good, if not excellent shape.
As discussed during the campaign, privatization was about expanding the role of the private sector and reducing the presence of government in the provision of services. Clearly, it certainly wasn’t the demon it was made out to be earlier this year by several Cabinet ministers and it isn’t an evil now.
Interestingly, Lashley and Inniss seem to agree on the essential role of the private sector and entrepreneurship in Barbados.
“It is common to see a growing number of mobile food vans, week-end barbecue grills every few hundred yards, and young men on the highway selling fruit, all struggling to make ends meet, and to make a dollar,” said Lashley in Brooklyn on a recent Sunday afternoon at Barbados’ official Independence Service.
“New entrepreneurs are entering the film industry and with the deck stacked against them, new vendors and opening up shops in our malls.”
At the Radisson Aquatica Beach Resort just outside of Bridgetown, the minister was quoted as saying the civil service could be reduced gradually by expanding the private sector and paying more attention to entrepreneurs, entrepreneurship and innovation. The Government, he argued, should “pull out” of “certain areas” and provide necessary goods and services like education and health care while facilitating the private sector’s growth in other areas.
That’s precisely what privatization is about.
It may have been coincidental but when Inniss spoke about “entrepreneurs” and “innovation” in the same breath, he was echoing the sentiments of the World Bank when it came to encouraging economic growth and revitalization in the Caribbean and Latin America.
Augusto de la Torre, the international financial institution’s chief economist for the Caribbean and Latin America, said in a report that a “massive 60 per cent of regional employees work for businesses with five or fewer employees.”
As he explained it, firms across the region tend to start and stay small, supporting the view that large size doesn’t always matter.
“There’s nothing bad about being small, per se, but staying small forever is a problem,” he warned, being quick to suggest that a contributor to “stunted growth” was a chronic shortage of innovation within the region.
De la Torre and the report articulated the case for the building of an “innovative entrepreneurial class” in which top-notch export firms no longer look “tepid” when they compete against superstar corporations.
“This lack of innovation harms competitively and slows growth and rebounds on quality job creation,” the Bank warned.
The truth is that unlike some Caribbean and Latin American countries, Barbados didn’t move fast enough to encourage more of its young people to be entrepreneurs. It’s not too late.
At the same time, it must end the unproductive and wasteful policy of using tax-payer financed state enterprises as employment agencies for ministers. Both major parties and successive governments have done it and it’s time to end it. Privatization, the hated word in February, may become part of the favoured language of choice of the Government.
• Tony Best is a veteran journalist and NATION New York corespondent.