MINISTER OF FINANCE Chris Sinckler will have a lot of explaining to do when he speaks today on the economy and the recent Central Bank debacle.
With Dr DeLisle Worrell’s eventual dismissal from the post of Governor, the big question is who will be appointed permanently to lead the bank and repair the damage to its credibility. The other challenge is to make changes to enhance
the institution’s governance.
But there are other issues which must hold Mr Sinckler’s attention and which, based on the barrage of public comments, are of grave concern to the country and beyond.
We speak of the fiscal cliff the country faces, given its unacceptably high level of debt. The minister would be unwise to dismiss all the comments and viewpoints which speak to the severity of this problem as being merely politically motivated, or coming from people who are naive about public financing.
Beyond the voices that unanimously recommend that swift action be taken to arrest the country’s economic slide, the startling facts of the worrisome situation are gradually unfolding.
The indebtedness of the Caribbean Broadcasting Corporation (CBC) to the tune of $115 million, as highlighted in yesterday’s SUNDAY SUN, is alarming. Just imagine what this figure would jump to if the debts of the National Housing Corporation, the Transport Board, Sanitation Services Authority and others were disclosed.
It is these heavily indebted state-owned enterprises which are at the centre of the country’s economic troubles. The sad thing is that in many instances, the accuracy of the financial reporting of parastatals comes into question since several do not publish up-to-date statements of accounts. It is evident that the debt-fuelled binge incurred over the years now needs to be exposed.
There is little sense in seeking public sympathy or expecting forgiveness from creditors, many of whom, especially small enterprises, are under pressure awaiting payments. The logical question is whether CBC and other state-run businesses will find themselves in court, as commercial banks and other creditors seek to recoup overdue loan and other payments.
The situation is pretty dire, even to the casual onlooker. Many of these statutory corporations have little or no cash and must look to central Government, even if only for a letter of comfort, as they try to face up to their indebtedness. This cloudy situation must make Barbadians nervous.
The entire economic system is made vulnerable as a result of what is happening with these money-draining entities. In the midst of this quagmire, the unions are still demanding hikes in wages and job security.
Mr Sinckler must be open and forthright with the nation. Too much is at stake.
