THE PENDING SALE of the Barbados National Terminal Company Limited (BNTCL) is of utmost importance for a variety of reasons.
Of particular note is that a Barbadian company can make the purchase for about US$100 million and in foreign currency. It is also hoped that the sale sets the stage for Government to move with urgency on divesting other state assets.
The process of clearly identifying which assets should be offloaded has been too slow and shrouded in mystery. The approach is symptomatic of the country’s lousy reputation in how it does business.
It is not a preoccupation of ours to oppose the state’s involvement in commercial ventures, but given the dire economic challenges the Government has been facing for many years, it seems inconceivable that it would want to retain control of loss-making enterprises simply because they provide employment.
The perilous state of finances at the Caribbean Broadcasting Corporation and the gross inefficiencies at the Transport Board, the Sanitation Services Authority, National Conservation Commission and the National Housing Corporation all tell a sorry story.
Then the uncertainties which hover over the Rural and Urban Development Commissions and Kensington Oval Management Inc., among others, speak to sound reasons why the public should be worried about persistent financial assistance in whatever form to keep any of these institutions afloat.
The facts show that they have consistently been money losers and the prospects of them making a turnaround are very dim. These operations make little if any contribution to the Treasury and in many instances their accounts are not up to date and cannot be scrutinised. Governance of many of these state-owned businesses is not in keeping with what is expected and required today where accountability and transparency are mandatory.
The country cannot afford to continue carrying the financial burden of loss-making agencies only on the argument that they provide services which the private sector will or cannot offer. The reality is that these kinds of state-controlled operations have been privatised in other jurisdictions without any undue harm to the most vulnerable in society.
This is why divestment must not be made into a bad word loaded with negative connotations. What we should learn from the sale of the BNTCL is the need to effectively do all the due diligence required, including involving the regulators, before attempting to conclude the sale. The bureaucracy must be more efficient.
Barbados can no longer depend on either its Central Bank or National Insurance Scheme to prop up the Government. Neither will more taxation solve the country’s financial problems.
Given these circumstances, the Freundel Stuart administration must stop dragging its feet on this matter of privatisation while the country totters on the brink of economic ruin given its perilous fiscal deficit. Privatisation of some state assets can be a positive.