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guyanatimesgy.com
monday, june 9, 2014
Views Editor: Nigel Williams Tel: 225-5128, 231-0397, 226-9921, 226-2102, 223-7230 or 223-7231. Fax: 225-5134 Mailing address: 238 Camp & Quamina Streets, Georgetown Email: news@guyanatimesgy.com, sales@guyanatimesgy.com
Editorial
Bajan meltdown B
arbados is plunging inexorably into a financial meltdown that was signalled since the middle of last year when the international rating agencies began downgrading its once-stellar financial bona fides. In February, the International Monetary Fund (IMF) reported that the island’s debt reached 94 per cent of Gross Domestic Product, up from 60 per cent in 2009. The economy shrank 0.7 per cent in 2012 following an average of 0.6 per cent per year since 2008. The Government initiated a menu of measures that had been signalled earlier by the IMF and which included laying off some 3000 public sector workers and raising the excise and Value Added Tax (VAT). However, it appears that the Government’s programme might have been a case of “too little, too late”, since last week Moody’s Investor Service downgraded Barbados Bonds to “junk bond” status. Two days later, the IMF swooped down on Little England and in a double whammy, confirmed that “real GDP is expected to decline by 0.6 per cent this year”. The IMF warned that more stringent measures will have to be taken. Moody’s rating action has effectively closed the door on Barbados’ access to international private capital and on June 23, the Government is scheduled to meet foreign holders of US$0.5 billion in dollar and sterling bonds. With debt servicing tripling by next year, there is the distinct possibility of Barbados being pushed into default. Late last year, the Government had to withdraw a US$250 million bond issue, because there were no takers on its first offer on junk credit. In contrast, even The Bahamas, which also has challenges, was able to raise more than double that amount three months later at a lower interest rate. Part of the problem, which is almost certain to lead Barbados to enter into an IMF conditionality programme before year-end, is that the Government’s initiatives are selfdefeating. For instance, while seeking to reduce its deficit, it increased the Local Loans Limit to $4 billion and subsequently the Special Loans Act by $1 billion to $2.5 billion. As even the World Bank now accepts, it is increased loans that lead to the creation of money in the economy. Bajans should not be surprised, therefore, that the Central Bank has had to keep the money printing presses rolling overtime and will be increasingly hard-pressed to keep its vaunted 2:1 exchange rate with the US dollar. But while everyone has focused on the drop in tourism (which is not going to change dramatically soon, unless the Bajans start courting Chinese tourists) as the cause of the financial meltdown, there are other less proximate but no less significant precipitators. One of these is the unremarked status of Barbados as a tax haven for foreign, primarily Canadian funds. There are more than 1000 Canadian companies with shell operations in Barbados that facilitate Canadian companies to reduce their tax rates from 23 or 24 per cent to two and a half per cent. With international moves to clamp down on these offshore activities, some of the money has moved out. Banks have gotten jittery. Canadian Imperial Bank of Commerce warned last week that it will take a US$420 million charge to goodwill related to its subsidiary CIBC FirstCaribbean, which it blamed on “persistently challenging economic conditions and our current expectations for conditions going forward”. In addition, it took US$123 million of additional loan losses. But Sir Frank Alleyne, the veteran economist who chairs the Barbados Government’s council of advisers, was candid: “What has happened in Barbados is that we have developed an entitlement society. Nothing is free in life. Education and the health-care services in Barbados have never been free, they have been tax-financed.... What I worry about is that those of us who have benefited from taxpayer-financed education feel somehow that the society owes them something.” Will Bajans be able to face the real world while under the ministrations of the IMF?
Members of the National Dance Company team up with the Nrityageet dancers to perform the closing act at the Guyana Music Teachers Association Young Musicians on Stage production, held at the National Cultural Centre on Sunday (Carl Croker photo)
The Facebook group, the suicide epidemic Dear Editor, https://www.facebook. com/groups/suicideepidemic/ https://www.youtube.com/user/ab10460/ feed?view_as=public realises that there have been/ are quite a number of initiatives relating to suicide prevention that, if located in a national, sustainable framework, can significantly impact suicide prevention within a short span of time. Perhaps the National Committee for the Prevention of Suicidal Behaviour (NCPSC) or the National Committee for Suicide Prevention (NCSP) that were launched in 2007 ought to be resuscitated or revitalised as the case may be. We strongly suggest that such a body be headed by a mental health professional and comprise all possible stakeholders, including related Government agencies/ ministries and the political Opposition, as well as NonGovernmental Organisations (NGOs), especially those that are national in character and draw their membership from throughout the nation and/or those that have been doing significant work in suicide prevention and related social issues. This central framework can also create a roster of all entities, locally and internationally, that are already working or desirous of working to address suicide and related social issues, and an annual calendar of related activities so as to ensure maximisation of efforts spread out as widely as possible. Meanwhile, we applaud the move to set up a suicide hotline as recently spelt out
by the Police Commissioner (ag), and we sincerely hope that the logistics would be put in place to ensure that the hotline is always accessible and manned on a 24hour basis. In this respect, we urge a reconsideration of the Gatekeeper’s Programme, which would create a national network of responders who can be accessed by those who call the hotline, as a follow-up to speaking with hotline counsellors. We understand that this programme, which was launched with quite a bit of fanfare, has been shelved even though it had begun to create an impact. Additionally, we strongly suggest that the Cops and Faith Community Network (CFCN) initiative be extended to all Guyana as is being considered by the Government, especially given its possibilities for problem-solving and community building. Furthermore, the Police Force’s plans to sensitise officers to domestic violence, gender-based violence, sexual offences, and trafficking in persons should also be ongoing and eventually encompass every officer. In toto, this approach will definitely reduce suicides, in addition to achieving other set goals. Thirdly, in light of a number of incidents relating to orphanages and institutions that house the young, such as the New Opportunity Corp (NOC), we urge the relevant ministries to set up mechanisms to ensure both protection of these young people as well as fostering of the appropriate environments.
Perhaps setting up community boards or community-based committees/councils to oversee and assist these institutions might serve to ensure safe and nurturing environments and might also lead to garnering more resources to such institutions. Fourthly, we applaud the various faith-based initiatives that have taken place recently, such as the ones held last month by Freedom Health Ministries and Bethel Gospel Hall. Ditto for the work of NGOs such as the Guyana Foundation and the Diaspora-based New Jersey Arya Samaj Mandir (NJASM) Humanitarian Mission spearheaded by Pandit Suresh Sugrim and CADVA, spearheaded by Sukree Boodram and Dianne Madray (our apologies for not being able to tabulate a comprehensive list here). While we note the presence of some Government involvement at some of these events, we believe that in the future all these initiatives should include the presence of related Government agencies not only for the purposes of coordination but also with respect to follow-up. Fifthly, we hope that the Guyana Foundationfostered research by Ms Serena Coultress of Maastricht University in the Netherlands will be made public and used to drive planning and implementation, especially given that the stats we cited in our last letter were old, even though they were the only ones publicly available. Finally, in keeping with the multi-sectoral approach outlined by Health Minister,
Dr Bheri Ramsaran, and adopted by the Police Force, we hope that sensitisation would be built into planning at all levels. For instance, local businesses and professionals in every community can help to underwrite billboards and banners created by artists and artisans within the communities themselves. Also, through the auspices of the Education Ministry, schools can arrange workshops/seminars for parents and teachers, efforts that would supplement the Health and Family Life Education Programme currently in effect for students. And through the efforts of central religious institutions such as the Guyana Council of Churches, the Dharmic Sabha and the Central Islamic Organisation of Guyana, outreaches can be made to every church, mandir, and mosque. We are quite willing to reach out to others and together provide what assistance is possible and we intend to touch bases with various government agencies in the near future to explore this possibility. Meanwhile, we laud the press statement on suicide put out by A Partnership for National Unity (APNU) on June 6 and hope that APNU too will become a significant stakeholder in the campaign to address this scourge that is destroying valuable human resource, especially our young. Sincerely, Norkah Carter Devv-Ramdass Danile Judy Deveaux Annan Boodram