Nadaleen Singh

Bar­ba­dos does not plan to de­val­ue its cur­ren­cy. The is­land's Min­is­ter of Fi­nance Christo­pher Sinck­ler said de­val­u­a­tion will not make sense.

"The type of econ­o­my we have just does not suit cur­ren­cy de­val­u­a­tion, or even cur­ren­cy volatil­i­ty in terms of float­ing pegs as you may have here in Trinidad and To­ba­go. It just doesn't work," he said.

"We don't ex­port a lot of com­modi­ties or man­u­fac­tured goods, so there would be no rea­son for do­ing that. Most of what we do is through im­port, so if you re­duce the val­ue of your cur­ren­cy, it in­creas­es the amount you will have to pay on the amount im­port­ed."

Sinck­ler, who was in T&T for a Bar­ba­dos In­vestor Fo­rum at the Trinidad Hilton and Con­fer­ence Cen­tre yes­ter­day, said one of his gov­ern­ment's goals is to re­duce the coun­try's deficit to about two per cent by 2019.

Fol­low­ing the glob­al eco­nom­ic down­turn, the Bar­ba­dos econ­o­my de­clined by four per cent.

In its lat­est as­sess­ment ear­li­er this year, the In­ter­na­tion­al Mon­e­tary Fund said the is­land ap­pears to have "turned the cor­ner" with ac­tiv­i­ty pick­ing up. Re­al gross do­mes­tic prod­uct (GDP) grew by 0.8 per cent last year, un­der­pinned by a surge in tourism ar­rivals and em­ploy­ment in­creased by two per­cent.

Sinck­ler said on an ac­cru­al ba­sis, the deficit now stands at ap­prox­i­mate­ly 5.4 per cent.

He ad­mit­ted that achiev­ing the a sig­nif­i­cant re­duc­tion in the deficit is go­ing to be dif­fi­cult be­cause it means chang­ing the way the pub­lic sec­tor per­forms in terms of build­ing ef­fi­cien­cies.

"So that is why we are be­ing as de­lib­er­ate as we are, and not try­ing to do all in one, be­cause the dis­rup­tion would be too much but we are phas­ing it over time," he said.

The min­is­ter added that with a new rev­enue au­thor­i­ty and new tax­ing po­si­tions in place, the ex­pec­ta­tion is that eco­nom­ic ac­tiv­i­ty will picks up be­cause of in­vest­ment.

"We'll be­gin to see more pick up in those ar­eas, so you get your rev­enue go­ing up, you get your ex­pen­di­ture com­ing down–the clos­er they are be­tween the two means a low­er deficit over a pe­ri­od of time. That's how we are ap­proach­ing it," he said.