Following the statement by the Minister of Finance on the 2012-2013 Financial Statements and Budgetary Proposals on 26 June, Executive Director of the Barbados Coalition of Services Industries (BCSI) Ms. Lisa R. Cummins said our expectations of the budgetary proposals clearly needed to reflect an understanding of the need for fiscal prudence and careful management of our deficit during recessionary times. We think that the budgetary proposals reflected that reality and the policy space within which we must now operate.
At the same time, while recessionary periods may not allow the space for an extensive short term economic incentives to the extent that we would ideally like to see, in periods of boom, it does give us the developmental space to craft new macro strategies which will allow for the reemergence of our key productive sectors and to position Barbados to emerge from this season, bigger, better and more competitive as a result in the medium to longer term.
The Executive Director went on to say that, “These times force us to be at our most creative, to balance austerity with medium to long term structural transformation of the economy.’ In a lot of ways we need more of that particularly with respect to the services economy which is among the major drivers of the economy but remains largely un-documented.
The BCSI did not expect major concessions to the sector at this time but what we were hoping for and still hope to have the opportunity to engage with the Government on, is the development of a new model for the services economy which maps out a coherent and strategic vision for where we see ourselves 10- 15 years down the line in terms of our legitimate national ambitions. Individual measures that are not codified in a concise overall vision/plan are not likely to result in the kind of efficiencies originally envisaged. They need, because the services sector is so large, to be incorporated into a concise overall developmental strategy that promotes synergies, horizontal linkages between and among sectors and has as its ultimate output an improvement in the performance of the sector and all its attendant benefits including economic growth. And that strategy will need to be allocated the requisite resources to support its development and implementation.
We have for example our business and professionals services which need substantial development support to be positioned to compete and support sectors like international business which requires the highest skilled and specialists who are globally marketable. We have our core infrastructure services like transportation, finance and technology which need to be supported in order to propel initiatives in manufacturing and agriculture.
Then we have new emerging and high growth sectors like the cultural industries which if supported strategically developmentally over the next five years through solid internationally benchmarked policies would be a major pillar of our economy and generate millions of dollars in foreign exchange, employment and entrepreneurial growth.
And all of these sectors have cross cutting linkages to other sectors and sub-sectors. So we have to be strategic in our vision for the way forward and seek to exploit those synergies and promote the enabling environment for growth in the sector.
We have submitted a proposal to the Government that we hope can form the basis of a constructive discussion on how the services sector needs to be supported in order to drive other sectors in the wider economy and we are confident that in time to come we will be able to announce that we have commenced the long road towards 21st century structural transformation of our services economy to face the challenges not of today but of tomorrow. That needs to also be our agenda as we pursue necessary recessionary policies.
This must be our time, as a small open economy, to use that size to our advantage and be nimble and agile in our adjustment process to the world that we operate in.