Recently, I was reading an article about the debt crisis in Cyprus and the author was making the point that debt is a silent killer. I started to draw comparisons with the ‘silent killer’ that we face in our own daily lives called hypertension. We fail to exercise discipline in what we eat, we do not exercise our bodies and the arteries get clogged over time and it takes a lot more to push the blood around the body.
For a country, the nation fails to exercise discipline in their spending habits, and over time the debt slows down the ability to push resources around that nation, and sometime there is a sudden upsurge of violence, the national heart attack.
As it is in the natural so is it also for the nation with such issues facing it. There is need to diagnose the problem and start the therapy. A stimulus package can be the defibrillator for any economy, but the discipline in expenditure and the increased exercise in the swift implementation of projects are fundamental approaches to returning to a healthy economy.
Recently the Central Bank Governor of Barbados made a startling remark by saying that Barbados has no debt problem. Dr. Worrell opined that debt to GDP ratio was not an informative gauge and what matters was a country’s ability to service its foreign debt. He went on to state that Barbados is not one of those most highly indebted countries in the world, that Barbados is on par with Germany and Canada and below the United States and Japan.
Dr Worrell went on to state; ‘’What matters in Barbados and in small, open economies is your foreign debt and, more precisely, the servicing costs of your foreign debt. We used to know that. When I was an undergraduate, that’s what we were taught,”

The Central Bank Governor seems to be saying that there is a double standard practiced by the International Monetary Fund ( IMF) which is contrary to the core of economic theory. I found these statements most intriguing. With my very simplistic understanding of an economy, I would also assume that high levels of debt in a small open economy where your primary source of foreign exchange is in a stagnant service sector, will undoubtedly affect your ability to service that ballooning debt. However I never studied economics and thus cannot challenge what was taught at undergraduate level.

Whether this position of Dr. Worrell has spurred the Government of Barbados to reverse their position on fiscal stimulus, one does not know. However, from a pre-election position that Barbados should not pursue any stimulus, to a post election position that a $ 600 million stimulus is being pursued is confusing.

For St, Lucia, I would maintain that we have to fix our implementation capacity for our loan funds. As one grows older there is an increasing intolerance to the turgidity of the bureaucracy of government. I continue to be amazed that we have been unable to get the Hurricane Tomas projects going in St. Lucia after over two years of funding being available. I have made a guestimate that there is over $ 150 million dollars in loan funds ( from the World Bank, CDB and other institutions) that are available and stuck in the implementation phase in St. Lucia.

Certainly this cannot continue and there has to be a vigorous response by the Government to deal with this situation, and it will call for unorthodox measures. I am proposing that a “CZAR” be appointed with the sole purpose of accelerating the implementation of loan funds. This individual will be empowered to move freely to unblock the ‘arteries’ within the various branches of government. The individual should be answerable to the Office of the Prime Minister.
If St. Lucia can get these projects implemented within this financial year, there will be growth in the economy and a significant impact in the levels of unemployment. Parallel to this acceleration of the implementation of the loan funds is a programme of generating savings in the cost of government providing services.
King Solomon left some wise words of wisdom to governments, it is found in Ecclesiastes 10: 18-19, which is so vividly stated in the Amplified Version of the Bible.
Through indolence the rafters [of state affairs] decay and the roof sinks in, and through idleness of the hands the house leaks.
19 [Instead of repairing the breaches, the officials] make a feast for laughter, serve wine to cheer life, and [depend on tax] money to answer for all of it.
Solomon was saying that the rafters of state affairs were left to decay causing the complete collapse of the roof, and instead of repairing the breaches the officials continued with their spending ways making feasts, serving expensive wines and were looking for tax money to pay for it all.
This is ample evidence that Solomon was indeed the wisest man who ever lived.