Role of Central Bank

We are not a bit surprised that former Governor of the Central Bank, Sir Courtney Blackman is blaming both the Barbados Labour Party and the Democratic Labour Party for the current financial woes. We are also not surprised, that the current Governor, Dr. DeLisle Worrell, is saying that the existing financial sector stymies or does not support innovation and creative enterprises. In layman’s terms it really means, that those citizens with start up enterprises, cannot get them financed.

These two statements show beyond a shadow of doubt that the current crisis, is not going to be abated by the noise coming from the apologists of the government and opposition. When stripped of their diplomatic sheets, they convey a bankruptcy rampant in both of these political dinosaurs (BLP and DLP). The simple truth is that both parties have paid nothing but lip service to creating a new entrepreneurial class and have bogged themselves down in economic models that are no longer relevant. We are left with ego based arguments from economists, who are merely singing for their political supper.

Both Governors have failed to admit that the Central Bank itself is a model of a decaying economic management structure that can scarcely move beyond collecting data and regulating the commercial banks.  The Central bank itself can do little to facilitate any radical changes in the economy. Indeed, it was Dr. Blackman himself, who once stated that the Governor of the Central Bank is “a creature of the Minister of Finance”. We believe that his statement justifies our position about the relevance of the Central Bank in economic planning. The Minister of Finance is a politician first and foremost, if Dr. Blackman’s position holds true; it means that Governors of Central Banks are actually political creatures!

Recently, while addressing the Barbados Association of Insurance and Financial Advisors, the current Governor of the Central Bank, Dr. DeLisle Worrell, suggested that the Barbados financial system is “failing” innovators. Dr Worrell told his audience that he did not have the answers for   filling “gap” which exists between traditional financing and that for new business in such areas as energy and culture. Such an admission from the Governor would not have been good news for the hundreds of citizens trying to get their businesses off the ground.

When we examine the two positions of the Governors, we are forced to ask: What is the real function of the Central bank. Is it merely a political tool or is it incapable of assisting with the emergence of the new economy?

We believe that   a $100 million Fund should be immediately set up, to jump start small businesses. We also believe that the establishment of at least six Entrepreneurial colleges, with rolls not exceeding 200 each will assist in developing present and future business persons.

It is time for political gymnastics to end and real progressive policy changes to be made. It is also time for the role of the Central Bank to be revisited.