Attorney General Dale Marshall and Prime Minister Mia Mottley of Barbados continue to dismiss critics of the government of Barbados on economic decisions to lower debt burden, critical to stabilizing the economy, stated that, White Oak Consultancy has been playing a significant role in preventing many more layoffs than occurred under Barbados’ Economic Recovery and Transformation (BERT) programme.
Mottley acquired a distressed $5 billion economy when she assumed office last May, swiftly struck a $290 million deal with the International Monetary Fund (IMF) and revamped around $6 billion in local currency debt.
The government owes around $700 million in dollar bonds, plus bank loans and other foreign debts, in January and bonds maturing in 2035 have rarely traded in recent months, according to data compiled by Bloomberg.
Steadfast to revamp Barbados debt, Mottley, “will not compromise” on “unsustainably high debt responsibility”, with the aim of taking that ratio down to 60 percent by the year 2033, reiterated, “In 1991 to 1994, we had a problem with our foreign reserves but today we have a problem with our reserves and with our debt.”
This has been a sticking point and a long discussion sometimes at odds with creditors to revamp substantial sovereign debt loads.
At a Barbados Labour Party’s (BLP) public meeting held recently, Mottley explained: “In 1991 to 1994, the Erskine Sandiford-led administration sent home 4,000 public servants and cut salaries by eight percent. In 2014, when we met here, the Dems had already sent home 3,000. Your government (BLP) has said no, we are not putting workers on the frontline of change in this country and we would ask the people who were making profits in the banks to bear the burden. That is what White Oak has helped us to negotiate,” said Mottley.
Mottley also defended the contentious US$27 million in fees, especially after an article published in May by the London-based Financial Times newspaper and explained that Barbados had gotten a great deal.
“Not only did White Oak not get paid a lot of money, but we told them they couldn’t get the money all at once and we spread it across four years and by the time we told them, to help to restructure the arrears. What is sad, is that you are trying to titillate people with the numbers without telling people that they [White Oak] have served this country and allowed us to move forward,” alluding to government accountability and transparency in the debt restructuring process.”
“When a party wins 74 percent, every single seat, it has a duty to act responsibly and a duty to treat to things and people differently.” Mottley disclosed.
Attorney General Marshall meantime, blamed the prior administration of neglecting to select the firm nearly a decade ago in 2011 when White Oak acquainted itself to the then The Democratic Labour Party (DLP) government.
According to Marshall, White Oak wrote a letter explaining it had been closely observing Barbados’ spiralling debt circumstance and was prepared to aid with managing the deteriorating condition.
Marshall said letters were also written in 2014 and 2017 to then prime minister Freundel Stuart, and Chris Sinckler respectively, but each was snubbed.
“A stitch in time saves nine. White Oak came in and assisted this Barbados Labor Party administration and saved us a billion dollars a year in interest payments. Had Chris Sinckler had the common sense or common decency to listen to White Oak in 2011, you would have buses on your roads and you would have good roads for them to drive on,” Marshall said.
“That is why we love them so [White Oak] because they’re persistent. And they’re persistent with the creditors. They were so persistent that they wrote Sinckler again in 2017,” he said.
He also defended the present administration amid allegations of a lack of transparency in appointing White Oak consultancy and explained that Barbados’ situation was so “grave” there was frankly no time after the administration took office last year.
“There was no time to tender because the process would have taken too long and Barbados would have been “stone dead”, he continued. The first discussion at our first cabinet meeting was whether we should engage this same company, White Oak, that has done seven of the largest restructurings and seven of the last 11 restructurings over the last ten years.
A company with an impeccable record and we made the decision at our first cabinet meeting. White Oak is saving us a billion dollars a year and their fees are millions of dollars. But we recognize that our situation was so grave that we had to find the finest skills that money could buy, to resurrect this country,” Marshall said.