The Minister in the Ministry of Finance, Ryan R. Straughn, Tuesday defended the move by the new Barbados government to ensure that all nationals who had invested in the government’s securities are not placed at a disadvantage.
“Persons who currently hold securities issued by the government of Barbados, if we were to continue as the previous government did, it is very likely you would not get back the very investments that you put it. That’s the harsh reality,” Straughn told the Lower House as legislators debated the legislation to afford a measure of protection to those investments.
The Mia Amor Mottley government, which came to power in May this year, has had to enter into an agreement with the International Monetary Fund (IMF) in a bid to reverse the ailing economy and has also indicated that it was putting measures in place to deal with the repayment of funds owed to creditors and investors.
Straughn said that the choice facing Barbadians is “clear” indicating that ‘the terms we are offering allows you, the holder of this security to get back your principal on your investment over the period of time in a way that allows the government to pay you easier, rather than…in the current system where if you purchase any government security right now, the only thing you will get right now is the interest…”
Straughn told legislators that wherever you go across Barbados “you can’t go anywhere…and the government does not owe somebody.
“It is serious and this comprehensive debt restructuring is absolutely required because to bring back some order, not just to the public financing but certainly in the way that government provides goods and services”.
He said it was necessary also to do so because ‘when any minister of finance, any prime minister, any member of this government says that we are going to do something and we have set about the plans of allocating the resources to do whatever that something is, sir, that the people involved can count on that activity and not have to worry about whether or not the money will be available”.
Last week, Straughn, said that the new administration would protect the interests of all persons who bought savings bonds from the government three years ago.
Addressing the Barbados Stock Exchange’s Sixth Annual Conference on Corporate Governance and Accountability, Straughn said “it is important to point out that the government of Barbados has decided to ring fence those holders of savings bonds on the basis that the principles of good corporate governance were not followed.
“The fact that the minimum deposit rate was reduced in such dramatic fashion, whilst almost simultaneously offering the public the opportunity to earn a return of 5.5 per cent, was simply too good to pass up,” he added.