Barbados: new opportunities for investment.

As the Caricom Single Market and Economy (CSME) comes into force, Barbados, Jamaica and Trinidad and Tobago are expected to be the first signatories. "As we go into the CSME, one of Barbados' priorities must be to improve our competitiveness," said Dr. Marion Williams, governor, Central Bank of Barbados.

"Tourism, the major foreign exchange earner, will be boosted by an upgrade to Grantley Adams International Airport, the Bridgetown Harbour and the reopening of the Hilton Hotel. "However, for tourism to reap maximum benefits from the developments, there must be additional spending on refurbishing and raising of the quality of heritage sites and ancillary facilities," Williams said.

As the Finals of World Cup 2007 will be held in Barbados, the government is starting this year to give incentives for improved accommodations and is spending substantial sums on upgrading the road network and sporting facilities.

In the financial sector, Barbados has always placed more emphasis on attracting entities with the highest integrity than on competing for the highest number of firms, said Williams. The country remains open to applicants with a good track record or whose "bona fides" are beyond question.

"There are many advantages to doing business in Barbados," concluded Williams. "These include a literate and well-trained workforce, a stable, well-governed democracy with respect for property and human rights, excellent communications and a tripartite arrangement among government, business and the labour movement. The country also has easy access from major financial centres, excellent communications as well as world-class physical and social infrastructure."

Opportunities for investors exist in traditional activities like tourism and international business. Joint ventures are being sought for manufacturing projects, particularly those on the cutting edge of technology. Foreign investors should also be attracted to opportunities in agriculture, with the reorientation of sugar cane cultivation and the establishment of a cotton industry with great potential for the manufacture of clothing.

Barbados currently produces some petroleum, but there are indications that the amount could be significantly increased.

In 2004, Barbados experienced a 17.8 percent rise in the value of imported goods while merchandise exports grew by only 5.3 percent. At the same time, net inflows from services rose by 5.8 percent, compared with 17.6 percent in 2003 and foreign capital inflows were estimated at nearly $386 million lower than in 2003.

In an effort to dampen import demand, the Central Bank is increasing deposit rates by 50 basis points from April 1, 2005. This should have the effect of enticing higher savings at the expense of consumption.

Barbados plans to stimulate domestic exports and the inflows from tourism, with incentives for the small hotel sector through a bond to be floated shortly. Plans are also underway to raise the spending of cruise ship tourists. Initiatives targeting excellence, the reduction of public service bureaucracy, and lower telecommunications will also benefit foreign exchange earnings from tourism, manufacturing and international services.

For more information, visit www.centralbank.org.bb.