Economist Dr Antonio Alleyne cautioned Wednesday that despite recent improvements in Barbados’ debt and growth figures, the economy remains deeply vulnerable and unchanged underneath, leaving it exposed to external shocks and growing internal pressures without urgent structural reform.
In a Barbados TODAY interview on the country’s financial independence ahead of the 59th independence anniversary, Alleyne acknowledged that the macroeconomic picture has improved, with the Central Bank reporting that the debt-to-GDP ratio fell to just over 100 per cent at the end of September and first-quarter real GDP rising an estimated 2.6 per cent, supported by tourism and construction.
The Central Bank has also projected growth of around 2.7 per cent for the full year and continues to report strong international reserves.
But Alleyne stressed that while those numbers reflect stabilisation, they do not reflect transformation.
“Debt is marginally declining, so that’s a positive sign,” he said. “But the structure of the economy hasn’t really changed. We’re still tourism-heavily dependent, propped up by things like construction. It doesn’t offer any real enhancement in terms of diversity or sustainability.”
Even with improvements in fiscal performance and external balances, Barbados remains as vulnerable as it was before the 2018 debt crisis because the underlying economic engines have not shifted, he said.
“The structure isn’t changing, so the vulnerabilities are still there,” he said, adding that global shocks, climate-related disruptions, and rising domestic crime will all demand new resources that the existing economic base cannot readily supply.
Alleyne said the country now faces a delicate dilemma: “You can’t really say it’s better because the structure isn’t changing, but you also can’t say it’s worse because the debt is somewhat coming down.”
“So you see the dilemma we’re in.”
The economist argued that the improvement in headline indicators must be interpreted alongside the fact that government’s debt-service obligations remain high.
“When your debt-service ratio is around the seventies, your services are at a very high rate,” he said. “That’s good in one sense, but then you don’t have the funds to really develop the economy.” He added that the downward movement in debt may not reflect the full picture. “It seems as though the debt may be coming down by ignoring some of the other aspects that need to be addressed,” he said, suggesting that important areas of national development may be underfunded.
While the Central Bank has highlighted progress in stabilising the economy, including strong reserves, improved foreign exchange earnings, and primary surpluses, Alleyne insisted that these gains remain fragile unless they are accompanied by a broader economic shift.
“I don’t believe the two per cent we keep talking about is real economic growth,” he said. “Where is the money? Where are you seeing it on the ground? If you grow in just numbers, and for a country that imports everything, you’re not really doing anything.” Alleyne also questioned whether Barbados is fully utilising its diaspora, arguing that educated nationals living abroad should play a bigger role in national development.
“The biggest problem is the desire of the educated population to support their own back home,” he said. “The government keeps calling on nationals overseas to contribute — but have we really seen it? It’s not just remittances; it’s a broader contribution.”
Asked whether Barbados could ever achieve true financial independence, Alleyne said the country’s size and limited resources make that unlikely. “I don’t think we can ever become truly financially independent, not with our size and limited resources,” he said.
“We must borrow money, but you have to borrow for development purposes. The country must be growing, which we are not necessarily. True development must be seen, not just written in a report.”
Though emphasising that Barbados is not “going totally bad,” he said the country remains stalled in several key areas.
“Things may be slow, and we have areas we need to plug,” he said. “But if the economy isn’t changing internally, if the structure isn’t changing, then you can’t really say it’s better than before.”