BLEAK TIMES
by GERALYN EDWARD
SOME COMPANIES in Barbados and the neighbouring islands are buckling under the pressure of the economic recession and most have little or no capital investments planned for the next six to 12 months.
These findings were revealed in a just released Corporate Performance And Outlook Survey undertaken by the Department of Management Studies, Cave Hill Campus of the University of the West Indies (UWI).
The survey, the first of its kind in Barbados and the Organisation of Eastern Caribbean States (OECS), examined how companies performed in the first half of this year when the recession was taking hold and how they perceived they would perform over the next six to 12 months.
According to the report, the financial performance index showed that most of the 758 companies surveyed - including those in Barbados - had a worsened performance over the last six months. Interestingly, most companies in Grenada, Dominica and St Kitts reported unchanged or improved performance.
When it came to industries, the report said entertainment, education and cultural services weathered the storm and bettered their financial performance, while tourism and financial services declined as expected.
Regarding the outlook, the private sectors in Barbados, Grenada and Antigua felt their financial situation would improve over the next six months.
Bleak outlook
“The investment outlook for the corporate sector in Barbados and the OECS is bleak over the next six to 12 months. The survey’s results indicate that the majority of companies have no capital investments of any kind planned over the next six to 12 months,” the report stated.
Unlike companies in the international community, regional companies were “disinclined to lay off workers” as a means of handling the crisis.
Dr Justin Robinson, head of the UWI Department of Management Studies, told BARBADOS BUSINESS AUTHORITY the survey was the university’s way of taking the pulse of the private sector and keeping track of how they expected the economy to turn.
“We get a lot of macro information but that does not take us into what is happening on the ground . . . . We don’t get information on confidence in the private sector. We get a lot of macro data, but when the crisis broke there was a sense that there was no warning system. What we need is information at the micro level,” Robinson added. (Nation News)