Business View Caribbean | October 2022

15 BUSINESS VIEW CARIBBEAN VOLUME 9, ISSUE 10 OFF I CE OF THE PR IME MINI STER OF BARBADOS would have increased the cost of living substantially and undermined the purchasing power of ordinary Barbadians. So, they understood that we needed to make some tough choices.” Describing a planned and careful approach, he says, “It was one of the most shared debt restructurings in history. It wasn’t disproportionately on workers like almost all others. It was shared between the owners of capital, bondholders experienced a loss, and there was some loss of public sector workers. But all that was contained to a minimum amount,because in the external sector, tourists paid more for their hotel rooms and paid more VAT on arriving in the country.” Fortunately, just before COVID hit, things started to look up for Barbados. As Persaud describes, “If we had gone into COVID without the restructuring we would have been able to respond in the way we did. Because we had significantly reduced our debt, were in an IMF program, were working closely with the World Bank, and the Inter American Development Bank and were hitting our structural reform targets, they were very supportive of the response we needed. We were able to respond rapidly in terms of health,welfare and employment as much as possible.” With a 40% unemployment rate at the peak of COVID in 2020, Barbados introduced the Barbados Employment & Sustainable Transformation (BEST) program, aimed at the hotel sector. “We invested in the sector and they used that money to maintain employment as much as possible, keep the hotels working and open. Forty percent of our economy is tourism, so that was very important, and that meant we managed to survive.” During this time the country also paid out approximately $150 million in unemployment benefits, which