As the Caricom heads of government start their 28th conference in Barbados, the gathering storm in Barbados around a possible take over of its largest company, Barbados Shipping and Trading (BS&T) has to be a important signal in the move toward making the Caribbean Single Market Economy more than a slogan. In Barbados, news broke in mid-May that a major conglomerate from Trinidad (Neal and Massy) planned to take over the most important of Barbados’ nationally-owned companies (BS&T) sent shock waves through the island and the meter measuring national fear of foreign invasion shot up into the “danger” zone (see cartoon from The Nation). When, several days ago, a hostile counter bid was made by another Trinidadian entity, Ansa McAl, which already had singificant investments in Barbadian companies, Bajan concern about being taken over by Trinidad got feverish.
The fact that BS&T has prided itself on shaping its own expansion by moving into other Caribbean countries or further afield does not help Bajans make sense of why Barbados’ main company may “fall into the hands of Trinidadians”. There is more to this national concern than a corporate battle. Barbados and Trinidad are just coming out of the latest of a series of territorial rivalries, the latest involving limits to territorial waters. This focused mostly on fishing rights, but also touched on access to possible new oil discoveries. Each country would like to be the power house in the English speaking southern Caribbean. Trinidad has had the upper hand recently due to its surge in income on the back of the latest upswing in oil and gas prices. What the country and its enterprises are doing makes some sense in using its recent increase in wealth to diversify in non-petroleum based industries. It is easier to do this in the English Caribbean than elsewhere for a number of reason, not least being that it is possible within Caricom.
Those of us who are not Barbadians sense that the “concerns” about Trinidadian incursions don’t seem to be paralleled if a UK or other foreign investor appears to be coming into the island. Some of that may be due to the relative size of the potential rivals: Barbados feels that it is in Trinidad’s league, so anything given away between these two countries will singificantly affect their relative standings. Barbados is clearly not in the same league as the UK, US or Canada, for example. Some of the absence of concern may come from a less flattering view about deferrence to these countries. If other foreigners cause concern it will be around perceived “cultural threats” or apparent “job threats”. Both aspects can be seen in the context of the hullaballoo about the recent influx of Chinese workers to develop the new Four Seasons hotel-villa-condominium project, or regarding the influx of Guyanese (who also get tainted as at the root of a possible upsurge in crime).
I imagine that in coming weeks more of the discussion around the change of ownership of BS&T will be triggered by the hostility that exists between Barbados and Trinidad than by the merits of a take over. It has been startling how little analysis has gone on into the quality of BS&T as a take over target, and its initial two suitors. The appearance at the “11th hour” of a Bajan-led consortium ready to put up US$ 75 million to “keep BS&T in Barbadian hands” seems to have comforted national concerns. Yet, and intelligent person has to search hard to find even the shreds of any assessment, which could explain why BS&T is a prime take-over target. Little grains are now dropping that the company has been poorly run and underperforming for some time.
But this touches on something troubling about the development toward CSME. The region has a very literate and well-educated population (our people are our greatest asset we are told so often). Yet, the efforts to educate this population in terms of understanding the realities of certain aspects of economic progress, particularly in the area of capital markets and corporate consolidation, have been limited. It does not matter whether these aspects are tied to the need to develop and widen trading in government securities, corporate equity or debt, or understanding the needs for expansion beyond national boundaries. Most ordinary people have been left to watch capital markets become the play thing of a very few. None of the national stock exchanges is really very active. Trading in government securities is much more limited than it should be. One consequence of this is the dearth of analysis, which would point to some of the weaknesses and strengths in the corporate make up of the countries. The other consequence is that people have little to fall back on but emotion when it comes to assessing the merits of major economic developments. Some would see this a part of a “politicial” strategy, whereby government and the major players in the economy keep more control over developments than should be the case simply because they are amongst the few who are well informed. This also sends an indictment of those economists and experts in business and finance who appear to be so silent in the discussions of these issues. There may be many explanations for that silence, but it is nevertheless deafening.
The BS&T take over is moving into a messy phase. Some of the important issues have already been mixed up with national emotions and politics (because the election calendars have to be considered). Yet, many of the important issues have yet to surface. The way the affair has moved so far does not speak well of how the countries in the region see each other. None of this is good for the region’s development.