Bridgetown.
Professor of Economic at the Cave Hill Campus of the University of the West Indies, Dr Michael Howard has described Government proposed $600 million economic stimulus as madness and warned that the country cannot afford.
Howard has suggested that given the weakness of the island's productive sectors, its large fiscal deficit, sluggish tax receipts and downgrade to junk status, a policy of austerity and expenditure reduction was the better option.
"The proposal by the Democratic Labour Party (DLP) Government of a stimulus package for the Barbados economy is economic madness. This is the same Government that opposed a $90 million stimulus package proposed by the BLP Opposition before the general elections", says Howard.
"Government is running a huge fiscal deficit and had has already been downgraded by two rating agencies. The productive sectors on the island are not doing any better than they were before the elections. Fiscal revenues are sluggish and support a $600 million in Government expenditures", the UWI professor said.
He insisted that it was not fair of the newly re-elected DLP administration to preach a policy of fiscal consolidation during the election campaign and then announce such a massive spending proposal.
"How is the spending going to be financed? I think politicians need to be more honest with the people", Howard said.
On Monday during the during the start of the 2013-2014 Estimates in the House of Assembly, Minister of Finance announced that the Government would be injecting over a half billion dollars into the economy.
