Another View on Foreign Currency Leakages

Peter Harris Barbados Foreign Currency Leakages

I have had some positive feedback on my recent blog, in which I suggested a few Solutions to Barbados’ foreign Exchange Problem. Having only recently joined the retail business myself through Honda, I received feedback that the larger buying agencies can leak foreign currency abroad by inflating the cost of imports. Unlike cars that have rigid price controls, other consumables are left to the purchaser’s discretion for the most part to declare prices. If the purchaser is technically purchasing from himself in a foreign country then it is possible to put any price on the invoice.

If prices are artificially inflated then companies have seemingly valid reasons to send more than needed sums of money abroad. This is one area then that needs to be considered urgently if this is indeed being practiced because not only the economy suffers but the consumer as well.

Why should our consumers pay up to 500% or more for an artificially inflated item? Inflated pricing practices not only drains our foreign reserves but further inflates our already high cost of living.

I had the recent experience of looking for a 5-gallon container of a wood sealant. The local Barbados price was $375.00. The US retail price with taxes was BDS$110.00. I am sure cost of shipping, local import taxes and the retailer’s markup cannot add up to almost 300% above the US retail price.

I am not advocating price control of any type. I am merely suggesting that, in the same way that under-invoicing is policed by customs, over invoicing should also be monitored.

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Solutions to Barbados’ Foreign Exchange Problems

The Barbados economy is at an all-time low, at least based on what the rating agencies are saying.

Although Barbados still enjoys high ratings for its standard of living, Barbadians are more and more hanging their heads in shame at our country’s poor credit rating and our diminishing middle class. The general argument is that this problem has been created by our low foreign exchange earnings and our high government debt and expenditure.

The Guru’s will guide us on the debt restructuring of our local debt, that we simply have to do.

For me, however, Barbados does not have a problem with earning foreign exchange. What we have is a problem recording or collecting it into the banking system.

One of the ways that this could be improved is by allowing Barbadians to have US accounts like what is being done in other Caribbean territories. This has been suggested by many.

This would encourage more persons to keep their US dollars on the island instead of in foreign accounts.

There is a saying in Barbados that “too far East is West.” The government has tried to protect and prop up the tourism industry so much that it is not as viable as it should be especially in earning foreign exchange for the country.

The biggest single earner of foreign exchange in this country is the tourism sector, and too many tourism operations are allowed to collect their US dollars internationally and only generally bring what they need for their expenses to Barbados.

In my opinion, none of these companies should get any VAT, tax clearance or concessions unless they bank their US dollars or a minimum 90% of the US dollars that they earn into the Barbadian banking system.

This measure would solve the demand that we have for US dollars. I am NOT just targeting the hotels alone, but tour operators, villa rentals and all tourism industry actors that have booking systems that allow them to collect their revenue off shore.

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Celebrating the new home of Platinum Motors


I was delighted to officially open the new and improved headquarters of Honda Barbados and Platinum Motors in Fontabelle. Our grand opening marked the start of all of operations from this location, and I’m extremely proud to have been able to see the vision of a significantly expanded home for Platinum Motors become a reality.

Thank you to all who came out and joined us at the event, especially Ms. Vicki Poponi, Vice President Export Sales Department at American Honda, the Ambassador of Japan, His Excellency Teruhiko Shinada, the Minister of Industry, International Business, Commerce and Small Business, the Honourable Mr. Donville Inniss, as well as Honda representatives Mr. Tim Hendershot, Sales Manager Export Sales Division, and Ms. Sanae Nuimura, Japan Coordinator and Assistant to the President of Honda Motor Company.

Peter Harris In Coversation With Japanese Ambassador, His Excellency Teruhiko Shinada.

A big thank you also goes to our Platinum Motors staff who were extremely patient during the relocation. Special mention also to FirstCaribbean International Bank for making our move possible with their financial support, as well as Town and Country Planning for a seamless approvals process.

This move has meant we now have a larger showroom and adjoining parts division, new collision and repair centre, a larger mechanical workshop, improved customer access, and a new set of executive offices. Not only that, I’m also pleased to announce Platinum Motors is now selling a range of Honda motorcycles and soon will adding Honda power products and outboard engines to our list.

I am confident these upgrades to our facilities and product selection, alongside recent improvements to our human resources capacity, will firmly maintain Honda’s reputation as the most affordable mid to luxury range vehicle in Barbados.

I am committed to growing the Honda brand in Barbados to new heights and I welcome your feedback on how we can best service our valued customers in the years to come.

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Platinum Motors Inc. launches new location and the New Honda Civic

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Last week we took the media on a tour of the new home of Platinum Motors Inc. and Honda at Fontabelle.

Two years ago at the launch of Platinum Motors at Bay Street, I said that we had our sights set on moving to that Fontabelle location. At that time some thought that my vision was far fetched as this site had been abandoned by its previous owners for some time now and it was difficult for persons to see the diamond in the rough.

This location from the outset was appealing on a number of levels. It previously housed a car dealership and therefore it was already amenable to our services offering. It is central, and we also wanted to contribute to keeping our main town, Bridgetown, alive since it is currently struggling to maintain its standing as the Barbados’ main commercial hub.

We speeded up the renovations because we wanted the facility to be operational by Independence. With businesses moving out of Bridgetown we wanted our opening to be symbolic of our commitment to our main town which is important to Barbados’ heritage.

Already we are seeing investment coming back to the city as with our move here; we are soon to have influential neighbors joining us as the oil company Rubis will soon be opening a new gas station and mini mart next door. Platinum Motors’ opening can therefore be viewed as an independence gift to the city.

We have not only invested in facilities, parts and equipment, but our strategy was to simultaneously develop our human resources capacity. We now have onboard an industry savvy management team with combined experience of over 55 years in the business. We have employed additional customer service personnel and mechanical and collision repair technicians with many years of experience.

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The 2017 Honda Civic was also unveiled at the event. The new fully redesigned Honda Civic exemplifies automotive excellence and blends fun with efficiency and practicality. The Honda Civic’s precise steering, solid chassis, and well-tuned suspension provide both a compliant ride and easy handling.

Platinum Motors operation at Fontabelle features vehicular sales with larger showrooms and adjoining parts division, collision repair, a mechanical workshop and executive offices.

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Privatizing state-run organizations in Barbados

Privitizing state-owned enterprises in Barbados by Peter Harris

Privatization is inevitable. In Barbados, we simply cannot afford to continue to subsidize state-run organizations.

But how we go about privatizing our most critical public entities? In my opinion, the government should put measures in place to ensure ownership remains with the general population and not with one organization or family.

Essential services like water, transportation, sanitation, fuel, airport and seaport should not be owned by one organization or family for generations to come at the expense of the populace. What should happen is that there should be a tender for a management contract for a private enterprise to run these institutions. The contractor should be allowed to purchase up to a maximum of 10%-35% of the state own enterprise but the rest of the enterprise being offered to the public so that there is public participation in these entities.

There is a debate on now about the privatization of the Sanitation Service Authority. Why would we want to end up putting the collection of garbage into the hands of one family, irrespective of who is it? We have already done part of this on the water side, and in my opinion, this should not have happened. Barbadians have a lot of savings in banks, and we effectively have been paying taxes to build these state enterprises so why not offer the same taxpayers the opportunity to own a stake in what they have effectively contributed to over the years.

Let us not be blindsided by the present, especially in this our 50th year of Independence, but be cognizant of the Barbados we are creating for generations to come.

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