Owen Arthur by the numbers
OWEN SEYMOUR ARTHUR became Barbados’ fifth Prime Minister on September 6th,1994 and served in that role until January 15th, 2008. Mr. Arthur was famed for his economic expertise and I hope I can do some justice to his colossal economic legacy by exploring the performance of three key macroeconomic metrics during his years as Prime Minister of Barbados, (1) growth in Real Gross Domestic Product, (2) the Unemployment Rate and (3) the Weeks of Imports Cover.
Growth In Real Gross Domestic Product (GDP) The annual growth rate in real GDP is arguably the most widely used measure of how well an economy is performing. The World Bank provides data on the growth in real GDP for Barbados from the year 1971 and figure 1 below provides an overview of the annual growth rate in real GDP, with the years of Mr. Arthur’s tenure as Prime Minister highlighted in red.
Figure 1: Barbados Real GDP Growth Rate (1966 to 2019)
Source:World Bank and Central Bank of Barbados
Mr. Arthur’s tenure as Prime Minister saw a sustained period of economic growth in Barbados. Since 1971, the Barbados’s economy has grown by approximately 56.86% (see table 1 below) and while Mr. Arthur’s term of office constituted twenty-nine percent of the time between 1971 and 2019, it accounted for almost two-thirds (62%) of the economic growth achieved over that period. Although the data is less reliable, this record of growth has only been surpassed to date by the tenure of The Right Excellent Sir Errol Walton Barrow over the 1961 to 1975 period.
Table 1. Real GDP Growth for Barbados (1966 to 2019)
However, as impressive as Mr. Arthur’s achievements were in terms of the important GDP growth variable, in some ways they pale when one examines his record in terms of unemployment and foreign exchange reserves.
Unemployment During the 1994 election campaign, Mr. Arthur campaigned on the creation of 30,000 jobs. At a time when the unemployment rate was over 20% most dismissed this campaign pledge as “election talk” and many quipped as to what Mr. Arthur was smoking. The World Bank provides unemployment data for Barbados from the year 1976, and figure 2 provides an overview of that data, with the years of Mr. Arthur’s tenure as Prime Minister highlighted in red.
Figure 2: Barbados Unemployment Rate 1976 to 2019;
Source:World Bank Over Mr. Arthur’s fourteen (14) years in office the unemployment rate fell from 24.54% in 1993 to 7.41% in 2007, a stupendous achievement and one of the best examples of honoring an election promise. Mr. Arthur’s tenure fundamentally reshaped our notions of the “natural” or “acceptable” unemployment rate in Barbados and that may be one of his enduring economic legacies.
Weeks of Import Cover
As a “Small Open Economy” committed to a fixed exchange rate, the level of foreign exchange reserves, which essentially determines our capacity to defend the fixed exchange rate, is one of the most important economic variables for Barbados. In Barbados a benchmark of twelve (12) week of import cover, has acquired semi-religious status among economists in Barbados. The World Bank provides foreign exchange reserves data for Barbados from the 1967 and figure 3 provides an overview of the annual weeks of import cover for Barbados, with the years of Mr. Arthur’s tenure as Prime Minister highlighted in red.
Figure 3: Barbados Weeks of Import Cover 1967 to 2019
Prior to Mr. Arthur assuming office as Prime Minister (1967 to 1993), the average import cover for Barbados was 7.28 weeks. However, during his term of office Barbados enjoyed an average import cover of 13.59 weeks, with imports cover peaking at 21.17 weeks in 2001, the highest ever recorded to date. Again, Mr. Arthur’s tenure fundamentally reshaped our notions of the “normal” or “acceptable” levels of foreign exchange reserves in Barbados and is another of his enduring economic legacies.
It is impossible to capture the measure of such an outstanding son of the Caribbean soil in a few numbers, but I nevertheless try and conclude with Mr. Owen Seymour Arthur in one chart.
Figure 4. Owen Arthur In One Chart