RESTRICTED  
  
WT/TPR/G/ 431 
20 September 2022  
(22-6816) Page: 1/12 
Trade Policy Review Body   Original: English  
 
TRADE POLICY REVIEW  
REPORT BY  
BARBADOS  
Pursuant to the Agreement Establishing the Trade Policy Review Mechanism (Annex 3 of the 
Marrakesh Agreement Establishing the World Trade Organization), the policy statement by Barbados  
is attached.  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Note: This report is subject to restricted circulation and press embargo until the end of the 
first session of the meeting of the Trade Policy Review Body on Barbados . WT/TPR/G/431 • Barbados  
 
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  Contents  
1   INTRODUCTION  ................................ ................................ ................................ .........  3 
1.1   Challenges  ................................ ................................ ................................ .................  3 
2   TRADING ARRANGEMENTS  ................................ ................................ .........................  5 
2.1   CARICOM Bilateral  ................................ ................................ ................................ ...... 5 
2.2   CARIFORUM European Union Economic Partnership Agreement  ................................ ........  5 
2.3   CARIFORUM United Kingdom Economic Partnership Agreement  ................................ ........  6 
2.4   CARICOM  ................................ ................................ ................................ ..................  6 
2.5   Caribbean Basin Initiative (CBI)  ................................ ................................ ...................  6 
2.6   CARIBCAN  ................................ ................................ ................................ .................  7 
3   SECTORAL PERFORMANCE  ................................ ................................ ..........................  7 
3.1   Agriculture  ................................ ................................ ................................ .................  7 
3.1.1    Major challenges  ................................ ................................ ................................ ...... 8 
3.1.2    Major initiatives undertaken and planned  ................................ ................................ .... 8 
3.1.3    Major legislative and regulatory changes  ................................ ................................ .... 9 
3.2   Manufacturing  ................................ ................................ ................................ ............  9 
3.3   Services ................................ ................................ ................................ ..................  10 
3.3.1    Overview  ................................ ................................ ................................ ..............  10 
3.3.2    Tourism  ................................ ................................ ................................ ................  10 
3.3.3    International business  ................................ ................................ ............................  10 
4   THE WAY FORWARD  ................................ ................................ ................................ . 11 
 
 
  WT/TPR/G/431 • Barbados  
 
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  1  INTRODUCTION  
1.1.  Since its last Trade Policy Review in 2014, Barbados sought to continue building on its growth 
and development path, despite the numerous challenges it would have faced since the 2008 financial 
crisis. Notwithstanding efforts by the Government to bring about sustained growth to the economy 
post 2014, the economy grew marginally during thi s period and beyond. This stagnant growth 
resulted in difficulties in expanding the economy and maintaining the level of employment in both 
the public and private sector.  
1.2.  Additionally, the economy was ravaged by the onset of the global pandemic, the volcan ic 
eruption of La Soufri ere volcano in St. Vincent and the Grenadines and two climatic events in 2021. 
These additional stresses on the economy served to further reduce economic growth and increase 
debt. 
1.3.  Notwithstanding these shocks, Barbados did not erect  any barriers to trade as a means of trade 
protection. As a small open economy, Barbados is aware that its growth and development is 
dependent on remaining open in the global community. Hence, international trade is the main 
avenue for countering the slugg ishness in the economy.  
1.4.  Barbados also continues to pin much of its hopes for economic revival and sustainability on its 
regional trade, namely within the CARICOM Single Market and Economy as well as with bilateral 
partners. Much of Barbados ' exports are t o trading partners within the region. CARICOM therefore 
remains an important market for its goods and services. Its bilateral partners, Venezuela, Colombia, 
Dominican  Republic , Cuba and Costa Rica – though trading with these countries is much less than 
was initially envisioned – are still significant trading partners. Barbados, with fellow CARICOM 
Member States, is trying to create and maintain opportunities for increased trade through its bilateral 
negotiations.  
1.5.  The Economic Partnership Agreements (EPA) is  also an important agreement and one in which 
Barbados is earnestly trying to boost its trade. The United Kingdom, when formerly part of the 
European Union (EU), was Barbados ' main export market in the EU. Given its separation from the 
EU, Barbados is stri dently seeking to maintain its export numbers to that market.  
1.6.  Notwithstanding the UK 's separation from the EU, Barbados will nevertheless be seeking to 
improve its export trade to the EU as it seeks to diversify into new markets and expand its trade 
into m arkets in which it had a presence previously.  
1.7.  Barbados is also seeking to enter new markets on the African continent for the export of its 
goods and services and will also be seeking to improve trade relations with Middle Eastern countries 
through new, or  amendments to, bilateral investment treaties or double taxation agreements.   
1.1  Challenges  
1.8.  Since the last Trade Policy Review, a number of critical economic issues would have been 
experienced. Many of these issues would have arisen from the 2008 financial a nd economic crisis 
and would have continued post 2014.  
1.9.  The 2008 crisis, which would have seen the collapse of large global conglomerates, the loss in 
value of stocks and bonds and reduced growth in many developed and emerging markets, did not 
leave Barbado s unscathed. Indeed, during the 2014 period and beyond, Barbados experienced 
continued contraction of the economy and reductions in private capital inflows.  
1.10.   Additionally, Barbados, in 2020, was unilaterally blacklisted by the European Union after being 
listed as partially compliant by the Organisation for Economic Cooperation and Development (OECD) 
global forum with regards to certain regulations. Prompt action by the authorities was required on a 
number of occasions to avert negative fall -out from such ac tions.  
1.11.   Post 2014 and prior to the 2018 period, Barbados ' continued experience of sluggish economic 
activity was in part caused by a number of incidents occurring in tandem. One of the main issues 
which impacted heavily on the Barbados economy around the 2 016-2017 period was a lack of 
investor confidence. Barbados experienced a series of credit rating downgrades which saw its rating WT/TPR/G/431 • Barbados  
 
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  for foreign debt slip from investment grade on the eve of the global financial crisis to selective default 
in June 2018. This was the first time Barbados would have defaulted on its debt payments. This 
situation has been successfully reversed and Barbados maintains a positive and encouraging investor 
rating by various agencies.  
1.12.   The expanding public debt was also proving problemat ic for the technocrats managing the 
economy. The Barbados Economic and Social Report of 2018 indicated that as of 24  May 2018, 
Barbados was faced with a public debt in the region of 158% of Gross Domestic Product (GDP). 
During this period, the domestic debt stood at approximately 80% of GDP whilst foreign debt stood 
at 20%.  
1.13.   During this period, it was also faced with mountin g debt service payments of US D 50 million 
which were becoming due in the month of June 2018, along with annual interest costs of 
USD 400 million.  
1.14.   The Barbados Economic and Social Report indicated that at the end of 2017, Barbados ' foreign 
reserves stood at  BBD 400 million  which is representative of only 5 weeks import cover.  
1.15.   During this period, the Government had resorted to the printing of money, with a heavy 
dependence on the Central Bank of Barbados, given shortfalls in meeting salaries of public servant s. 
This naturally placed strain on the foreign reserves and the parity of the Barbados dollar.  
1.16.   In order to create some degree of leverage within the economy, steps had to be taken to 
arrest the dwindling foreign reserves, inspire confidence with regard to  both external and local 
creditors and significantly reduce the debt to GDP ratio in the shortest possible time. These actions 
culminated in Barbados ' labour market also witnessing severe dislocation as double -digit 
unemployment was experienced.  
1.17.   These crit ical steps were taken in 2018 with the advent of a new political administration. The 
Barbados Labour Party (BLP) succeeded the Democratic Labour Party (DLP) at the polls in May 2018.  
1.18.   During this period a restructuring of the economy commenced. This restruc turing was at the 
heart of Government 's medium term strategic plan which was called the Barbados Economy 
Recovery and Transformation (BERT) Plan.  
1.19.   The success of the BERT Plan and to a great degree, the restructuring programme, was 
evident in the 2018-2019 period, when the public sector debt fell to 125% of GDP. During this period, 
foreign reserves also rose to B BD 1 billion , signifying 12.8 weeks import cover. The instituting of 
this Plan also meant that Barbados was now capable of borrowing from other financial institutions 
such as the Caribbean Development Bank (CDB), the World Bank, among others. During the 
2018-2019 period, the Economic and Social Report indicated that Barbados was able to borrow 
USD 75 million and US D 100 million from the Cari bbean Development Bank and the Inter -American 
Development Bank respectively.  
1.20.   Notwithstanding the positive developments in the economy which occurred from the 2018 
period onward, Barbados ' economy experienced set -backs due to the Coronavirus pandemic of ear ly 
2020 and the ash fall from the La Soufriere in St. Vincent in April 2021. The climatic events of 2021 
also created unforeseen levels of damage to housing solutions.  
1.21.   The Coronavirus pandemic (COVID -19) has adversely affected almost all economies globally . 
Barbados has not been spared the onslaught of this virus. From the 2020 period onward, Barbados 
experienced two (2) major lockdowns, which adversely affected the economic outlook of various 
business sectors. Barbados ' tourism experienced severe dislocati on as many international and 
regional flights temporarily ceased operations to the country. As a result of the economic fallout 
from the virus during this period, over 41,000 unemployment benefit applications were filed in 
May 2020. This represented almost  one-third of the workforce.  
1.22.   In order to mitigate much of the dislocation which took place in the economy leading to public 
and private sector retrenchment, the Government implemented the Barbados Optional Saving 
Scheme (BOSS). This saving scheme was repr esented by a four (4) year saving bond which offered 
an interest rate of 5% per annum. The main purpose of this programme was to aid in Government's WT/TPR/G/431 • Barbados  
 
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  financing of its capital works programme, thereby allowing for the creation of employment and the 
accelerat ion of economic growth.  
2  TRADING ARRANGEMENTS  
2.1  CARICOM Bilateral  
2.1.  Barbados has signed five (5) bilateral agreements with countries of this hemisphere under the 
rubric of CARICOM. The first agreement signed by CARICOM was with Venezuela in 1992. This 
agreement, the CARICOM Trade and Investment Agreement, is a one -way trade agreement in 
CARICOM 's favour. The second Agreement, the CARICOM Colombia Trade, Economic and Technical 
Cooperation Agreement was signed as a one -way Agreement in 1994 and amended to  allow for 
reciprocal trade in 1998. The third agreement signed by CARICOM was the CARICOM Dominican 
Republic Free Trade Agreement which was signed in 1998. CARICOM signed the CARICOM Trade and 
Economic Cooperation Agreement with Cuba in 2000 and the final  Agreement signed was the 
CARICOM Costa Rica Free Trade Agreement which was signed in 2004.  
2.2.  Barbados ratified these Agreements in April 2006 and with CARICOM Members has sought to 
further the liberali zation process under some of the Agreements.  
2.3.  Further l iberali zation is slated to take place under the CARICOM Cuba Agreement based on a 
series of negotiations which occurred between CARICOM and Cuba in September -October 2014 and 
a final meeting in October 2015. These meetings led to the signing of a second Protocol on 
10 November 2017. The Protocol is yet to be ratified by Barbados.  
2.4.  Negotiations also took place with Costa Rica in 2015 and the Dominican Republic in 2017. 
These negotiations, however, did not lead to further liberalisation.  
2.5.  CARICOM recently enter ed into negotiations with Colombia during May -June 2022. These 
negotiations will explore the possibility of further liberalisation under this Agreement.  
2.6.  Since the signing of the Agreement between CARICOM and Venezuela, no discussions have 
taken place to e nact a reciprocal agreement allowing for further liberalisation.  
2.7.  Trade under these agreements has not been as vibrant as was expected by the Parties involved. 
Certainly, in Barbados ' case, its export trade has not been significant under any of the Agreeme nts. 
The import trade, however, has been more active under some of the Agreements. Most Favoured 
Nation (MFN) trade has also been significant with regard to imports from these Spanish speaking 
nations.  
2.2  CARIFORUM European Union Economic Partnership Agreeme nt  
2.8.  Barbados and CARIFORUM countries entered negotiations with the 27 members of the 
European Union (EU) in 2000 allowing for a new reciprocal trade agreement which replaced the trade 
provisions of the Cotonou Agreement. This new Agreement, the CARIFORUM E U EPA, was signed in 
October 2008.  
2.9.  During this period, the EPA has undergone one (1) review and is in the process of undergoing 
the second review. The first review occurred in 2015. These five (5) year reviews, among other 
things, indicate the performance  of the CARIFORUM states under the Agreement.  
2.10.   The first review indicated that most CARIFORUM States had performed poorly in their trade 
with the EU due to the financial and economic crisis of 2008. The report indicated that the economic 
crisis negatively affected the Gross Domestic Product, trade and other socio -economic factors and 
hence impacted on the implementation of EPA related reforms. CARIFORUM states hence did not 
have the resources to increase their capacity to take advantage of the opportunities  present.  WT/TPR/G/431 • Barbados  
 
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  2.11.   With respect to trade in goods the report stated that some of the challenges affecting the 
private sector were:  
• Limited resources to finance innovation as well as research and development which 
exacerbates the supply side constraints;  
• Difficulty meeting SPS measures and dealing with technical regulations;  
• Inadequate access to affordable transportation and energy; and  
• Lack of an appropriate regulatory and enabling environment to facilitate trade.  
2.12.   Barbados ' performance was no different from many of  its CARIFORUM partners under the 
CARIFORUM – European Union (EU) Economic Partnership Agreement (EPA). That is, its performance 
during the 2008 period onward was in no way a stellar performance and this is especially so with 
regards to its export performa nce. 
2.13.   The second 5 -year review is presently being undertaken by the EU and CARIFORUM.  
2.3  CARIFORUM United Kingdom Economic Partnership Agreement  
2.14.   Barbados signed the CARIFORUM -United Kingdom (UK) Agreement on 22  March  2019. The 
Agreement was ratified in the House of Assembly and the Senate in November and December 2019 
respectively. The Agreement was gazette in December 2019.  
2.15.   The Parties held their first meeting of the Trade and Development Committee on 
7 October  2021.  The first meeting of the Joint Council is slated to occur on 5  November  2021.  
2.16.   The UK continues to be Barbados ' main source market for tourism related travel. Prior to the 
COVID -19 pandemic, Barbados recorded a total of 220,695 and 234,659 tourist arrival s from the UK 
in 2018 and 2019 , respectively. This number, however, decreased significantly during 2020 and 
2021 to 64,456 and 58,426 respectively. These drastic reductions have been attributed to reduced 
airlift and the apprehension of most individuals wi th regard to traveling during the period of the 
pandemic.  
2.17.   From late 2021, tourism arrival from the United Kingdom have begun to increase steadily.  
2.4  CARICOM  
2.18.   Barbados has been a part of the CARICOM Single Market and Economy (CSME) since its 
signature in 200 1. 
2.19.   To date, Barbados and the Region are seeking changes to the Common External Tariff (CET) 
and Rules of Origin (ROO) in order that these measures would allow for a more competitive region 
and also to further the integration process. Negotiations in these areas are still ongoing.  
2.20.   Negotiations have also occurred with regard to the development of a protocol on Government 
Procurement for the Caribbean Community. This protocol was signed by Barbados in February 2019 
and ratified in August 2019. The Protocol wil l allow Member States the opportunity to procure goods 
and services from other Member States once the cost of procuring these goods and services fall 
within a stated threshold.  
2.21.   Barbados also continues to seek further progress on the free movement of peopl e under the 
CARICOM Single Market and has drafted legislation on the free movement of a further three 
categories of persons. These are security guards, domestics and agricultural workers.  
2.22.   It must be stated that Barbados is the only CARICOM country which h as drafted legislation 
and has prescribed definitions related to these three categories.  
2.5  Caribbean Basin Initiative (CBI)  
2.23.   Barbados places a high value on the Caribbean Basin Initiative (CBI) programme enacted by 
the United  States . The programme enables Ba rbados to increase its exports and bolster foreign WT/TPR/G/431 • Barbados  
 
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  export earnings. These factors all contribute to achieving set economic growth and development 
targets.  
2.24.   An examination of the trade performance of Barbados with the U .S. highlights the vital role 
the prog ramme plays in boosting domestic exports and the need for its continuation. The U .S. is 
presently Barbados ' top export destination and an average of approximately 60% of Barbados ' 
exports to the U .S. enter under the preferential programme. The duty -free st atus accorded to some 
of Barbados ' products increases Barbados ' ability to compete on the U .S. market. This is significant 
given the small size of the Barbadian market and economy and the inherent difficulties in achieving 
economies of scale.  
2.25.   No less impo rtant to national goals is the maintenance of linkages to the Barbadian diaspora 
which is assisted through the provision of traditional products at an economical price. Among such 
products are rum, jam, jellies, sauces, seasonings and sweetened and unsweet ened biscuits.  
2.6  CARIBCAN  
2.26.   Barbados, along with the other CARICOM Member States, was engaged in negotiations with 
Canada for a Trade and Development Agreement from 2007. After approximately eight (8) years of 
negotiating, the Parties were still unable to fas hion a reciprocal agreement to replace the CARIBCAN 
Agreement. The two sides were unable to come to a place of mutual understanding especially in the 
areas of goods, services and to a lesser extent investment. Both Parties suspended negotiations in 
May 201 5. 
2.27.   A waiver must be sought among the membership allowing for trade between the beneficiaries 
of the Agreement and Canada to continue. Canada submitted a waiver to the Council for Trade in 
Goods (CTG) of the WTO for renewal of the CARIBCAN agreement. The cu rrent waiver expires on 
31 December 2023. Barbados is thus eligible to continue exporting certain goods to Canada free of 
duty and would not have to face the Most Favoured Nation (MFN) tariff which is that tariff applied 
by Canada to all goods entering its  borders from other WTO countries with whom they do not have 
a preferential trading agreement.  
2.28.   Barbados is no longer eligible to access Canada 's General Preferential Tariff (GPT) which is a 
non-reciprocal preferential arrangement offered by Canada to impo rts from developing countries. 
Due to Canada 's graduation criteria, Barbados was no longer entitled to the benefits of the GPT after 
31 December  2014.  
2.29.   Goods which currently benefit from preference when exported from Barbados into Canada 
include Rum, both bulk and bottled, sweet biscuits, aerated beverages, synthetic sails and sauces.  
3  SECTORAL PERFORMANCE  
3.1  Agriculture  
3.1.  The agriculture sector of continues to be a sector of critical importance to Barbados, both as a 
source of food and nutrition security as well as a source of employment for many households in the 
country. However, the sector still faces many longstanding challenges such as praedial larceny, 
competition for resources and limited land space and an aging demographic. The current COV ID-19 
pandemic also provided both challenges and opportunities for the sector.  
3.2.  Additionally, the sector faces competition in the face of a rising food bill which has been at 
historically high levels in the period subsequent to the last trade review. This f ood bill stood at close 
to US D 350 million for several years. This is further compounded by the comparatively higher costs 
of local production as virtually all agricultural inputs are sourced outside of the country. 
Notwithstanding this, there are some agr icultural sectors such as poultry and root crop production 
where local supply has kept pace with domestic demand,  WT/TPR/G/431 • Barbados  
 
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  3.1.1   Major challenges  
3.3.  Since the last Trade Policy Review a number of major challenges would have arisen which 
significantly impacted on Barbados and by extension the agricultural sector. These are as follows:  
• Drought Conditions  – During the period 2014 to 2019 and for part of 2020, Barbados and 
the wider Caribbean were impacted by the El Niño effect which resulted in lower than normal 
levels of rainfall. This was most pronounced in the years 2016/17 where, using 2014 as a 
baseline, overall crop production levels fell by 4 % during these years. After 2018, however, 
crop production levels saw marked improvements. On the other hand, while lives tock 
production levels remained constant or increased during the period, this was mainly due to 
increased production of poultry with some industries such as dairy showing lower levels of 
production.  
3.1.2   Major initiatives undertaken and planned  
3.4.  There are a numb er of initiatives which have either been implemented or are set to be 
undertaken by the Ministry with an aim at either establishing new industries or improving upon 
existing ones. These are as follows:  
• FEED Programme - The Farmers ' Empowerment and Enfranch isement Drive (FEED) 
programme is an initiative of the Ministry which is administered by the State -Owned 
Enterprise (SOE) Barbados Agricultural Development and Marketing Corporation. This 
programme is broadly aimed at increasing agricultural production in Barbados and providing 
a source of employment and financial security and stability to participants and their families. 
The programme also seeks to facilitate the entry of farmers and other agricultural 
entrepreneurs who may otherwise not be in a position t o enter the sector. Key target 
demographics of the programme included young persons, women and persons who were 
unemployed. The programme includes training, access to agricultural land and the 
assistance of the BADMC in obtaining market access. The overall  aim of the programme is 
to see 3,000 new successful entrants into the sector in various ventures including traditional 
crop and livestock agriculture, budding sectors such as the apiculture and the medicinal 
cannabis industry. The COVID -19 pandemic would have impacted on the ability of the 
BADMC and the Ministry to maintain the planned timeline for the rollout of the initiative. 
Nonetheless, to date 552 persons, 375 males and 176 females have completed training 
under 3 cycles of the training programme ; 
 
• Restructuring of the Sugar Industry  – Sugarcane  is the largest single cultivated crop in 
Barbados and the industry is managed by the SOE Barbados Agricultural Management 
Company (BAMC). The BAMC  is responsible for the processing and sale of sugar through 
cultivation on crown land and the purchase of sugar cane from private farmers at a fixed 
price. Decreasing yields and falling prices have however made this an untenable situation. 
Plans are howev er underway to privatize the industry with Government retaining only a 
limited stake in the sector. It is proposed that this will be achieved by transitioning the 
industry from one simply based on the production of bulk sugar for export into an industry 
focused on value added production including increased production of direct consumption 
sugar for both the domestic and export markets, increasing supply of the molasses to the 
rum industry and the generation of renewable energy from biomass among other plans . It 
is envisaged that the transitioning of the industry to be private sector led will be concluded 
by 2025 ; 
 
• Development of the Black -belly Sheep Industry – The Barbados Black -belly sheep is a 
specialized breed which has been developed through selective b reeding techniques. 
However, the industry is still comparatively small when compared to other livestock 
industries such as pig and poultry. As such, development and establishment of a profitable 
and sustainable value -added  industry is a major priority for the Ministry. It is envisioned 
that the industry will be developed around the entirety of the animal from meat and specialty 
cuts to leather products derived from the skin.  WT/TPR/G/431 • Barbados  
 
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  3.1.3   Major legislative and regulatory changes  
3.5.  The following major legislation came into effect subsequent to Barbados ' last trade Review in 
2014:  
i. Plant Protection Act, Cap 268 ; 
ii. Animals (Diseases and Importation) (Amendment) Act 2014 -10; 
iii. Animals (Diseases and Importation) (Amendment) Regulations 2014 -10; 
iv. Pesticides Control (Amendment) Bill 202 0; 
v. Markets and Slaughter -Houses (Amendment) Bill, Cap 265 . 
3.6.  In addition to the aforementioned legislation, the following proposed bills are in the stage of 
drafting:  
i. Animal Health and Veterinary Public Health Bill, 2021 ; 
ii. Food Safety and quality Bill, 2021; 
iii. Plant Protection Bill, 2021 . 
3.2  Manufacturing  
3.7.  During the period under review, the Government of Barbados was active in the amendment 
and repealing of certain pieces of legislation which were deemed non -compliant with Barbados ' 
commitments under the Worl d Trade Organization. In this regard, the Parliament repealed the Fiscal 
Incentives Act, Cap 71 (a) as it contained provisions relating to prohibited Export subsidies and 
provisions on local content requirement which ran counter to the country 's obligation s as contained 
within the World Trade Organization Agreement. This Act was repealed in 2019.  
3.8.  Since the repeal of the Fiscal Incentives Act, the Ministry responsible for Industry, the Ministry 
of International Business and Industry, has been working towards  the development of a new 
legislative policy to govern the industrial sector. This Act should have been enacted during the year 
2021. This new policy has not yet been enacted but is currently being given the utmost attention in 
the current Ministry, the Mi nistry of Industry, Innovation, Science and Technology.  
3.9.  This updated policy is necessary given the slow but consistent decline in the growth of the 
manufacturing sector and its attendant contribution to the Gross Domestic Product (GDP), as well 
as the fact  that due to the repeal of the Fiscal Incentive Act, there was no longer any legislative 
guide for the manufacturing sector.  
3.10.   Consequently, as a starting point, a consultancy was undertaken by the late former  Prime  
Minister,  Professor  the Right Honorable  Owen Arthur  on the sector  to determine  the reasons  for the 
decline  and how such a decline  could  be halted.  The Report  made  the following  recommendations  to 
address  the factors  which  have impeded  the growth  of the sector.  
(1) The need for incentives  to re-energize  the sector ; 
(2) The need for new opportunities  through  which  companies  could  scale up and export ; 
(3) The need for finance ; 
(4) The need to reduce  or better  manage  the costs of production ; 
(5) Increased  capacity  to export  and actively  address  issues  in external  markets . 
3.11.   Some of the key challenges cited in the sector are as follows:  
• COVID -19 Pandemic ;  
• High production  costs; 
• A relatively  small  bank of exportable  products ; 
• Reluctance  by some  key local producers  to explore  
non-traditional  markets .  
• Capacity  constraints ;  
• Language  barriers  in non-traditional  markets ; 
• Lack of timely  and adequate  transportation  to markets ;  
• High costs of promoting  individual  brands/products ;  
• Lack of highly  effective  distribution  networks/distribution .  
• Challenges  with obtaining  and maintaining  retail space . WT/TPR/G/431 • Barbados  
 
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  3.3  Services  
3.3.1   Overview  
3.12.   The services sector continues to play a major role in the economic and social development of 
Barbados. Within the services sector, tourism and the provision of international business and 
financial services are major contributors to foreign exchange earnings and are significant sources of 
employment.  
3.13.   The significant and adverse effects of the COVID -19 pandemic produced an unprecedented 
global response  characterized by national lockdowns and global travel restrictions. The result of such 
measures was devastating to the tourism industry in general and acutely felt by small vulnerable 
economies. Government interventions and novel initiatives were required  to support the local sector. 
Within the same period, significant adjustments were made to the national regime for international 
business in line with international rulemaking.  
3.3.2   Tourism  
3.14.   In 2019, tourism contributed 17.5 % to GDP with an estimated contributi on of 
BBD 1,409.9  million to the economy. Direct employment was measured at 15,600 and indirect 
employment estimated at 45,000. With the advent of the COVID -19 pandemic, the average 
contribution from tourism to GDP for 2020 was 6.2 % and fell to 2.8 % at the  end of the year 2021. 
It is estimated that tourism contributed B BD 413.2 million to the economy in 2020, a decrease of 
71%. Employment recorded for the fourth quarter of 2020 showed that there were 10,600  persons 
employed in the industry.  
3.15.   Long-stay visit or arrivals to Barbados were registered at 195,102 by the end of 2020, 
compared to 2019 when arrivals totalled  692,658, a decline of just under half of a million visitors 
(70.9% decline). Hotel occupancy rates were recorded at 36.6% at the end of 2020 comp ared to 
69% a year earlier. The cruise industry was also particularly hard hit. The cruise industry which had 
recorded 686,813 arrivals in 2019 saw cruise arrivals plummet to 250,542 arrivals at the end of 
2020 (a 63.5% decline) and 71,593 arrivals in 2021 . Visitor expenditure suffered a significant blow 
and fell to BBD 1.2 billion in 2020 from BBD 2.5 billion in 2019.  
3.16.   The Government of Barbados employed several measures to mitigate the impact of the 
COVID -19 pandemic on the industry. Through the Barbados E mployment and Sustainable 
Transformation (BEST) Plan, the Government of Barbados pledged B BD 300 million to invest in 
qualified companies through grants and preference shares to fund the training and re -engagement 
of workers, to implement technologies that  bring about greater efficiencies and to enable companies 
to survive. Under the National Training Initiative (NTI), efforts were made to skill, upskill and reskill 
the direct and indirect tourism and hospitality frontline workforce, during the closure of t he industry 
to meet the demands of a transformed sector for the reopening of the tourism industry.  
3.17.   The tourism industry is recognized as vital to the economic socio -economic development of 
Barbados. For the expansion and growth of the industry post -COVID, new initiatives and proposed 
measures to grow and sustain the tourism industry are proposed. They include the pursuit of digitally 
based marketing initiatives, the creation of a virtual tourism programme and the development of a 
competitive marketing strat egy. 
3.3.3   International business  
3.18.   The competitiveness of the Barbados international business and financial services sector is 
hinged on the commitment to high regulatory standards and the integrity of the sector. By the end 
of 2018, entities under the Internatio nal Business Companies (IBC) Act Cap 77 and entities under 
the provisions of Societies with Restricted Liability (ISRL) Act Cap. 318B relative to International 
Societies were abolished following a review by the OECD 's Forum on Harmful Tax Practices. The 
review indicated cases of potential harm due to ring -fencing and a l ack of substantial activities .  
3.19.   In 2018, Barbados signed the Multilateral Convention to Implement Tax Treaty Related 
Measures to Prevent Base Erosion and Profit Shifting (MLI) and it came into force in 2021. The MLI WT/TPR/G/431 • Barbados  
 
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  allows governments to implement minimum standards to counter treaty abus e and impose dispute 
resolution mechanisms while providing flexibility to accommodate specific tax treaty policies.  
3.20.   During 2021, amendments were made to the Companies (Economic Substance) Act 2019 -43 
and to the International Business Unit Anti -Money Launde ring/Combatting the Financing of Terrorism 
and Proliferations Guideline.  
3.21.   Double Taxation Treaties (DTAs), Tax Information Exchange Agreements (TEIAs) and Bilateral 
Investment Treaties (BITs) are recognized as important instruments to enhance Barbados ' position 
as a global business centre to attract businesses of substance. While no new BITs and TIEAs have 
been signed since 2015, four (4) new DTAs have come into force. Barbados currently has 11 BITS, 
31 DTAs and 4 TIEAs in force.  
4  THE WAY FORWARD  
4.1.  Barbados, as a small open economy, is well aware that trade and investment are vital aspects 
of its economic development. It is also well aware that an environment which allows for an easy flow 
of goods, services and investment is necessary to allow for the unencumb ered movement of goods, 
services and investment. Government is seeking to take a proactive lead in reducing the number of 
encumbrances to doing business in Barbados.  
4.2.  The Government of Barbados has therefore embarked on a number of initiatives to provide t he 
appropriate facilitation and environment for entrepreneurs in Barbados to do better business. These 
initiatives are directed towards innovation, information, communication and smart technologies; 
insolvency legislation and development of the cooperative s movement.  
4.3.  Government is also seeking to transform itself as it moves towards eradicating inefficient, 
outdated processes and collapsing unnecessary bureaucratic layers that make it difficult not only for 
new local entrepreneurs to be able to function but  also foreign investors.  
4.4.  Additionally, with the advent of the TFA, Barbados has sought to improve the procedures 
governing the movement of goods, ultimately leading to a simplification and harmoni zation of the 
regulatory interface between government bodie s and traders at the national borders. Such trade 
reforms have the potential to reduce institutional, structural, and procedural inefficiencies while 
enhancing opportunities for increased trade.  
4.5.  Customs and Excise department in collaboration with key agen cies have been working towards 
the piloting of several initiatives including the launch of a trusted trader program me (authori zed 
economic operator program me) and the implementation of pre -arrival processing procedures to 
expedite the clearance of goods. A dditionally, the Government of Barbados has been benefiting from 
assistance the International Monetary Fund (IMF) to improve the revenue mobili zation and 
operational efficiency of the Customs and Excise Department.  
4.6.  During the 15th UNCTAD Conference held in  Barbados in October 2021, the Government of 
Barbados and United Nations Conference for Trade and Economic Development signed a project 
agreement to implement a National Electronic Single Window. The comprehensive project will reform 
Barbados ' regulatory t rading regime by transitioning 28 government agencies to an electronic 
paperless processing environment, while satisfying all cross -border and regulatory requirements  for 
trade with the technical support from UNCTAD.  
4.7.  The Electronic Single Window (ESW) for trade is one of the many innovative measures in the 
harmonization and facilitation of international trade and is recogni zed as an important step forward 
in adopting recommended best practices and creating transparency while expediting procedures to 
facilitate trade. The proposed single window solution will allow stakeholders to interact and satisfy 
formalities in an electronic paperless processing environment, where all cross -border and regulatory 
requirements can be fulfilled. UNCTAD proposed single wi ndow solution will permit:  
• Single entry point – ESW Portal ; 
• Single submission of data ; 
• Single and synchronous processing of data ; 
• Single decision -making point for clearance ; 
• Single payment . WT/TPR/G/431 • Barbados  
 
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  4.8.  As Barbados continues its journey as a Republic, the Government is committed to securing an 
equitable and fair future for all, where innovation and embracing technology will remain critical 
planks. A stronger focus on continued reforms and digitization tra nsformation currently in train will 
be pursued. Barbados intends to leverage technology to transform Barbados into a Smart Nation 
and a full -fledged innovative economy. The protection of the environment is important to achieving 
growth.  
4.9.  Barbados continues  to prepare for a post -COVID future. This includes the building of strategic 
relationships with likeminded persons, organi zations and countries. The Government will continue 
to craft new and relevant strategies for development, to protect our environment a nd build resilience 
so that no matter the nature of the challenges confronting us, we shall ensure a fair share for all of 
our citizens.  
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