delisle worrell : coping with the economic crisis address by dr delisle worrell, governor of the central bank of barbados, to the lions club of christ church west, christ church, 8 january 2011. * * * thanks for the opportunity to address you tonight. let me commend you for the work that the lions ’ organisation has done, in this country and worldwide, to strengthen the bonds of civil society. we have grown to appreciate that voluntary organisations, religious organisations, sporting clubs, cultural clubs and other service organisations constitute an essential part of the fabric that hold civilised society together. too many of us still believe that our civic responsibility ends at the ballot box, that once we have voted we have done our duty to society, and we can get back to purely selfish pursuits. not so. the society lives and breathes through the multitude of daily interactions among all its members, and we have a responsibility to help to guide and influence these interactions, in whatever way is open to us. we must seek every possible avenue to do so, with a view to bettering our society as a whole, and to taking care of our brothers, sisters and neighbours. that is the only way for us to ensure our own happiness. the vote offers each one of us a vital tool to empower ourselves, but it is only one tool of many which are available to us. organisations such as the lions, with their international network and strong tradition of good works, are also a tool for personal empowerment. you are to be commended for the work you do, and i am sure you also derive immense personal fulfillment from your involvement with your organisation. this evening i want to talk about how individuals and small enterprises are coping with the economic crisis, as far as i can tell. i need to remind you that the barbados economy is not an abstraction ; it is thousands of us ordinary people finding ways to make ends meet, as best we can, and having to do so in very uncertain circumstances. it is a tribute to barbadian ingenuity that the country has made such notable economic strides and improvements in the quality of all our lives, with so few physical resources. barbadians are down to earth, as demonstrated by the reaction to the recent budget austerity measures. we had a sense that if the countries from which we derive our foreign exchange weren ’ t doing very well, there was no way we would avoid feeling the pinch. we have to depend on the british,

the americans, the canadians and people from our other source countries to lead us out of these woods. until they do, we must be watchful, but patient. although the signs are encouraging, we are not yet confident of recovery, so we must continue to be in a holding pattern, and make do as best we can. the impact on individuals too many jobs have been lost as a result of this recession and the unemployment rate has risen to about 11 percent of our workforce. some of those who have been laid off have found part time or informal work, with a consequent reduction in wages. however, the number of people seeking jobs, who have found nothing suitable for as long as a year or more, is now quite high. what is more, many of those still in jobs have suffered reduced hours, poor sales and reduced income. the overall result is that family incomes have typically not kept up with inflation in the past two years, and for many families earnings are substantially lower than they were before the recession. families in this situation have no option but to reduce their spending. difficult as this may be, the average barbadian household may in a better position to adjust than is the typical american household, because barbadians do not like debt. i would expect that the amount we are committed to pay to service our debt obligations of all kinds is far lower than is the case in america, as a percentage of our incomes. debt service is an obligation you cannot easily cut back on, though there is a possibility of renegotiating the terms of mortgages and bis central bankers ’ speeches other debt, if your income has been drastically reduced. on the other hand, our utility bills take up a higher portion of our income than is typical in america. in any event, we have little option but to adjust to whatever happens to our incomes. it was an airport taximan who said to me that if you ’ ve lost your job and you don ’ t know where your next month ’ s income is coming from, it makes no sense to borrow to pay your rent. so let me say something about the various ways that i have observed, in various places and at different times, that people have managed to cope with adversity of the kind we are witnessing in barbados and in most of the countries of the caribbean. one way to take advantage of a period of enforced idleness is to invest in developing your own personal skills and knowledge, through education or training. to do