Kimlyn Crystal Boodram
ECON 2020 – Caribbean Economy Economic Liberalization:
(6)[c.] Identify and elaborate on the main elements of Economic Liberalization and discuss, with the use of examples and evidence, whether you think economic liberalization has been suitable and successful in the Caribbean Region.
What is Economic Liberalization?
Economic Liberalization is a very broad term that usually refers to fewer government regulations and restrictions in the economy, in exchange for greater participation of private entities. Thus, liberalisation in short, refers to "the removal of controls", to encourage economic development. Forms of Economic Liberalization:
Liberalization policies include partial or full privatisation of government institutions and assets, greater labour market flexibility, lower tax rates for businesses, less restriction on both domestic and foreign capital, open markets etc.
Positive Effects of Economic Liberalization:
Like everything else, Economic Liberalization has both positive and negative impacts on a country. I’ll briefly outline the positive impacts of what economic liberalization suppose to have towards a country, as my presentation mainly shows how economic liberalization has negatively impacted the Barbadian economy. Economic Liberalization supposedly benefits an economy by:
(1.) Removing Barriers to International Investing
(2.) Unrestricting Flow of Capital
(3.) Increasing the Stock Market Performance
(4.) Reducing Political Risks
Main Elements of Economic Liberalization:
Trade Liberalization is the removal or reduction of restrictions or barriers on the free exchange of goods between nations. The easing or eradication of these restrictions is often referred to as promoting "free trade." With specific reference to Barbados, I’ll now present:
“Trade Liberalization and the Barbados Dairy Industry”
A thesis was done which critically examined the Barbados Dairy Industry in light of the local, economic and political structure and given Trade Liberalization. As we all may know, Dairy constitutes a significant part of the local diet and income. Milk remains one of the few agricultural products in which the island claims self-sufficiency. Government reduced its role in the industry during the 1990’s structural adjustment programme and a quota system took effect. Milk production fell nearly 50% between 1992 and 1993. By the end of 2010, 16 commercial dairy farmers remained in the industry – which was less than half of the 37 registered farmers in 1990. National Milk output stood below 7 million kilograms – a half of the 14 million kilograms recorded in 1991. Was Government Policy or was the WTO-entry responsible for the declines in Milk Production and the Industry’s Consolidation? Did Government Policy lead to Trade Liberalisation, thereby increasing imports and affecting domestic production? Some of the Industry’s key stakeholders believe that increased imports associated with trade liberalization are to be blamed for the current state of affairs, which are the declining milk production and fewer farms. Evidence suggests that Trade Liberalization is exerting pressure on the Local Industry. Fresh Milk and cream imports rise more than 3% after 2000 and imports of milk products that compete with locally produced ones also exhibit signs of increase. Privatisation is primarily the process of transferring ownership of a business, enterprise, agency, public service, or public property from the public sector (a government) to the private sector, either to a business that operates for a profit or to a non-profit organization. Barbados and Privatisation
While doing research for this presentation, I came across an article from the Barbados Advocate written by M. Savory on the 18th of November 2012 entitled, “Privatization a retrograde step.” It stated, “Anyone who can think of privatizing...
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