Last update: 24-Apr-2014 11:59 pm
Friday, April 25, 2014
Trinidad & Tobago Guardian Online
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Barbados pain is T&T’s nightmare
The decision by the Government of Barbados to retrench 3,000 public sector workers by the end of the first quarter of 2014 has caused almost as much shock and consternation in T&T as in Barbados, a country that has attracted billions of dollars in investment from T&T companies.
Among the local, publicly listed companies with large investments in Barbados are Neal & Massy, ANSA McAL, TCL, Republic Bank and First Citizens, while privately held companies like Associated Brands, Bermudez and the Mouttet group of companies supply food products worth millions of dollars a year to the Caricom nation.
The retrenchment of the 3,000 Barbadian workers is expected to have a chilling impact on the demand for goods and services on the island, as those affected slash their spending, restructure debt obligations, draw down on their savings and sell assets. As the retrenched Barbadian workers attempt to restructure their lives and their finances, financial institutions operating in Barbados are certain to feel the pinch.
One of those financial institutions is likely to be Republic Bank, whose single, largest shareholder is the Clico Investment Fund, which owns 40 million Republic shares. One of the options that the Government is considering to recover its $20 billion from the CL Financial bailout is to divest all of the remaining shares once held by the collapsed group.
In May, Republic Bank announced that it had acquired the remaining 34.86 per cent shareholding in the former Barbados National Bank, which became a wholly owned subsidiary of the Port-of-Spain-based bank.
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