Economist Jeremy Stephen has raised concerns that ongoing internal struggles within the Democratic Labour Party (DLP) could challenge the perception of Barbados as a stable democracy, with significant potential economic consequences.
Stephen made the link between political instability and investor confidence, highlighting that prolonged discord in the country’s political landscape could harm its economic prospects.
“It challenges the perception of a stable democracy,” Stephen noted, explaining that such instability “interferes with the view that investors can have secure investments in the country”.
He warned that Barbados, which heavily relies on foreign investment, may see a decrease in capital inflows if the turmoil within the DLP persists as the lack of a competitive political environment, especially one-party dominance, could erode democratic norms.
Professor Don Marshall, head of the Sir Arthur Lewis Institute of Social and Economic Studies (SALISES), shared a more nuanced perspective, suggesting that it would be stretch to indicate that Barbados is heading towards such a political reality.
Stephen’s concerns echo the experiences of other nations that faced the political and economic challenges of which he warns.
“One-party states inevitably begin to become dictatorships. History has proven that time and time again. As soon as you find one party becoming too prevalent, dictatorial moves tend to benefit a bourgeoisie,” Stephen commented, adding that foreign investors typically do not form part of this entrenched class, particularly if they are new to the economy.
This disconnect, he suggested, might dissuade sustained foreign investment.
Stephen explained that with diminishing investment, inflationary pressures could mount, exacerbating the country’s already delicate economic balance.
“Inflation happens because you can’t find competing products easily. This economic strain could lead to heightened poverty and social unrest, potentially fuelling crime and violence.”
Marshall acknowledged that leadership struggles of the DLP could cause some “skittishness among investors”.
However, he added that such issues are common in two-party systems and are not unique to Barbados.
Marshall pointed to the example of St Vincent and the Grenadines, where the Unity Labour Party has won five consecutive terms, without sparking significant investor worry.
“I don’t think investors are having sleepless nights thinking about accountability or rule of law there,” he said.
Marshall also commented on the significance of having opposition voices in Parliament, stating, “The Parliament itself is not dominated by the ruling party. In the exchanges we have seen in the House, we can say the tradition of robust debate continues.”
He added that the leadership changes within the DLP should be viewed in a broader context of party dynamics in the region, where leadership challenges are often part of the evolution of political parties.
Reflecting on the state of the DLP, Stephen said that the party needed to focus on regaining the trust of the Barbadian people and if it did not undertake serious reform, the public is unlikely to trust its leadership, which in turn would impact the broader democratic system.
“If you continue to show that you haven’t gone through your full redemption tour, then there’s no trusting you, and as such, no trust in democracy,” he remarked.
The economist also highlighted the importance of alternative political parties in such an environment.
“It’s the perfect time, in my opinion, for an alternative party to make serious inroads,” he argued, observing that competition is vital for a healthy democracy. Without viable alternatives to the DLP, he warned, Barbados risks creating a vacuum in its political landscape that could ultimately lead
to further instability.
However, Stephen pointed to Singapore as an example of how even a one-party dominant system could still succeed economically.
“What capital tends to follow is a system where everyone is held accountable, primarily ministers, senior government officials, and permanent secretaries,”
he said.
While Singapore’s government maintains strict control, its strong accountability mechanisms have allowed it to maintain investor confidence and foster economic growth. This, Stephen argued, is what Barbados must strive for if it wants to avoid the negative economic consequences of instability while maintaining democratic principles.
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