Barbados aims to become a developed nation by 2025, and the Government of Barbados is currently focusing on a number of sectors in which national performance should be enhanced in order to assist in achieving this status. The environment is one such sector.
Contrary to the situation in Canada and other developed nations that have private sector driven economies, the economy of Barbados is led by the public sector. Government therefore plays a very active role in business. It is the driving force of all legislation and public policy related to the environment and spearheads most of the major initiatives in this sector. The government is represented by the Ministry of Energy and the Environment and a number of agencies that fall under the aegis of this ministry:
- Coastal Zone Management Unit;
- Environmental Protection Deparent;
- National Conservation Commission;
- Natural Heritage Deparent.
Each of these agencies has its own areas of responsibility and expertise. Along with the Ministry, they address the full gamut of issues that arise within the environment sector. Also playing a critical role in the sector is the Solid Waste Project Unit, which falls under the purview of the Ministry of Health. This office often collaborates with the various environment authorities on important issues but bears primary responsibility for the management of solid waste on the island.
Quantitative trade-related data relating to this sector were difficult to obtain in the past. The Ministry recently conducted a study (currently under review) that indicates that in 2006 Barbados imported environmental goods valued at $256,263,194. These imports would likely have come about as a result of both public and private demand. It is important to note that the government commits and spends a significant amount of money on environmental goods and services every year. The total amount committed and spent varies from year to year, contingent on the projects being executed.
For example, in the 2007-2008 fiscal year, $12 million was allocated for the Solid Waste Project Unit alone, and it is expected that the majority of this money will be spent on subcomponents of a project that seeks to establish facilities for the transport and disposal of solid waste. The other agencies have been granted different sums for the execution of their projects. Additional funding for environmental projects is provided by the multilateral development banks active in the region.
A few private companies are also engaged in environmental work. These tend to focus more heavily on recycling various materials than on any other environmental activity. Blazing the trail in the private sector are the hotels. The hotel sector has made strides in instituting environmentally friendly practices. Although not all hotels have gone in this direction, a number have taken environmental matters seriously enough to pursue and successfully obtain Green Globe certification.
With regard to the expertise required for environmental projects executed locally, Canada is known on the island as a world leader, despite competition from the U.S. and the U.K. Canadian companies have enjoyed a good reputation within the environmental sector and have also benefited from a high rate of success on contracts funded by the Caribbean Development Bank. As a result, a number of Canadian companies have worked and continue to work on the island, and interest in Canadian environmental solutions has remained solid over the years.
Canadian companies working in the environment sector tend to be more successful in projects for which technical assistance is required, and it is this level of Canadian expertise that is best known. In some instances, such as in the case of Stantec Consulting International, successful companies have set up business on the island and continue to work throughout the region. Before being bought by General Electric, Zenon had also opened an office in Barbados.
Companies that have worked or are working in Barbados include Reid Crowthers, Axys Environmental Consulting Ltd., R.J. Burnside International Ltd., Biothermica Technologies Inc., Dillon Consulting, W.S. Baird & Associates Coastal Engineers Ltd. and Clean Harbours Canada.
Market and Sector Challenges (Strengths and Weaknesses)
Typically, the export of services and technologies presents fewer challenges than the export of goods, primarily because of the barriers-both trade and non-trade-that are imposed on goods. This is likely one of the primary reasons that Canadian environmental services and technologies have performed so well in the local market in comparison to goods in the same sector. The difficulty associated with exporting goods to Barbados is exacerbated by the cost and limited availability of freight between Barbados and Canada.
Apart from the cost of shipping goods to the island, companies selling environmental goods could experience difficulty because the local market is sometimes not sensitized to the range and diversity of environmental products available and the benefits associated with the use of these products. Demonstrating that such goods are cost-effective in the long term, though sometimes not in the short term, might also prove to be difficult.
Import duties on items characteristically used within the environment sector are 5%, although the Government of Barbados reserves the right to impose import duties of up to 20% of the cost, insurance and freight (CIF) value of imported goods. In addition to the import duties, goods are subject to a 15% value-added tax (VAT) and a 2% environmental levy.
Despite the high costs associated with the import of goods into Barbados, the government makes it easier for some stakeholders to access environmental goods. The hospitality sector benefits from concessions on some environmental goods that will be used in the accommodation sector and in restaurants. These concessions allow the duty-free entry of environmental goods to be used in hotels and restaurants, and this is supported by the Tourism Development Act.
In addition to the concessions offered to the hospitality sector, there are incentives in place for Canadian and other foreign companies investing in Barbados. These incentives include:
- A tax rate of 1% to 2.5% for international business centres;
- Subsidized factory or office space available for rent in well-planned industrial parks;
- Full and unrestricted repatriation of capital, profits and dividends;
- A special tax rate of 2.5% for export industries after the expiration of the tax exemption period.
Besides issues relating to shipping and local duties and taxes, the comparatively slower pace of business in the region is another issue that Canadian companies often grapple with on entering the local market. This is exacerbated by the fact that the government is the national authority on environmental issues. As such, when there are projects to be implemented, representatives have to undergo an often lengthy bureaucratic process before any action can be taken.
Sub sector Identification
There are a number of sub sectors within the environment sector that are of great significance from a national perspective and on which the Government of Barbados will continue to focus over the next few years in order to fulfill the island's millennium development commients. These sub sectors include:
- Solid waste;
- Wastewater and sewerage;
Each of these sub sectors is explicitly mentioned in Barbados' National Strategic Plan 2006-2025. Efforts are currently ongoing to:
- Maintain a safe and reliable water supply;
- Establish mechanisms to reduce, reuse and recycle solid waste;
- Establish waste treaent facilities that could adequately handle the waste of the Barbadian public as well as that of visitors to the island;
- Establish renewable and reusable forms of energy.
Plans have been and are being developed for the implementation of projects to assist in the successful realization of these goals. Water, energy, and wastewater and sewerage in particular are expected to present a number of project opportunities in the near future. The table below outlines some of those opportunities.
Upcoming Approved Projects
- Design and construction of a bulky waste facility in Bagatelle, St. Thomas
- Before the end of 2007, the government will start the process to develop and implement a GIS and hydraulic network model
- Design and installation of a Supervisory Control and Data Acquisition (SCADA) System
Wastewater and Sewerage
- Consultancy services for the development of a wastewater reuse policy and retrofitting of the Bridgetown and south coast sewerage treaent plants to tertiary treaent level for irrigation and groundwater recharge
- West Coast Sewerage Project: design and construction of a sewerage treaent plant for the west coast of the island (this area is Barbados' primary tourism belt)
The aforementioned projects will be preceded by:
- Consultancy services for a cost-benefit analysis of various options to facilitate the reuse of effluent and to mitigate against effluent being discharged through ocean outfall returning to shores due to seasonal reversal of currents
- A road network study to allow for minimal disruption of traffic flow to the west coast resident and hotel plant during the construction phase