There is an adage that says you cannot lead anyone beyond your own capacity. It is against this backdrop that small business training must be high on the agenda of all agencies engaged in business development, whether business support organisations, academic institutions or policymakers. Micro, small and medium enterprise practitioners must focus more aggressively and strategically at this time, on improving their management and technical competencies to enhance their overall competitiveness and drive business growth. For those who may not have the time or inclination to submit to an academic course of study, the National Vocational Qualification (NVQ) framework is a viable alternative to build skills and attain certification in key occupational areas.

This is why in 2015 the Small Business Association of Barbados underwent the process to become a NVQ Centre with the Technical Vocational & Education Training Council and has been a strong advocate for strengthening the local NVQ regime to broaden the training product available to MSMEs. Being an NVQ Centre has allowed the SBA to become certified to deliver five qualifications in a number of business development areas. One such programme is Developing a Business Enterprise Level 2, currently being offered to seniors at secondary schools. For the academic year 2024-2025, some four schools have been involved in a pilot project where more than 70 students are going through the process of assessment and verification to become competent in this NVQ. This means that scores of secondary school students will have an opportunity to graduate with an additional qualification to enhance their marketability and improve their skills in business as they look to enter the world of work.

The NVQ as a tool to drive business competitiveness is therefore an untapped resource which must be unlocked to enable MSME development at this time.

A NVQ is a work-based certification that recognises an individual’s ability to perform a job effectively by demonstrating relevant skills and knowledge in their specific role. Rather than focusing on academic theory, NVQs are centred around real-world competence in the workplace. This therefore makes the NVQ a suitable area of training for small business owners.

As described by the United Kingdom’s Vocational Training agency, at the heart of the NVQ is the concept of competency—having the right mix of skills, knowledge, and understanding to successfully carry out tasks associated with a particular job role. It is about proving the candidate can do the work to a recognised standard. The NVQ offers a flexible route to qualification without the pressure of traditional exams and provides a way to validate and formalise existing skills, boosting confidence and employability.

NVQs are practical, work-based qualifications that show a person’s ability to carry out tasks and responsibilities in a specific job or industry. They are ideal for those who may not have followed a conventional educational path, offering access to recognised qualifications that align with national occupational standards. These benefits include:

– Flexible, exam-free qualification path

– Recognition of practical skills and knowledge

– Certification aligned with national occupational standards

– Access to qualifications for those without formal education.

Small business owners can also use the NVQ framework to certify employees and build the skills of their staff in a manageable and flexible manner. NVQs are a powerful tool for workforce development. They allow employees to train while continuing in their roles, minimising disruption to daily operations. Employers benefit from enhanced staff performance, increased adherence to industry standards, and a clear demonstration of commitment to quality and professional growth. Benefits for the employee include:
– Efficient staff development to national standards

– Validation of practical job capabilities

– Minimal disruption due to on-the-job training

– Alignment of employees with current industry practices.

Recent figures from the UK show that more employers are looking for candidates with NVQs. These qualifications are seen as a trusted way to measure someone’s skills and readiness for the workplace.

There are several clear reasons why NVQs are becoming more important:

• Around 87 per cent of employers in the UK say they prefer to hire candidates who hold an NVQ.
• People with NVQs are about 25 per cent more likely to be promoted than those without.
• On average, NVQ holders earn 15 per cent more than those without similar qualifications.

These statistics highlight how much an NVQ can improve the job market. Equally, small business owners can further improve their competitiveness and viability through certification in their industry.

Much has been said in the marketplace about the need for certification of persons in particular occupational areas such as mechanics, nail technicians, masseuse, barbers, cosmetologists, among several other sectors. The list is varied and represents primarily those operating in the informal economy. To bring certification and standardisation to these industries, the NVQ framework can be used to assist practitioners in meeting acceptable standards while being certified in their areas of competence. The customer benefits from a quality product and experience, and the wider economy benefits from a quality infrastructure that contributes positively to the Barbados brand.

Vocational qualifications are accepted in most of the countries in the Caribbean Community. These are known as Caribbean Vocational Qualifications (CVQs), once recognised in CARICOM. MSMEs desirous of offering their products in the regional market will be more competitive having a CVQ/NVQ in the industry of specialisation. The qualification is equally recognised in the international market by several of Barbados’ traditional trading partners. This therefore is a further fillip to having a robust NVQ/CVQ framework with a varied number of relevant occupational areas.

A national programme is therefore needed to certify business owners, particularly in the informal sector, and to create a cadre of small businesses that are trained, certified and delivering goods and services according to a standardised and quality framework.

The CEO of the Small Business Association of Barbados recently addressed the Curacao business community under the theme, The Urgency of Now – Development Imperatives for the New Global Order.

Similar to Barbados and the Eastern Caribbean, businesses in the southern part of the region are also being challenged with the need to consider new business models for future growth. It is evident that the dismantling of the post-WWII global order is in train.

The literature described the period following World War II as the Age of Capitalism, led by Western Europe and the US. The Bretton Woods System was established to facilitate international trade and financial cooperation, contributing to global economic stability. Several institutions were established which worked in tandem to create a rules-based approach to development and to promote universally accepted standards.

During this period was the decolonisation of Caribbean countries with many trying to find a suitable development model after a long period of enslavement.

The Cold War ended in 1991, and the modern wave of globalisation began. The World Trade Organisation was created in the 1990s and the manufacturing giant China emerged bringing a new era of unfair trade practices.

For years, global institutions preached the virtues of free markets, competition, and trade liberalisation, rules often written and enforced by Western powers. Yet, as China rose by subsidising nearly every sector of its economy, the response from the so-called custodians of the rules was muted. Beijing was not held to the same fire that scorched smaller economies who tried to protect their own industries. Now, in a striking reversal, the United States itself is deploying industrial policy at scale and massive clean energy subsidies prioritising domestic production and national resilience over pure market ideology.

The literature suggests that in 2000 the US, Japan and the EU accounted respectively for 31 per cent, 14 per cent and 26 per cent of world GDP, while China, the Association of Southeast Asian Nations (ASEAN), and Latin America and the Caribbean accounted for 3.7 per cent, 1.5 per cent and 6.6 per cent, respectively. Figures for share of world exports were similar. In contrast, by 2023 the US, Japan and EU’s share of global trade had shrunk to 26.47 per cent, 4 per cent and 18 per cent of world GDP, while China, ASEAN and LAC grew to 19 per cent, 3.6 per cent and 7.18 per cent respectively.

From its entry into the WTO in 2001 until 2023, China’s GDP increased from $1.3 trillion to $18 trillion in nominal terms. In a short period, China became the world’s largest goods exporter.

The Bretton Woods institutions, while initially aimed at post-war reconstruction and development, evolved into a global behemoth often imposing policies on developing countries that hindered progress, resulting in structural adjustment programmes which inflicted austerity and market liberalisation thus stifling growth. These were often under the guise of promoting globalisation and international economic cooperation, designed to help countries integrate into the global economy.

The result has been anaemic growth in the Caribbean with an average of 2.1 per cent per year since 2000, with tourism-intensive Caribbean economies growing by only 1.6 per cent annually (0.8 per cent in per capita terms) and commodity exporters growing a bit faster with an annual rate of 3.7 per cent based on research.

The reality is that the global playing field was never truly level, and in this new fragmented order, it may never be. Small, open economies must therefore stop waiting for fairness and start designing strategies of self-preservation and transformation, centered not on outdated orthodoxy, but on pragmatism, technology, and regional strength.

The new imperatives for the region must begin with a hard pivot, away from dependency, and toward capability. Away from the false security of legacy models, and towards a new industrial identity built on two pillars: technology and regional cooperation.

1. Reindustrialisation through technology

Technology is not merely a tool, it is the new battleground of sovereignty. Those who control innovation control influence. We must therefore automate our agricultural sector to improve yields and reduce imports – consider precision farming, where instead of relying on manual harvesting farmers can now use drones, sensors, and data to increase output with fewer hands and less guesswork in a manner that redefines the value of human labour in higher-skilled, better-paying roles.

Within several countries of the region labour is not cheap and electricity is far from stable or affordable. Mechanisation offers a buffer. By reducing manual dependency in key sectors, we can improve productivity while insulating our businesses from wage and energy shocks.

2. Deepening trade integration

CARICOM is one of the region’s most important trade initiatives. Advancement of the planned single market and economy would lead to further increase in trade. This integration project must, however, extend to the wider Caribbean. As posited by Dr Matthew Bishop, in his article Situating the Caribbean within the new Global Political Economy of Development, 2015, interregional integration can be facilitated by new trade agreements and leveraging current agreements more effectively. Other recommendations included the granting of legal space, whether through a supranational Commission or otherwise, to implement decisions taken by the Heads of Government; the pooling of sovereignty; the creation of a single CARICOM Embassy in one location on an experimental basis to discern how limited diplomatic capacity could be leveraged by pooling together, to name a few.

Dr Bishop further opined that it has become increasingly clear that the neoliberal approaches to trade, since the 1980s, have instead produced a great amount of divergence, both between and within countries, rather than a rising tide that lifts all boats, along with a plethora of troubling global imbalances of all kinds. In sum, not only has no country ever developed under conditions of genuinely free trade, none has ever done so without some kind of activist, interventionist state. Today, China continues to subsidise its private sector.

The cost of inaction for the Caribbean is steep. We must therefore:

• Invest in national digital infrastructure
• Incentivise innovation and protect local IP
• Ignite regional trade alliances that prioritise shared industrial goals

The Small Business Association of Barbados (www.sba.bb) is the non-profit representative body for micro, small and medium enterprises (MSMEs).

Members and partners of the Small Business Association of Barbados recently engaged FLOW Business representatives in a webinar exploring the disruptive nature of Artificial Intelligence (AI) on today’s business.

Generative AI (GenAI) refers to advanced systems trained on large datasets to create, analyse, and optimise vast amounts of data. It can generate images, text, audio, and code, continuously learning and adapting as new data is introduced. 

Global Generative AI

Some 33% of global companies have adopted GenAI, with North America leading with a 40% adoption rate. McKinsey’s 2024 survey showed 65% of organisations use GenAI regularly, a 49% increase from 2023. On average, companies see a 3.7x return on investment (ROI) for every $1 invested in GenAI.

Google AI projects that by 2030, the global GenAI market will grow to USD$356.05 billion, from USD$25.86 billion in 2024.

Statistics for the Region

Information presented by Statista showed projected revenue growth from AI in the Caribbean and Latin America (LAC) of USD$92M in 2025 to USD$520M by 2030. A PricewaterhouseCoopers survey indicated that 45% of Caribbean businesses viewed AI as critical to their overall business strategy.

Within the tourism sector, 33% of businesses have adopted AI, with 30% still considering it. In agriculture, AI tools offered tailored, instant, advice to farmers, accessible via WhatsApp.

A world Bank study proffers that GenAI is expected to affect 26 - 38% of jobs in LAC, offering significant potential to enhance productivity in certain roles, particularly in the urban, educated, and formal sectors, as well as among higher-income earners. This could result in productivity improvements for 8 - 14% of jobs, but 2 - 5% of jobs may face full automation. However, digital infrastructure gaps and unequal access to technology could prevent up to 17 million jobs from benefiting fully from GenAI.

The study highlights the importance of bridging the digital divide, as many workers who could benefit from increased productivity are often employed in low-tech, informal roles. Workers in poorer countries are at risk of being ‘left behind’, as they lack the digital tools necessary to take advantage of GenAI. For example, in Brazil, a large portion of workers living in poverty, that is 8.5% might not fully benefit from GenAI due to 40% of them having limited access to digital technologies at work.

To address these challenges, the World Bank emphasises the need for governments to adopt proactive policies to ensure access to GenAI benefits. They include:

• Lifelong learning.
• Strengthening foundational skills
• Improving social protection
• Boosting digital
• Supporting workers in the informal sector.

By implementing these strategies, governments can not only minimise the risks associated with GenAI’s impact, but they can also maximise AI’s potential for promoting inclusive growth, reducing inequality, and fostering long-term, sustainable development across the region.

Businesssuite online suggets that AI adoption is frequently used in the financial sector, with banks and fintech companies implementing AI tools for fraud detection, risk assessment, and customer service. For example, in Trinidad and Tobago, Republic Bank introduced AI to improve fraud detection and safeguard transactions. Similarly, in retail and tourism, AI solutions like chatbots and recommended engines are redesigning customer interactions and marketing strategies.

AI is also being utilised to address environmental issues, with companies and governments exploring its potential to monitor weather patterns, manage natural resources, and support disaster resilience efforts. These initiatives offer opportunities for sustainable development and could attract global investors interested in supporting environmental solutions.

An Incus Services article opined that several Caribbean countries are leading AI adoption, including Jamaica, which was the first to establish a national AI policy, and Barbados, which is developing its own AI strategy. Trinidad and Tobago is exploring AI applications in the public sector, while Guyana has launched an AI lab with IBM’s support. These initiatives reflect the region's openness to AI and the Fourth Industrial Revolution.

AI’s growing presence in the Caribbean offers significant potential for economic growth, as it can enhance efficiency and productivity across industries, leading to more jobs and higher wages. It can also help address challenges such as crime, climate change, and healthcare. The rise of AI has already transformed sectors like banking, insurance, healthcare, education, and the creative industries, with tools such as predictive analytics, and content generators becoming widely used.

Small Business Solutions

The webinar identified four steps small businesses can consider for AI-Driven Growth:

1: Create an AI Integration Roadmap:

Develop a strategy for incorporating AI into the business processes.

2: Evaluate Data Infrastructure:

Ensure the business has the right infrastructure and data sources for the AI integration.

3: Staff & Training:

Hire or train staff with the necessary skills and also encourage involvement in AI initiatives.

4: Maximising ROI with AI Solutions

Align AI investments with business goals to maximise returns.

AI adoption in the Caribbean still has its limitations such as the lack of accurate demographic data and the underrepresentation of regional perspectives in AI algorithms.

While AI presents exciting opportunities, it raises concerns around human rights and ethics, such as biases in technologies like facial recognition. Better digital infrastructure, and AI training programmes are needed to ensure that the technology reflects the region’s needs.

The development of the cognitive ability of our people is another area of concern associated with AI. Already students in Barbados and the Caribbean are struggling with numeracy and literacy skills. It would be regressive for a generation to emerge that is incapable of simple arithmetic – one plus one – and is reliant on technology to make these basic calculations.

Last week Minding your Business looked at the recent budget and financial proposals, and while highlighting some of the positives for the social sector, also referred to the lack of initiatives for business facilitation. One of these areas was cryptocurrencies. Given the recent discussion around the Trump administration’s support for this digital asset, it begs the question why nothing was mentioned about this in the Budget.

The fact is Bitcoin has been given a new lease on life. One of the many executive orders (EO) signed by the new president was an EO to create a Strategic Bitcoin Reserve and a U.S. Digital Asset Stockpile putting the United States at the forefront of government digital asset strategy. 

According to the whitehouse.gov the Reserve recognises Bitcoin as a reserve asset and will be funded with Bitcoin seized through criminal or civil asset forfeiture actions by the Department of the Treasury. It also gives other federal agencies the opportunity to assess their authority to transfer any Bitcoin they hold to the Strategic Bitcoin Reserve. Bitcoin put in this reserve will not be sold but will be kept as a store of reserve assets. Authority is given to the Secretaries of the Treasury and Commerce to devise strategies for acquiring additional Bitcoin as long as these methods do not impose additional costs on American taxpayers.  

Bitcoin, having never been hacked, is often dubbed ‘digital gold’ and valued for its scarcity and strong security. The fixed supply of 21 million coins means that establishing a Strategic Bitcoin Reserve early, offers a significant strategic advantage.

In recent years, some Caribbean countries have gained attention as key players in the global cryptocurrency landscape. For example, the Bahamas, has implemented the Digital Assets and Registered Exchanges Act, which provides a comprehensive framework for cryptocurrency regulation.

Antigua and Barbuda has also emerged as a leader in digital innovation. Through its Citizenship by Investment (CBI) programme, the country now accepts digital assets, including cryptocurrency wallets, as legitimate sources of funds for citizenship. Popular cryptocurrencies such as Bitcoin, Ethereum, and others are among the major digital currencies accepted. Global Citizens Solutions reports that investors can choose from 33 approved real estate projects under the CBI programme, with cryptocurrency available as a payment option. The country introduced the Digital Assets Business Act in May 2021 and integrated it into its CBI programme.

The success of digital regulation depends on the extent to which regional governments will close the infrastructure gaps. Without the necessary technological and institutional support, laws with good intentions may struggle to be effectively enforced. Proper regulation must strike a balance—protecting consumers and preventing fraud while allowing innovation to thrive.

Another challenge for the Caribbean opined by IFC is the difficulty for Caribbean crypto firms to access banking services, limiting innovation and growth. The region must work to build trust with financial institutions and create collaborative forums to address concerns and find solutions that allow cryptocurrency businesses to thrive without jeopardising financial relationships.

A business case can be made for the use of cryptocurrencies, evidence in research done by cointelegraph.com, which suggest:

• Accepting cryptocurrency payments lowers transaction fees, eliminates chargebacks, and facilitates smooth global transactions.

• Companies across various sectors, including e-commerce and real estate, are incorporating cryptocurrency payments to attract a broader customer base.

• Challenges like price volatility and regulatory concerns can be mitigated by reliable payment processors such as BitPay, CoinsPaid, and Coinbase Commerce.

• Setting up cryptocurrency payments is simple, with no initial costs and easy-to-integrate solutions for small businesses.

• The widespread adoption of cryptocurrencies has prompted businesses of all sizes to recognise digital currencies, like Bitcoin, as a legitimate payment option.

A key feature of cryptocurrencies is the ability to enable individuals to transfer funds across borders without the limitations imposed by financial regulators or institutions. Over 659 million people, or 1 in 13 globally, use cryptocurrency in 2025. Additionally, around 15,000 businesses worldwide, including 2,300 in the U.S., accept Bitcoin. A key reason many larger companies are ‘jumping on board’ is the reduction in transaction fees. While traditional payment processors and credit card companies typically charge businesses between 2% and 4% per transaction, cryptocurrency payment gateways often bring this down to under 1%. For businesses handling a high volume of transactions, this can lead to significant savings.

Another advantage is the ability to reach a global audience without the limitations of currency exchange rates and international banking fees. Cryptocurrency payments allow businesses to make seamless cross-border transactions, making it easier to serve international customers. This is especially beneficial for sectors like travel, luxury goods, and digital services where global commerce is the norm.

Security and fraud protection offered also contribute to the growing appeal of crypto payments. Since cryptocurrency transactions are irreversible, businesses no longer have to worry about chargebacks, an issue that costs companies billions each year due to fraudulent disputes. This makes cryptocurrency particularly attractive to merchants in industries where chargebacks are prevalent, such as e-commerce and online services.

Consumers should however conduct the necessary due diligence before investing in cryptocurrencies as they are highly volatile and come with significant risks. Due to the distributed nature of these digital currencies, investors lack the protection or recourse that traditional financial systems offer.

Any discussions between the Caribbean Community and the Trump administration should therefore consider negotiating support from the US regime for CARICOM to build out its infrastructure to operate in the digital assets space.

The Caribbean stands at a pivotal moment, with the potential to become a significant player in digital asset regulation. Now is the time to leverage the relationship with one its oldest trading partners in an area that is still very much untapped with significant potential for innovation and growth.

Government’s Financial Statements and Budgetary proposals were presented recently to the usual anticipation in the private sector and amongst interested stakeholders. Due to the wide-ranging appeal to several interest groups, business leaders, civil society, financial planners and even academia, waited with bated breath to hear what provisions would be presented to address the concerns of their constituents.

Traditionally, the Budget presentation will align with the Administration’s vision for the country’s growth and development and represent the policy and/or fiscal solutions needed to enable the economy and society to realise the goals and objectives of this vision.

The 2025 Budget covered a myriad of issues to ensure a “Sustainable, Resilient & Inclusive Society”. The thematic areas discussed were Resilience Measures, Growth Measures, Revenue Efficiency Measures and Well-being Measures.

The presentation this year was arguably focused on social support. Advocates for men’s and women’s rights, health activists, and trade union leaders can all feel some sense of vindication for their tireless lobbying for improvements for their respective sectors. People with disabilities, homeowners, those in foster care, and pensioners were among many in the social sector that received notable incentives this year.

Deloitte in their overview, opined that the broader financial sector stood to gain from the Mortgage Insurance Act, which offers tax reductions on profits from mortgages issued under the Act. Mortgages valued below $250k are subject to an even lower tax rate of 4 percent.  

This initiative supports social cohesion by fostering economic development and addressing income inequality. Individuals will gain better access to credit and investment opportunities. In particular, lower-income households are expected to experience easier and more affordable access to mortgages, driving increased investment in real estate.

Not to be left out are credit unions that have been given a boost to their investment strategies. These indigenous financial institutions will now be able to contribute to productive endeavors such as tourism projects, real estate and renewable energy, further enfranchising their members and contributing to the overall economy. They will be able to invest up to 25% of their assets in the aforementioned areas. Additionally, the long-awaited deposit insurance scheme may become a reality in the next fiscal year.  

The let down was glaring for business. Some may retort that prior budget presentations introduced measures to support the facilitation of business and need time to develop due to the medium-to-long-term nature of the provisions. While some announcements like the incentive for businesses to digitise their operations have yet to be put in place, the annual budget exercise must consider the exigencies of the moment and keep pace with what is needed to foster an enabling business environment. At a time when a new global order is emerging, the cost of business continues to skyrocket and uncertainty prevails in the future relationship with traditional trading partners, nothing was offered in the Budget to address these issues. The business community cannot wait for next year March to have a discussion on the above pressing matters, some of which are existential threats.

The obvious positives for business include the reduction in water rates for registered farmers, a decrease in the regional travel tax and the change in permit requirements for tourists wishing to rent vehicles.

It is anticipated that those in the agricultural sector will be further incentivised to move with dispatch to shore up our food security strategies and reduce the food import bill. The tax on travel appears for inbound travel to encourage more visitors to the island for entertainment and vacation activity. Given the trade surplus that Barbados has enjoyed with the Organisation of Eastern Caribbean States, a reduction in the travel tax on outbound travel should also be considered.

While car rental businesses welcomed the removal of permits for tourists, the introduction of a levy of $10 per day for those renting vehicles was not welcomed, as many locals also rented vehicles, and this represents a further burden on local customers. The latter measures were projected to raise revenue of $13 million while the removal of permits generated a loss to Government of $355k. This is not a win for the car rental sector.

Two notable measures were appreciated for their intention to help build business resilience – the introduction of a threshold of up to $50,000 for businesses with annual income not exceeding $500,000 to benefit from the Resilience and Regeneration Fund; and the two-year grace period for existing businesses to retrofit their operations with potable water storage, back-up electrical generation and gas storage. Appreciatively, this may take more than two years for the thousands of small and medium enterprises to comply with this provision.

The assessment by PwC described the tax exemptions for meal allowances in the hospitality industry as likely to encourage businesses to provide these benefits to lower-income employees, boosting employee satisfaction. On the other hand, the anticipated increase in the national minimum wage, as decided by the Minimum Wage Board, will particularly impact SMEs that may not have planned additional wage expenses. The extent of this impact will depend on the review and adjustment of the current minimum wage rates.

The success of the measures will depend on careful management of fiscal resources, effective implementation, and continuous monitoring to ensure that the expected benefits are realised. As opined by Deloitte, the government's ability to balance immediate needs with long-term strategic investments will determine the overall success of these initiatives. A value-added feature worthy of consideration going forward is to provide an update on the performance and/or status of prior measures to allow some level of monitoring and measurement of the proposals and their impact on the economy and society.

By the time this article is published, the Barbados Government would have presented the financial statements and budgetary proposals for 2025 – 2026. The wish of all in the business community is that a suite of policy and fiscal considerations are introduced not only to stimulate growth within the local economy but equally, to address any potential negative impact of the new trade policies of the Trump Administration.

From his first term in 2017, President Trump demonstrated a keen recognition of the role trade policy played in ensuring a thriving middle class. He transformed the trade policy landscape, focusing on prioritising the national interest. He established a new consensus that tariffs are a valid instrument of public policy, advocated for tough trade enforcement, and showed that the US can use its leverage to open markets for American exports, especially in agriculture. Through these efforts, President Trump proved that a strong, realistic trade policy can create jobs, foster innovation, bolster national defense, raise wages, support farmers, and bring back manufacturing to the US.

American First Trade Policy

At the start of his second term this year, Trump signed the Presidential Memorandum "America First Trade Policy," in January. As reported by ustr.gov this outlined a plan for transformative change to address America's economic demise. The memorandum directs the US Trade Representative (USTR) and other agencies to take swift, unprecedented action to put America's interests first in trade.

The memorandum tackles the trade deficit by commanding USTR and other agencies to “investigate the causes of the country’s large and persistent annual trade deficits in goods, as well as the economic and national security implications and risks resulting from such deficits”.

Additionally, the memorandum directs USTR to review trade relations with all nations, identifying unfair practices including non-reciprocal trade, with the goal of using its leverage to open new markets and bring manufacturing back home.

USTR will also review existing trade agreements to ensure they support the national interest. This includes the US-Mexico-Canada Agreement (USMCA), which will undergo a review to assess its impact on American workers, farmers, and businesses ahead of the mandated 2026 review. The memorandum also addresses the US-China trade relationship, which has been a key driver of the trade deficit. Despite the Phase One Agreement negotiated in Trump's first term, China has not fully complied.

A recent article by Caribbean Trade Law argued that while these tariffs will hurt the affected countries—particularly manufacturers and workers—Trade 101 teaches that tariffs often have a bigger impact on the country enacting them. Trade between the USMCA countries is worth billions annually, with supply chains deeply integrated, specifically in sectors like automotive, agriculture, and textiles.

Many goods on American shelves are either sourced from these countries or contain inputs from them. As a result, US manufacturers will face increased costs for raw materials and intermediate goods from these nations, which they are expected to pass on to consumers. Many project that the outcome will be increased prices for everyday items.

Impact on Caribbean Consumers

Caribbean manufacturers that rely on US inputs are likely to experience rising prices and increased operational costs, which could ultimately lead to higher prices for end consumers. This could affect the cost of American-made goods, such as food, electronics, and vehicles. The Caribbean could potentially face higher costs and disruptions in supply chains.

However, Caribbean manufacturers can explore strategies to minimise the impact. One possibility is to look for alternative suppliers, to help mitigate some of the price hikes. This situation also presents an opportunity for more Caribbean sourcing – instead of importing so much fresh fruit from Florida, the Caribbean could increase regional sourcing.

The tariffs, which include 25% on certain imports and 10% on others, were set to take effect in February, however, have been delayed by one month.  

Trinidad’s Newsday reported that Business leaders and economists are concerned about the tariffs’ long-term effects. The CEO of the American Chamber of Commerce in Trinidad and Tobago, Nirad Tewarie, issued a warning stating that increased tariffs would most likely lead to inflation, making everyday goods more costly for Caribbean consumers. Vivek Charran, President of the Confederation of Regional Business Chambers, pointed out that the rising cost of imported products, particularly from Mexico, may have a significant impact on prices across the region as many food products in T&T are sourced from Mexico and processed in the US. Tariffs could therefore drive up costs for local importers.

Economist Terrence Farrell pointed out that tariffs imposed in retaliation are unlikely to benefit anyone, with the most significant damage potentially falling on the US due to its reliance on imports. Trump’s strategy primarily targets curbing illegal immigration and the flow of drugs across US borders. By leveraging tariffs, he seeks to pressure trade partners to meet US demands. However, this approach is not without its risks as both Canada and Mexico are crucial to US trade. Tariff impositions could drive up prices for American consumers.

The long-term effects of these tariffs remain unclear for the Caribbean region. Tewarie pointed out that businesses might seek alternative suppliers to manage costs, which could potentially lead to import substitution if higher prices for foreign goods persist. While such shifts could offer some opportunities, the impact of tariffs may be unavoidable, especially for economies that depend on imports from the US and other trade partners.

Earlier calls have been made in this column for a more united front by CARICOM leaders to make the integration project work for Caribbean people and businesses. Maybe Trump 2.0 is just the catalyst needed to determine once and for all if there is any future for regional integration.

Barbadians are generally law-abiding citizens – they stay in line longs at the bank, they generally don’t go through red lights, and they pay their fair share of taxes.

Anyone who worked throughout the Caribbean can easily make the contrast. When it comes to paying taxes, Bajans may not like the quantum or the reasons but will comply with the requirement to pay. Usually, they will demonstrate their dislike to the governing administration via their vote every five years.

It is against the desire to be compliant that many are voicing their disapproval of the level of ambiguity evidence in the new tax prepayment regime and the lack of congruence in the various policy briefs disseminated by the authorities.

The Global Minimum Tax Rate

The change in Barbados tax system came on the heels of the introduction of the Global Minimum Tax (GMT), coordinated by the Organisation for Economic Cooperation and Development. This new global system was intended to represent a significant milestone in global cooperation regarding the taxation of multinational enterprises (MNEs). The new framework ensured that MNEs with revenues exceeding EUR 750 million are subject to a 15% minimum effective tax rate, no matter where they operate. Introduced through the Global Anti-Base Erosion (GloBE) Rules, the GMT is a key element of the second pillar in the ‘two-pillar solution.’ The two-pillar solution, which was endorsed by over 135 countries in October 2021 OECD/G20 Inclusive Framework on Base Erosion and Profit Shifting (BEPS), addresses the tax difficulties created by globalisation and digitalisation of the economy. Following this, around 55 jurisdictions took steps toward implementation, with the rules set to take effect in 2024.

In 2023, Barbados initiated a significant overall of its tax system in order to comply with these global tax standards. As part of the reforms, the standard corporate tax rate moved from 5.5% to 9% effective January 1, 2023. However, certain sectors fell outside the scope for this new corporate rate including insurance companies, international shipping, multinational enterprises and small businesses. For the small business, a reduced tax rate of 5.5% was introduced pursuant to Barbados Income Tax Act, which also took effect January 1. 2024.

The confusion for taxpayers came in the definition of small business and who could benefit from the 5.5% tax rate. Whereas the entire small business community rejoices at the decision of government to carve out a system of preferences for small companies, the ambiguity became glaring as analysis was done on the information provided by the government.

The first policy note in January 2025 stated that the 5.5% rate was applicable to small businesses that have a gross income of $2,000,000 or less, AND are registered as an Approved Small Business under the Small Business Development Act, Cap. 318C.

It was evident this definition would disqualify thousands of small companies, and the well-intentioned policy would fail before it got off the ground. Through continued lobbying and dialogue, a new policy framework was announced on February 3, 2025, designed to correct this categorisation.  

The second policy note indicated that the tax rate is only applicable to those small businesses that satisfy the criteria found below:

• The company has gross income of $2,000,000 or less;
• The company has paid-up capital of $1,000,000 or less;
• The company has no more than 25 employees;
• At least 75% of the shares of the company are beneficially owned by a resident of Barbados; and
• Where the company is a member of a group, all members of the group must meet the criteria (1) through to (4) OR
• An approved small business under the Small Business Development Act, Cap. 318C

This definition is different to the one found under the Small Business Development Act which is generally used to define what a small business is.

Exclusions to the tax rate:

There were notable exclusions of firms that would not qualify for the new tax rate. These include:

• Companies not considered small businesses
• Companies/Societies that hold Foreign Currency Permits
• Companies that have been granted tax concessions or exemptions under any other enactment including a company operating under the Tourism Development Act, Cap. 341.
• Companies whose primary purpose is holding shares in other companies or holding real estate.

If the second policy note was intended to correct the confusion, it failed leaving stakeholders none the wiser.

There have been two mayor stakeholder sessions discussing this new tax policy within the last month – the Institute of Chartered Accountants of Barbados (ICAB) Annual Tax Update and the monthly webinars hosted by the Small Business Association of Barbados. During both sessions, attended by hundreds of business owners and professionals, the outcome was the same – participants were of the view that the authorities did not put the systems in place for this new policy regime.

Jason King, a member of ICAB’s Tax Committee, opined that while Barbados faces the urgent need to overhaul its tax system to remain competitive in the global economy, the country’s “outdated approaches, slow refunds, and unclear regulations discouraged investment and hinder long-term financial planning.

The unclear regulation is clearly the Achilles heel in this framework.

During the SBA webinar it became evident that the differences in the two policy notes were based on two different pieces of legislation - the Income Tax Act and the Small Business Development Act. Definitions and clarifications differed. Cognisant of this, the authorities needed to have done a better job of ensuring congruence in the processes, policies and procedures before communicating with stakeholders. Business owners are not recalcitrant of their obligations, they simply need clear and unambiguous guidelines to follow.

The dust has settled following the end of the 48^th regular meeting of the CARICOM Heads of Government and the questions remain about the next steps for the CARICOM Single Market & Economy. Were any resolutions made relative to advancing the regime of the single market and/or the single economy? Caribbean people and more so Caribbean businesses are no wiser after the regional meeting.  

The CSME is a region-wide initiative created by CARICOM aimed at fostering deeper economic integration within the Caribbean. It was envisioned as a way to address economic challenges such as limited market size, fragmented trade systems, and limited access to capital. The goal of the CSME is to create a single economic space where goods, services, capital and people can move freely among participating countries, thereby facilitating economic growth, development, and greater global competitiveness.

Given that the region is a group of small economies involved in a variety of trade agreements and negotiations at bilateral, multilateral and hemispheric levels, making a unified regional platform such as the CSME was essential.

Beyond the spill-offs that the Government accrue from increased economic activity, the chief beneficiary for a well-functioning single market and economy is the private sector and more so small business owners, who through the CSME regime, have the right to establish businesses across member states.

Entrepreneurs in small businesses face several significant limitations and challenges, which include:

• A policy environment that lacks sufficient focus
• Difficulty accessing credit and capital markets
• Low productivity and quality levels
• Limited resources for research and development
• Inadequate business information
• Poor transport, communication, and ICT infrastructure
• A need to access new technologies
• A lack of opportunities to build upon the existing entrepreneurial culture
• Challenges related to the CSME

In response to these issues, Article 53 of the Revised Treaty of Chaguaramas, titled “Micro and Small Economic Enterprise Development,” outlines the obligations of the relevant Councils within the Community. These responsibilities include:

• Promoting the competitiveness of SMEs
• Supporting the creation of agencies, such as entrepreneurial centres
• Addressing the need for access to training and education in areas like entrepreneurial skills and business management
• Encouraging financial institutions to offer appropriate and innovative financing options
• Fostering innovation within the small enterprise sector.

Antigua & Barbuda’s top diplomat Sir Roland Sanders recently opined that the failure to advance the CSME is not due to the efforts of public servants, but rather political leaders who prioritise national interests over regional unity. The lack of enforcement of commitments from the Revised Treaty of Chaguaramas has left the promise of regional integration unfulfilled. This failure extends beyond trade, with the deterioration of CARICOM’s foreign policy coordination, leaving member states vulnerable to external influence. The vision of CARICOM's founding leaders, such as Sir Shridath Ramphal and P.J. Patterson, understood that deeper economic cooperation and collective bargaining were essential for safeguarding sovereignty and prosperity. Their vision should guide the region, especially as small states face challenges requiring a united front.

The Ambassador proffered that to address these issues, urgent reforms are needed. These include reinvigorating the CARICOM Development Fund with mandatory contributions from larger states, eliminating non-tariff barriers, ensuring enforceable labour mobility, and strengthening foreign policy coordination. The integration movement must not be abandoned, as CARICOM remains crucial for preventing global marginalisation. The way forward is a stronger, more effective CARICOM that delivers on its foundational promises of fairness, equity, and shared prosperity for all member states, large and small. As Dr. Ralph Gonsalves has said, the region must build a stronger CARICOM to address the growing global challenges.

In a time of global instability, shrinking access to finance and the escalating effects on climate change, CARICOM should be stronger, and more robust. However, the deep-rooted trade disadvantages of smaller states have undermined regional solidarity. Despite efforts to build a true CSME, the necessary legal, structural, and compensatory mechanisms remain underdeveloped or unimplemented. Trinidad and Tobago has been the primary beneficiary of the CSME, while smaller states, particularly in the OECS, have been most affected.

The intervention by the Hon. Reuben T. Meade, Premier of Montserrat, at the opening of the 48th CARICOM Heads of Government meeting in Barbados is very telling. One of the key issues affecting the CSME’s realisation is the lack of consistent political will across member states. While CARICOM leaders have agreed on the importance of regional integration, national interests often take precedence over regional objectives.

In highlighting several key issues facing CARICOM and its member states the Premier emphasised the delays in implementing decisions made years ago, including the use of CARICOM Nationals' driver's licenses for travel and driving across member states, which have not been fully implemented. He also criticised the inefficiencies in airport procedures and high taxes that make free movement within the region more difficult. Meade stressed the need for greater digital transformation and resilience strategies to improve integration.

Meade called for a review of CARICOM's institutions to assess their relevance and efficiency, suggesting that some institutions may no longer be effective and should be restructured or removed. He urged leaders to focus on making decisions that directly benefit the people of the Caribbean, ensuring that CARICOM remains a relevant and effective organisation as it moves into its next 50 years.

As Caribbean citizens continue to ponder the next steps for the CSME, the question of its relevance in the future must be assessed.  In the words of Meade, if this institution is not effective it must be restructured and/or removal. Businesses need structures and systems that work.

Not enough micro, small and medium enterprises are using technology and digital solutions in their operations.

Admittedly, the COVID-19 period was a disruptor that caused rapid migration by some; however, the extent of the adoption is not as widespread as needed to make MSMEs more competitive.

Digital adoption refers to the process of integrating new digital tools and systems to enhance work processes and meet organisational goals. This involves using technologies such as software, hardware and online platforms to optimise operations, improve communication, drive and foster innovation. However, digital adoption is not just about using technology, it requires users to become familiar with digital products, understand their capabilities, and integrate them effectively into their workflows.

Recent research done by the Cave Hill School of Business, University of the West Indies, shows moderate information and communications technology use among local firms, with e-commerce in its early stages. The research showed that about 41% of businesses had some kind of online sales. However, these sales only accounted for 6% - 33% of total revenue. While mobile use was widespread at 99%, social media use was 53% and use of websites was 56%; an 85% increase over 2023. The report also indicated that 57% of businesses utilised digital media for marketing on platforms such as Google Ads, Facebook or Instagram, with a median of 35% of the advertising budget being allocated to these platforms.

The survey revealed moderate levels of digitalisation among firms. However, as investments in MSMEs’ digital development increases, there is significant potential for growth.

The COVID-19 pandemic brought about a wave of unexpected and disruptive changes to daily life for individuals and businesses. Measures implemented to stop the spread of the virus lead to deserted stores, schools and office buildings. There was an obvious decline in face-to-face interactions, in most cases, these interactions moved to digital platforms. While some MSMEs were able to pivot by adopting digital marketing, e-commerce, and payment systems, others faced difficulties.

A study by the Center for Financial Inclusion (CFI), noted that while MSMEs increasingly used low-stakes digital tools like social media and digital communication during the pandemic, high-stakes digital tools such as online payment platforms were less commonly adopted, especially among women entrepreneurs. Despite these challenges, those MSMEs that embraced digital tools experienced tangible benefits, including reduced fraud (through mobile money systems) and improved customer engagement.

Low Stakes

Low Stakes digital tools are cost-effective and require minimal resource commitment. This makes them accessible for businesses with limited budgets or those simply exploring their digital options.  Examples include tools to communicate with customers like WhatsApp or tools to market the business through social media such as Facebook or Instagram.

High Stakes

High stakes adoption involves more significant investments and often requires formal business registration and financial commitment, typically a higher level of complexity. Examples include delivery platforms, setting up e-commerce or operating an online store. 

The CFI report highlighted several challenges faced by MSMEs in digital adoption, including:

1. Financial Constraints

Many MSMEs struggle to make significant investments in digital technology due to high upfront costs. Limited capital often results in low prioritisation of digital transformation.

2. Digital Literacy

Many business owners and employees lack the necessary skills and knowledge to fully utilise digital tools. This gap in digital literacy can delay adoption and reduce the effectiveness of digital investments.

3. Infrastructure Issues

In regions with limited internet access or unreliable electricity, adopting digital tools can be a daunting challenge.

4. Cultural Resistance

Organisational culture can be a major barrier. Employees may resist change, and the lack of a supportive culture can lead to slow or failed adoption efforts.

5. Inconsistent Use of High-Stakes Tools

While many MSMEs have adopted basic digital tools, the usage of more complex systems, such as digital payment platforms and e-commerce solutions, remains inconsistent. Many small firms return to traditional methods of doing business due to perceived risks or lack of understanding.

A cost effective and efficient e-commerce framework has been a challenge for some time due to the inability of commercial banks to put this regime in place.

For MSMEs, digital adoption is crucial for staying competitive in an increasingly digital world. According to walkme.com the following steps are important in the digital adoption process.

1. Strategy

A clear strategy ensures digital tools align with business goals, helping employees understand how digital transformation will impact their work.

2. Culture

Successful digital adoption requires a cultural shift where employees feel supported and are motivated to embrace new technology.

3. Behaviour

New technologies often demand changes in workplace behavior. Regular training and support are essential to ensure smooth adoption.

4. Process

Efficient integration of digital tools requires a streamlined process from management to execution, ensuring optimal results.

5. Skills

Team member skills must be upgraded to handle new technologies. With proper training, business owners can become more adept at using digital tools, reducing the learning curve.

6. Software

Intuitive and powerful software is central to digital transformation, allowing MSMEs to improve work efficiency and achieve better results.

A well-structured digital adoption strategy leads to several benefits, including enhanced customer satisfaction, streamlined workflows and increased productivity, and positive returns on technology investments. It goes without saying that more must be done to sensitise business owners to these benefits and to facilitate access to resources and training to enable greater uptick of small businesses in the adoption of digital solutions.