Both Sides of The Coin: The Story of The Central Bank of Barbados 1972-2017

Chapter 1: Background to Establishment 13 confident that the Central Bank would contribute to the conditions necessary for the further development of the local economy. The Cabinet Paper was approved and circulated to a number of persons for comment. These included President of the Caribbean Development Bank (CDB) Sir Arthur Lewis, G. Arthur Brown and Victor Bruce, the governors, respectively, of the Bank of Jamaica and the Central Bank of Trinidad and Tobago, and Head of the Economics Department at the UWI at Cave Hill, Ronald Bonnett. The comments on the Cabinet Paper were incorporated into a discussion paper on the subject. The draft Central Bank of Barbados Bill was then prepared by the Ministry of Legal Affairs and the Central Banking Service of the IMF and submitted to the Barbados Cabinet together with the White Paper, early in February 1972. The Cabinet devoted an entire meeting to a discussion of the draft Bill before it was laid in the House of Assembly. The Parliamentary Debate and Proclamation The Central Bank of Barbados Bill was read for the first time in the House of Assembly on February 22, 1972, on a motion put by Prime Minister Barrow and seconded by Deputy Prime Minister and Leader of the House C. Edwy Talma (later Sir Edwy). The substantive debate on “A Bill to provide for the establishment of a Central Bank of Barbados and for connected purposes” started around 5:00 p.m. on March 7, 1972, after a week’s postponement. The motion for the second reading was put by Talma and seconded by Minister of Agriculture, Science and Technology A. DaCosta Edwards. The debate dealt with several issues which would become topical much later and have serious implications for the Bank’s operations. The contributions of the two main speakers exemplify this. The prime minister piloted the Bill through the House, pointing out that the delay in bringing it to Parliament resulted from the thoroughness which had gone into the drafting and lauded it as a model for central banks in developing countries. He said that a country needed to take control of the financial system if it wanted meaningful monetary policy, without