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

66 Licensing Review Committee which determined the allocation of import licences, a function that had implications for the balance of payments. Economic developments during this period led to foreign borrowing by Government on a number of occasions and this enabled the Bank to sharpen its skills in loan negotiation. Weakening foreign reserves during 1977 was the reason for the first act of foreign borrowing by the Government of Barbados with the Central Bank acting as fiscal agent. A loan of $15.1 million was secured under the Compensatory Financing Facility (CFF) of the IMF and the Bank raised $20 million through a line of credit from the Central Bank of Trinidad and Tobago. During the following year, the Bank helped to negotiate a seven-year US$10 million euro-dollar loan, with Orion Bank (from the UK) as manager. In 1980, the Bank arranged a debenture issue of $40 million in Trinidad and Tobago. It was the first time that such an operation had taken place between two countries in Caricom and the first time any foreign government was allowed to tap the Trinidad and Tobago capital market. Another large balance of payments deficit in 1981/82 led the Bank to again secure balance of payments support for Government from the IMF. The CFF was tapped and a Stand-by Arrangement, which was monitored by the Bank, was signed. Late in 1986, as part of a new medium-term external borrowing strategy, the Bank helped to float a 4.3 billion yen bond on the Japanese market (in September) and negotiated a US$40 million euro-dollar loan (in November). The Bank was agent for Government in the management of two credit facilities which were designed to provide relief from rising oil prices in the early 1980s. Under an agreement with the Venezuela Investment Fund - signed on March 3, 1981- the Bank received $7 million which was equivalent to 30 per cent of the average cost of petroleum imported from Venezuela to a maximum of 1,000 barrels per day. 38 During the same year, some $3.1 million was obtained from a facility made available to Caricom countries by Trinidad and Tobago in respect of imports of liquid petroleum gas and fertiliser. Under this mechanism, advances were made on the basis of any increase in prices over the levels at January 1, 1979. The sugar industry also benefited from the Bank’s negotiating expertise. During 1982 the Bank