The May 2002 ratings' affirmation reflects Barbados' record of prudent economic management, which gives the government the flexibility to use fiscal policy as a stabilizer to cushion the impact of 2001's cyclical economic downturn without weakening public finances. Success in developing foreign exchange earnings from the service sector during eight consecutive years of growth (averaging 2.9% of GDP per annum) provides Barbados with ample reserves to maintain both stability and the credibility of its fixed exchange rate. Barbados' ratings reflect: Its many years of good economic management, based upon policies consistent with the country's fixed exchange rate. Prudent fiscal policy and the country's high education and health standards underpin its flexibility in shifting toward a more-diversified service economy and away
