The ratings on Barbados reflect the country's social cohesion and political stability as well as the fiscal flexibility that the National Insurance Scheme (NIS) surpluses provide. At the same time, the growing fiscal deficits and ensuing increase in the government debt burden do not bode well for the country's long-standing commitment to maintain the currency peg. The central government deficit (which includes off-budget spending) widened to 6.6% of GDP in 2008 from 3.8% in 2007. (For comparative reasons, Standard&Poor's Ratings Services analyzes Barbados using the calendar year versus the budget year, which is April to March.) This fiscal deterioration reflects dismal growth in revenues in 2008 amid a slowing economy and spending growth driven by rising transfers. Given
