Ladies and Gentlemen, Good Morning.
Let me extend a warm welcome to everyone who has taken time out of your busy schedules in order to spend time working in partnership with us on this year’s National Consultation on the Economy.
This is an annual event which is being spearheaded by the Ministry of Finance. However, we are doing things differently this year in order to reflect our belief in participatory government. We want to increase the level of input that our key stakeholders have in driving the prosperity of the Federation forward. We value your views and we are also keen to hear about how, through partnership and innovation, we can make the best of our limited financial resources in order to achieve the greatest impact.
We may be small in terms of land mass but we are punching well above our weight with one of the highest growth rates in the Caribbean, and the Americas for 2015. For 2016 St Kitts and Nevis is projected again to be the among the best performing countries in the Eastern Caribbean Currency Union (ECCU) and CARICOM Member States. While we are projecting a growth rate of above 3%, advanced countries such as the USA and Canada are recording growth rates in 2016 of 2.2% and 1.4%
respectively. The ECCU as a whole is projecting a growth rate around 2 plus percent. There is no doubt that St Kitts and Nevis comparatively and absolutely is moving in the right direction. Yet there is so much more which we must do to bring a better quality of life, higher paying jobs and entrepreneurial opportunities for the young men and women of Charlestown, Brown Hill, Cotton Ground, Mc Knight, George Street, Tabernacle and Lodge, and indeed for the young people all over St Kitts and Nevis who want to see progress in their lives. We know there are many young people who want to make it on the straight and narrow way, and who want to make it by fair and honest means. That is why we introduced the FRESH Start loan programme to provide affordable financing to SMEs. During the course of this quarter, we expect that a further $30m will be raised by the Development Bank to continue the programme. This will be the largest tranche of support ever targeted to SMEs at any period.
We need to develop the kind of cushion that gives us resilience and sustainability but more importantly we need to be able to invest in our key sectors that have a transformative impact on the quality of lives of our residents, citizens and businesses.
Our economic growth has provided the necessary resources for the Government to finance the activities to pay down on its debt. Over the last eighteen months we have paid down some $200m on the Public Debt inherited amounting to a massive $1.7billion plus millions of dollars of debt accruing to the PDVSA. Contrary to the doom sayers, the economy is doing well and the excellent performance of Government revenues relative to our Budget, speaks positively to the confidence of the economic actors in the Government.
Preliminary data indicate that the fiscal operations of the Federal Government for the first 8 months have resulted in a Recurrent Account Surplus of $107.5m, an Overall Surplus of $116.m and a Primary Surplus of $133.3m. The Recurrent Account Surplus surpassed the estimate by $44.0m (69.2 percent). The Overall and Primary Surpluses exceeded their 2016 targets by $85.6m and $80.6m respectively. These surpluses also compared favourably to the corresponding period of the previous fiscal year as the Overall and Primary Balances were higher by $59.4m (104.8 percent) and $54.2m (68.6 percent) respectively.
Our Fiscal Affairs are being well managed by the Government. As a result, we have adequate buffers/reserves to meet short term contingencies and to mitigate short term shocks. Let me thank the Financial Secretary and her staff at the Ministry of Finance and all accounting officers for a job well done in a highly challenging global environment.
This year’s consultation theme, “Working Together – Accelerating Growth and Building Resilience” is all about just that.
We are operating in challenging times. The squandermania leading up to the 2015 elections is now gone for good. Fiscal prudence is now the new order of the day. It is no secret that the profligacy of the past Administration created an artificial economy of special projects and initiatives which were neither well thought out nor sustainable. That is why my Government must straighten things out for the long term sustainability of our Country. That is why for example, the PEP program which has cost us over $200m is being revamped and the new dispensation will be a STEP Up from PEP. This will result in genuine
training for our people. This training will be market driven supplying the skills that the economy requires. For example, in hospitality, culinary arts, and other technical skills (air-conditioning, steel bending, joinery, craft making, etc). That is why we have restructured and repositioned the REACH Programme into SAFE – Supporting the Advancement of Further Education. This is a much more progressive and fiscally responsible approach to financing education and training, where only those in need would receive a subsidy from the public purse.
We also recognize that in this ever changing world, global warming has caused weather patterns to change, the impact of which has been quite severe on our Federation in the past and more recently on our neighbouring islands. We therefore need to learn from our experience and the experiences of our neighbours. We need to position ourselves so that we are in a state of readiness and that our country is resilient to not only these types of disasters but to the many threats that come with the intensification of the varied effects of climate change and to external shocks in general. We need resilience to overcome the challenges that come at times without warning and undermine our finances and productivity. Two examples would be the chickengunya, and the zika virus.
It is for this reason that we must build resilience now to protect the fiscal, economic and social gains that we have achieved as a country. The Government, however, cannot do it alone and should not be expected to undertake such a great and important task on its own. The Public and Private Sectors and Civil Society in this, our Land of Beauty, must work together if we are going to advance the pace of growth and have a resilient economy; a resilient country. We are a resilient people.
I am confident that we can draw on our institutional and commercial acumen, our individual and collective strengths to contribute to the building of a stronger St. Kitts and Nevis. Together we can achieve our goal of building a sustainable Federation built on a dynamic green economy. Moving forward, I intend to increase and improve on the
regularity of dialogue with the Chamber of Industry and Commerce (CIC) and the wider civil society. We hope that each group can clearly articulate what role it can play in advancing the National agenda. I accept the invitation of CIC through its President to convene a national growth forum on the economy in the first quarter of 2017. Today is a precursor to that event. We thank you for the perspectives given on several matters which are subject of focus group discussions today.
My Government intends to take on board the recommendation of the International Monetary Fund (IMF) to invest in targeted transformative projects that will improve competitiveness, diversification and resilience of the economy. In doing so, we will review and prioritize our Public Sector Investment Programme to ensure effective execution and completion of the capital projects identified as essential for the transformation of the Federation. Additionally, while we have already identified the key growth sectors of our economy, we believe that there is much work to be done to ensure that these sectors are strategically focused to assist in the drive to accelerate growth and development in the Federation. We will continue to encouragethe development of sectors such as Agriculture, Tourism, Manufacturing and Information Communication Technology (ICT. We are also aware that some sectors are constrained by various challenges and we therefore welcome your proposals and suggestions as to how the sectoral issues could be addressed and how robust economic growth could be further stimulated.
Ladies and Gentlemen, we are pleased that you have accepted our invitation to today’s National Consultation on the Economy and I emphasize that this is a consultative process. We want to hear from you and to hear your views, for example, on what could be done to assist the manufacturers at the Industrial Site, or our farmers, or to share with us your views on the current state of the Construction Sector, the ICT Sectorandthe Financial Services Sector. We are interested in your thoughts and your ideas for a better St. Kitts and Nevis. For this reason, the approach to the Consultation this year, via focus groups, will give
you a voice and the opportunity to participate in the sharing of views, ideas recommendations. Being respectful of your time, while at the same time ensuring that we stay focused, we will aim to identify issues and their remedial actions on specific thematic areas, consistent with the theme.
We have identified four main thematic areas for discussion, namely: Recent Developments in the Financial Services Sector, Climate Change and infrastructure requirements for growth and development, Social Issues such as Safety and Security and Education and finally,we must dedicate some time to dialogue on the essential issues regarding accelerating Economic Growth. In the interest of time, I will not take up much time on these areas save for the matter of Public Safety and Security.
Safety and Security
The prosperity which my Administration is committed to deliver to our people over the next ten years must never be frustrated by the wild, crazy, rhetoric of those misguided elements who want to turn Basseterre upside down. Equally, my Government will do all that we can to ensure that St Kitts and Nevis becomes the safest and most secure country on earth.
The seriousness of our commitment to stamping out antisocial activities and enhancing public safety is being demonstrated by our commitment to implementing our plan of action which was shared publicly in the early months of my Administration. Our recent decision to complement our local security personnel with personnel from the Regional Security System is also demonstrating the seriousness with which we are treating the safety and security issue here in the Federation. We thank civil society for supporting the advent of the RSS. Since 2011 the CIC, and other elements of Civil Society have been calling for strong action to restore law and order in our Country. Those calls were not heeded. The
politics took on paramountcy. My Government in contrast will always put law and order above political expediency.
As we continue to implement our crime reduction strategy, I use this opportunity to call on all citizens and residents to give their fullest cooperation in helpingus to jointly rid the Federation of the scourge of violent crime.
I would also like to encourage a lively debate on the performance and challenges facing the education system. We acknowledge that St. Kitts and Nevis is a leader in providing good quality comprehensive education for all ranging from preschool to primary and secondary schooling. Even with such an acknowledgement, we are certain that there are gaps which must be addressed in order for the education system to prepare our people for the world of work and take their place in building a better St. Kitts and Nevis. Our main challenge over the next few months would be to develop appropriate policies and a strategy that would help us to identify the actions required by the key stakeholders and channel our limited resources in a much more targeted manner.
My Government has already secured some US $8.5m in the Caribbean Development Bank to assist in the development of Technical Vocational Education and Training (TVET).
In conclusion, I want to thank you for being here today. Given the diverse group of stakeholders joining us for this consultation today, I am confident that the outcomes of the discussions will provide invaluable input for the development of a people oriented Budget for the medium term. It is my hope that during the sessions you will deliberate on the specific issues that have been identified in a spirit of mutual respect. I
look forward to the fruitful discussions and your full participation in this year’s National Consultation on the Economy.
I thank you.