BASSETERRE – Eighteen months after taking over a strong economy, the Team Unity Government under Prime Minister Dr Timothy Harris, has the twin-island Federation in a tail spin with rising unemployment and no clear policy or plan to sustain the economic fortunes it met.
Opposition St Kitts-Nevis Labour Party senator, the Hon Nigel Carty said Wednesday that last week’s IMF Report on St Kitts and Nevis “is a very stark outlook in respect to the fiscal affairs of St Kitts and Nevis.” With an estimated 5 percent economic growth in 2015, the IMF is forecasting a slowdown in the economy and is predicting a 3.5 percent growth in 2016 and a 3 percent growth over the medium term.
The slowdown is reflective of a tapering of construction activity started under the Labour Administration and a drop in the number of new CBI applications. Pointing to the report which stated that ‘St. Kitts and Nevis successfully exited the post programme monitoring framework at the end of October 2015 seven months of schedule,’ Mr Carty said it was as a result of the kind of economic performance and fiscal turnaround which respect to the affairs of the Government of St Kitts and Nevis.”
He referred to the report which stated that the IMF Team in its discussions with the Timothy Harris Cabinet “focused on the elements of a comprehensive strategy to lock in the gains that had been achieved in fiscal and debt sustainability in recent years” under the Denzil Douglas St Kitts-Nevis Labour Party Government. “It appears that the IMF has become very concern that the fiscal gains and economic gains and debt sustainability accomplishments in recent years are now been undermined by the reckless management of the present Team Unity government,” he told listeners to Freedom FM “Issues” programme on Wednesday.
He further noted the report findings that the “fiscal position remained in surplus at an estimated five percent of GDP” and the “Debt to GDP ratio continued its impressive downward trajectory path and is projected to reach the ECCU 2030 target of 60 percent in 2017.” On the Citizenship by Investment Programme, which Dr Harris and his Team Unity alliances attacked while in opposition, Sen. Carty noted that the IMF is suggesting that the programme has died a natural death.
He pointed to several projects under the programme which have run into severe difficulties as a result of Dr Harris’ closure of the country after taking office in February 2015. “There is hardly any new activity emerging out of that sector. While the IMF is saying there is a somewhat positive outlook for 2016, this whole notion of the CBI been dead is what is causing a problem for the continued economic development of St Kitts and Nevis and the emergence of fiscal challenges over the years,” said Carty
“Nothing is happening at T-Loft at Frigate Bay. That massive construction project has halted and in many other parts of the country developments have halted because of the serious challenge that we are having in St. Kitts and Nevis. We have the Embassy Suites and Kittitian Hill that are at a standstill,” said Carty.
Sen. Carty pointed to the concerns of the IMF, especially in light of recent disclosure that the Concerned Citizens Movement government in Nevis headed by Premier Vance Amory, who is also a senior Minister in the Federal Government is to receive, EC$140 million loan from the St Kitts-Nevis-Anguilla National Bank at an interest rate of three percent spread over 30 years. On Saturday, Hon Troy Liburd of Nevis said it was a US$140 million loan.
“With that kind of recklessness in the management of the Bank and accusations that the National Bank is now been run from Church Street, it gives rise to great cause in the business community and those persons who have responsibility of oversight of the fiscal sector here in St Kitts and Nevis,” said Carty.
The IMF in its news release pointed to lower CBI budgetary receipts, delays in external grants and temporary financing of SIDF spending weakened the fiscal position of St Kitts and Nevis compared to previous years.
“We have grants which we ought to be getting from the EU as a result of the arrangement on the closure of the sugar industry in 2005. Those inflows are not coming because the present government is not on track with its commitments towards debt sustainability and creating the kind of transparency which s required in government’s fiscal management,” said Carty, adding:
“Those grants will not come so long as this government continues to play politics with the fiscal stability of the country.”