The fact that the Vieux Fort roundabout lay bare, with not a single Christmas light to spare, may have been an ominous sign that things are not too bright in the country. After all, Vieux Fort South is represented by Kenny Anthony, prime minister of Saint Lucia and while leader of the opposition, the purveyor of the “better days” syndrome. But it seems that Christmas this year has missed the people of Vieux Fort South, not to mention the rest of the country.
Prime Minister Dr. Kenny D. Anthony and his administration have continued to administer medication, which is evidently bad for the country’s ailments. In the face of such poor economic stewardship they have the gall to brag about it. As we know, self-praise is no praise and he who feels it knows it.
For a cadre of politicians who created a monster by making unrealistic promises while in opposition, and by feeding the people with copious amounts of supposed answers – particularly to fix our economic problems – it must be a frantic existence, now that promises have been replaced by excuses and pleas for understanding and patience, that is, when they are not busy blaming the previous government. It must be remembered that this very Labour party administration assured the populace in no uncertain terms that they possessed the skills set, intellectual agility, good reputation internationally, and professional experience to redefine the economic fortunes of Saint Lucia.
Now the government has resorted to asking the public to provide the answers to the challenges confronting the country. There seems to be a complete dearth of ideas, imagination and innovation by this administration.
The harsh reality that the prime minister has been masking and sugar-coating for political expedience is that the Saint Lucia economy has seen three successive years of decline inclusive of this year. We refer to consecutive declines in 2012 and 2013, which by any definition amounts to a recession. By all indications of economic activity in 2014, we have little reason to expect that the trend of economic decline will be miraculously halted in 2015.
The UWP opposition, almost always in snooze mode, has certainly given the government more than enough breathing space, in order for them to implement optimum solutions to the economic and fiscal challenges confronting the country.
Apart from the introduction of VAT, which is supposed to boost government revenue, the extent of the government’s brilliance to address the economic challenges has been to squeeze more from the people through hikes in cellphone, utility and sewage charges, as well as a reduction in subsidies on essential food items. There are other proposed reductions of the disposable income of workers through a 5% cut in salaries. So there we are, squeezed on the expenditure side, squeezed on the income side and of course there is the pending increase to bus fares which has already been negotiated and approved.
To the best of our knowledge under the Labour government’s so-called shrewd economic policies, Saint Lucia’s fiscal position has deteriorated. The national debt is now over 80 percent of gross domestic product (G.D.P.).
This government has failed to meet its fiscal targets over the course of three years at the helm. The circumstances the SLP administration inherited, as the PM loves to say, have taken a nose-dive. Increasingly, government’s poor economic management is being reflected in rising fiscal deficit and national debt. Is this a report card to shout about or celebrate?
Ironically the prime minister of Saint Lucia was recently the Chair of the Monetary Council of the ECCB where he was expected to preside over, lead and advise on wider economic and financial woes within the sub-region, while there were ongoing precipitous declines occurring in his own country. His tenure hardly served as a model to be followed by other ECCB members, given that the Saint Lucia economy is in shambles. It must have been a relief to hand over the role to his successor.
In the face of this gloomy commentary, pray tell, what is Labour celebrating and bragging about? A perusal of the latest Economic and Social Review and an appreciation of the figures therein, as pertains to key areas such as the Real Sector – tourism, construction, manufacturing, agriculture among others, figures on Central Government Fiscal Operations, Public Debt, the Monetary & Financial Sector, Trade & Balance of Payments and so on, are not cause for celebration but rather cause for serious concern about the island’s viability and future.
“Notwithstanding the recovery in the global economy in 2013, economic activity in Saint Lucia remained sluggish. Preliminary estimates indicate that growth in the domestic economy contracted further in 2013 by 2.3 percent. Most of the productive sectors recorded declines in 2013 led by the construction and distributive trades sectors. During the review period, there was a sharp decrease in construction activity, mainly reflecting significant declines in public investment and foreign direct investment related to hotel developments.” – Economic and Social Review 2013.
It is instructive to note that the trend of economic decline being experienced in Saint Lucia is in stark contrast to what is happening in a number of other Caribbean economies which are on positive growth trajectories, which is in line with the upward trend of the global economy which is showing a positive growth trajectory of about 3 percent. We can cite Guyana, Surinam, Antigua, Jamaica and Trinidad. These economies have stabilized and started to grow after the 2008/09 crisis. So what is wrong with Saint Lucia? The short answer is Kennynomics. Populism and political expedience such as “jobs for the boyz” preferred over sound policies that ensure long term economic growth and development.
At any rate the current administration can no longer continue to use the excuse that the woes of Saint Lucia’s economy are part of a wider regional or even global phenomenon. They can no longer hide behind the global economic crisis, considering they loudly disregarded this as a likely reason for any economic challenges faced by the UWP administration. So in the face of these realities, what are they bragging about?
And so it is indeed fitting to reiterate to the current SLP administration that “You can fool some people all of the time, and all of the people some of the time but you cannot fool all of the people all of the time” because now they see the light.
This government, in typical fashion, has made blunder after blunder, not necessarily acting in the interest of Saint Lucia but to appease narrow audiences by engaging in their interests; and by opposing, for opposing sake, too many projects or proposals advanced by the UWP, even the good ones.
In opposition the Saint Lucia Labour Party opposed the Airport Development Charge imposed by the UWP, describing it as an act of “deception and stealth.” So here we had an airport development charge which is essentially a through-put tax, financed mainly by visitors who account for about 90% of airport traffic.
“The Saint Lucia Labour party recalls that the Bill creating the tax was never circulated to the Opposition ahead of the debate on the tax,” the SLP website stated. Then in May 2012 during the budget presentation, the recently re-elected Prime Minister and Minister of Finance Dr. Kenny Anthony had this to say about the tax: “In opposition, we had difficulty with this tax. In our view, this tax is unconscionable at this time especially given our challenges in increasing stay-over tourism arrivals. It is a tax to pay for an event in the future. Not one block has been put into the ground to justify the tax.” And then the suspension, not revocation mind you, followed: “The Government, therefore, will suspend the application of the section of the Act authorizing the tax for the time being.”
The through-put tax is a mode of financing widely used around the world especially in funding projects such as airport developments, and has been used effectively by many other countries. The proceeds of the charge, which have accumulated in a special interest-bearing, locked box account, have accrued several millions of dollars which would have made the redevelopment of the airport project all the more affordable. (What has happened to these monies?) However, for weak and tenuous reasons, the current administration has disingenuously reduced it to zero.
This proposal by the government of the day, to attempt to court a foreign investor in a Private Public Partnership (PPP) must be juxtaposed with a profound comment the current prime minister made about the Airport Development Charge: “I am advised that since the imposition of the tax, SLASPA has collected US$7.7 million thus far and it is anticipated to collect a total of US$10 million for the year 2011/12.”
Even as they have stopped the airport development charge, the Minister for Ports, Infrastructure and Transport is busy looking for a private investor to take over the H.I.A.’s operations. It appears that now they are willing to give up control and ownership of the airport. Many would rightly hope this one does not turn out to be another Grynberg on our hands. That’s the result of opposing for opposing sake. Currently ‘visibility is poor’ to use a term in that sector, concerning both Hewannorra and George F.L. Charles Airports as the futures of both are steeped in uncertainty. Clearly our air traffic controllers – Kenny and company – have a very precarious flight plan that is likely to cause a crash.
Another major blunder which is most apparent and imposed by this government, but is, however, well aided by the silence of the media, relates to the government’s pricing policy of petroleum products widely known as the Market Pass Through mechanism. This mechanism, which was set to allow a monthly adjustment of petroleum products under the former administration, was altered and increased to a three month period. This policy change has certainly not been in the interest of Saint Lucia or consumers of petroleum products who now have to wait for all of three months before they can benefit from the current downward trend in world oil prices which has declined steadily throughout this year from a peak of over US$100 to current levels of about US$57.
Other islands in the subregion are already enjoying this relief; meanwhile local consumers are forced to pay higher prices: a gallon of unleaded gas in Dominica is $12.82 right now; in Saint Vincent it is $13.81. In Saint Lucia unleaded gas per gallon stands at $15.84. This means that Saint Lucian consumers are now paying over $3.00 more than consumers in Dominica and so on, costing the economy millions more for the commodity. The difference in the other islands is that their prices are adjusted at shorter time intervals.
It is always easier to sit from the perches of the opposition benches or the Castries Market Steps and parade as a fix-it bunch of magicians. While I have focused on the economic performance of this administration, the social side is also an abysmal failure: increasing crime, suicide, hopelessness, frustration, overall degeneration and social decline is awash in communities throughout the length and breadth of the country.