Construction Stimulus!

In keeping with his 2012/2013 Budget Address titled “Building Opportunities for Our Common Future,” Prime Minister of Saint Lucia, Dr Kenny Anthony announced an 18-month construction stimulus package in an effort to jump-start the economy.
Construction, he says, had been chosen by his government to drive the economy in the short term, until full recovery in the tourism sector and the return of investment to the island is reached. Dr Anthony believes the construction sector is one with the greatest potential to stimulate the economy, reduce unemployment, and enhance growth prospects for St Lucia.
“Recognizing the urgency of bringing ‘bread and butter back to the table’ for many Saint Lucians, and the dire need to find a long term solution which will provide sustainable growth of our economy, I proposed a multi-faceted approach based on a bundle of measures as follows; one, tax relief and other fiscal consolidation measures; two, aggressive targeting of foreign direct investment; and three, employment generation through direct public sector investment.
“Since returning to office last year, I have held several meetings and consultations with various sectors of the economy and society. I have, on each occasion, called on all to search for novel ways to weather these difficult times; to take actions that we may never have contemplated taking before. I have said, on more than one occasion, that we may have to re-visit what we once declared to be sacred or even fashion policies that we once held to be unthinkable,” said Anthony.
He went on to explain that Government cannot sit back, and maintain a supervisory role of the economy. He says his government cannot allow the status quo to prevail in harsh economic times. For this reason, Dr Anthony adds that the economic crisis St Lucia is now faced with “requires a re-engineering of Government’s role in the economy; a re-engineering that would bring back hope to our businesses and our people, that would alleviate or reduce unemployment among our youth. We cannot afford to allow such delicate and creative minds to go to waste.”
The benefits of the announced Construction Stimulus Package include reductions in the price of building materials, improved access to land, reduction in legal fees, removal of stamp duty and access to low cost financing. Bringing the stimulus package to fruition however necessitated the involvement and participation of a number of partners.
“This package is unique, because we have fashioned a partnership between Government and key private sector bodies for the single cause of stimulating economic activity. If we are going to cause the turn-around in this economy then every single one of us has to make a sacrifice. We need each other.
“While Government is taking the lead to forego over $45 million dollars in revenue to execute this Programme, I am heartened at the response and eagerness that has been demonstrated in particular, by the Banking Sector, the Chamber of Commerce and the Bar Association.  I am grateful that all of us have managed to come together to make the sacrifice to forgo possible earnings that would no doubt be accessible during good economic times, in an attempt to offer a product that would bring some relief to our citizens,” said PM Anthony.
Under the program consumers will benefit from reductions in the cost of building materials by up to 41 percent less than regular market prices. Retailers will be able to offer these reduced prices because government has removed all duties and taxes on these items including a suspension on VAT.
President of the Saint Lucia Chamber of Commerce, Gerard Bergasse, commended the government for initiating the stimulus package.
“We want to thank the government for its efforts at stimulating the economy and hope that this construction stimulus package is only the start of other such initiatives. As we all know these are trying times and the economy needs every boost that can be provided to it. So we wish this initiative every success,” said Bergasse.
In the programme, it was announced that some banks will be offering reduced interest rates of up to 5 percent on loans for the first five years with a gradual step up increase to 8 percent for the remaining 5 years. For persons wishing to acquire lots, the programme through the National Housing Corporation (NHC) will provide serviced lots at competitive prices. Meanwhile, the Bar Association has agreed to reduce related legal fees by 30 percent to accommodate anyone wishing to take advantage of the stimulus package.