BASSETERRE, St. Kitts, May 17th 2011 (CUOPM) – A packed and enthusiastic 79th Annual Conference of the governing St. Kitts-Nevis Labour Party responded with attentiveness and affirmation as the twin-island Federation’s Prime Minister Hon. Dr. Denzil L. Douglas enumerated the many bold and visionary actions that both his and former Labour Administrations have undertaken over the years, in order to produce the phenomenal social and economic progress that the people of the twin-island Federation have witnessed in their lifetimes.
Over 500 delegates, officials, representatives of the diplomatic corps, and invited guests gathered under this year’s theme “Planting Seeds Today For Tomorrow’s Harvest,” as Party leaders and loyalists took pride in recounting the difficult choices in years gone by that led to their being, today, the largest, strongest, and most respected political party in the nation’s history.
Prime Minister Douglas reminded the crowd of the wise decisions taken by his Government thus far in order to avoid the massive social and economic traumas that the same crisis had inflicted on some of the most powerful nations on earth. And, in keeping with this year’s Conference theme, he assured the visibly supportive crowd that decisive policy actions by his Government not only have brought, but will, indeed, continue to bring long term benefits to the Federation.
“We have had to introduce VAT to stabilize our public finances that were so badly affected by the global recession. At the same time, we have had to streamline the operations of Public Corporations with a view to enhancing their efficiency and reducing their claims on scarce financial resources of the central government. Moreover, we were forced to restructure the very generous subsidies that we provided to electricity consumers in our Federation. This has combined with increases in commodity prices all over the face of the globe, to increase our inflation rate and create new challenges for our households,” he said.
“It is very clear, however, that our actions have helped to avert a potential crisis that could have been far more devastating on our people.” The Prime Minister made reference to the tragic closing of schools and hospitals in the United States and other major powers, and made reference to the massive dumping of real estate that had also become commonplace in those countries – a fate that has been averted in St. Kitts and Nevis due to prudent and responsible decision-making on the part of his Government.
The IMF itself has expressed confidence in the package of fiscal initiatives developed by the Douglas Administration, and the Government has also expressed its commitment to continued collaboration with the IMF, and has expressed its readiness, should it encounter substantial shortfalls in revenue or financing, to further engagement in relation to access to its financing facilities.
It was against this backdrop that the Prime Minister and Party Leader outlined to the Conference the afore-mentioned range of stabilizing policy measures that have already been put in place by his Government. Indeed, in his Budget Address several months back, the Prime Minister had expressed his Government’s readiness to responsibly embrace any precautionary arrangement that may be necessary in order to tackle the nation’s debt problem.
The IMF’s arrival in the Federation on May 17, 2011 for its Article IV assessment is quite timely, therefore, as it will once again give the Government the opportunity to analyze the most prudent path forward. One possible outcome, which the Government would welcome, would be a virtual insurance policy in order to ensure that there is no adverse impact on the Federation’s financial sector as the Government pursues its debt reduction strategy. The advantage of such an arrangement is that it would provide confidence to the financial sector that the country would be provided with the necessary resources - should they be required.
“It should be borne in mind that we are members of the IMF and that we have access to the resources of this organization in a similar manner to a member of a Credit Union. There are certain conditions which would apply and I know that we will be able to satisfy such conditions for we have done most of the work that is necessary to stabilize our economy. Resources from this institution are available at around 1.5% interest rate,” the Prime Minister explained at the time of his Budget Address.
In keeping with its regular and ongoing responsibilities, the IMF Article IV Assessment Team
will be in the Federation until early June, and at the end of the Conference, in a one-on-one with a member of the media, Prime Minister Douglas was explaining that his Government was looking forward to the arrival of the IMF Team since his Government’s work with the institution represents precisely the types of “seeds” that have proven to be so essential to the advancement of the Federation in the past.
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