Parry highlights achievements, challenges in New Year’s Message
No more subsidies for businesses on Nevis
By Pauline Waruguru
CHARLESTOWN, Nevis - IN his New Year’s Message to the people of Nevis, Premier Joseph Parry highlighted his Administration’s achievements in 2008 but regretted that some workers would be laid off early in this year.
Premier Joseph Parry
The Premier extended New Year’s greetings to all residents of St. Kitts and Nevis and also those nationals who reside outside the Federation. “I especially remember those of us who live in the Virgin Islands, the nearby islands of St. Maarten and Anguilla, and of course the USA, Canada and the United Kingdom,” he said.
Turning to some of the challenges that may be experienced on the island in 2009, the Premier said: “Initially it was advised that the Four Seasons will be in a position to cover its workers for a stated period. I am now advised that the position has changed. Regrettably, some workers will be laid off in January. The government is monitoring the situation and is being advised and consulted as new developments take place.
“We are all aware that Four Seasons is pivotal to the continuing prosperity of Nevis at this time. It was closed due to an act of God. Since then, several announcements have been made in regard to its opening date. Rumours abound!
“At this time I am not in a position to give any definite date in regard to its opening. What has been brought to the attention of this Government is that the problem is more complex than it appears. The financial crisis in the USA did not spare the Four Seasons Hotel. Its major banking and Insurance partners are in the United States. There are certain financial requirements and constraints that are presently impacting on the Four Seasons that will provide challenges this year for the Government of Nevis and the employees at the Four Seasons Hotel.
“The Government, through the Ministry of Finance, will work with the Hotel Association to introduce ways and means to ease the shock of the recession and decline in visitor arrivals, will continue promotions and continue to work with the airlines to provide easy access to Nevis.”
The Premier said that worker benefits must be secured as his Administration works its way through this difficult time for the Four Seasons Hotel. He declared that the Nevis Island Administration (NIA) would also seek through its Labour Department to advise workers where jobs are available and would continue to work with the banks and other financial institutions in regard to loans and other obligations of workers.
“The year gone by has had its successes and disappointments,” he added, noting in relative terms the people of Nevis did well in spite of a year of recession in the United States and the closure of the Four Seasons Hotel, which is the main source of employment in the private sector and the major revenue earner on the island. ~~Adz:Right~~
Despite the challenge posed by the closure of Four Seasons, Parry said the island was able to maintain full employment. “In fact, due to the commencement of operations of the Brown Hill Communications Company in June of last year over 85 additional young persons are now employed. They work in a comfortable environment and there are certain worker benefits that are available for the first time in this sector of the economy. Early in the New Year, I have been informed that the company will be recruiting and training additional persons.”
The Premier said the Government of Nevis had commenced the exploration of geothermal energy with the assistance of the West Indies Power Company and “it is of the greatest significance to the people of Nevis”.
“The oil crisis is not over. We have been fortunate to see a drop in world oil prices as they went from US$147 per barrel in June last year to approximately US$40 per barrel at the end of 2008. This has resulted in a considerable reduction in the cost of gasoline, diesel and other fuels over the ensuing month. However, as the major countries of the world recover from difficult times the world price of oil will rise again. Therefore, the development of geothermal energy for electricity consumption will bring stability to electricity rates and will also ensure consistent and affordable rates for those of us who do business with NEVLEC,” the Premier said.
Listing the ways in which the geothermal initiative will benefit Nevis, Premier Parry said, “It will create additional jobs for our people in the construction phase, the production phase and it will attract other industries in search of cheap power to Nevis. It will not only reduce the cost of energy to NEVLEC, it will help the Government to save money and will attract revenue, especially from sales to other industries and overseas in the future.”
He said that during the month of December, a Government’s team comprised of the Legal Advisor, Patrice Nisbett; Financial Secretary Laurie Lawrence; Ernie Stapleton, Permanent Secretary in the Ministry of Communication, Works and Public Utilities; Cartwright Farrell, General Manager of NEVLEC; a representative from the Organization of American States; and advisors for the UK and Geothermal Association of the USA completed the terms and conditions for a contractual agreement with West Indies Power for the way forward.
“Those terms and conditions will be made public before the end of January. They cover royalties, equity participation of government, profit making, profit sharing and a fund to finance education, health and youth affairs on the island of Nevis. As a consequence, construction of the first geothermal plant will commence later this year with a view to provide the island of Nevis with Geothermal power in the first part of the year 2010,” he said.
Water Supply ~~Adz:Left~~
Premier Parry noted that in 2008 Nevis experienced one of the worst droughts in years and, in previous years, when the island was visited by severe drought water was rationed.
“In 2008 we experienced rationing in the month of May and June. With the assistance of the company, Bedrock Exploration and Development Technologies (BEAD), however, the Government and people of Nevis were in a position by July to have access to water 24 hours a day once again. Parts of Ramsbury, Hamilton, Bath, Brown Hill, Cole Hill and Brown Pasture, as well as Gingerland were relieved. The people of Nevis commended the Government for its initiative in developing two major wells, one in the Maddens area, and the other at Fothergills, for the comfort and satisfaction of all the people of Nevis. This year we are contracting with BEAD for an additional 500 000 gallons of water a day, not only to satisfy present consumption but to meet the expanding needs as more homes are built, tourism expands and new businesses commence operations,” the Premier said.
Construction & Tourism Industries
He predicted that the construction industry would remain vibrant in 2009.
“All indications point to its continuing vibrancy in 2009; Phase Two of the Nelson Spring Development led by Deon Daniel, a Nevisian entrepreneur, continues. Live Nevis and Paradise Palms located in Clifton’s Estate and Paradise Estate respectively will continue construction and so will the Four Seasons Estates. The Nevis Housing and Land Development Corporation will also be constructing homes around Nevis and therefore providing employment for contractors and persons who work in the construction sector. Other private homes will be under construction,” he said.
Premier Parry declared that the tourism industry would encounter challenges in 2009.
“We are fortunate that Nevis is positioned at the upper end of the industry. The impact of the recession in the USA will not be as damaging as some other islands, but nevertheless we are going to be impacted negatively. In addition to the closure of the Four Seasons Hotel, it is anticipated that the fall off in arrivals can be as high as 30 percent of regular years.
“In the meantime, please bear in mind that we all must be prudent in our use of money. It is advisable to avoid unnecessary debt at this time and to save. When the recession is over Tourism would once again be strong and those of us who work or depend on the industry, including the Government, will be better able to budget and organise with less stringency,” Parry said.
Another area of activity that may be negatively affected by the World Recession is Financial Services.
Parry said any downturn in business is reflected in a decline in the formation of business entities, but the NIA would continue to promote the industry since it is so vital to the people of Nevis.
“In 2009,” he said, “we are again faced by the threat from the OECD of a blacklist. We, the government, will work closely with the local providers, the Federal Government and other friendly organisations to strike the right balance to maintain the integrity of the financial services industry and to avoid the blacklist of the OECD countries.”
Cost of Living
Placing special emphasis on the cost of living, the Premier said, “In 2006 when the Nevis Reformation Party formed the Government, one of our major goals was to make life better for Nevisians. It was in our Manifesto. In the face of rising prices in 2007 and the first half of 2008, we have worked assiduously to protect the Nevisian consumer from the full impact of higher prices.
“The government has controlled the price of bread. A basket of food products including items such as milk, sardines and other products were identified and certain rates and duties were removed from these items. Civil servants were given increase over a period of January 2007 and 2008 amounting to a total of 12½ percent.
“In October 2008 a minimum wage was introduced at the initiative of the Federal Government. The Nevis Island Administration has ensured that gasoline prices have dropped from $17 per gallon to under $8 per gallon in a period of six months. The cost of diesel to the Power Plant has been reduced. This has been passed on to the people of Nevis in the form of a considerable reduction in the cost of electricity to householders.
“Today, I am announcing that from January 1, 2009 the price of Liquid Petroleum Gas will be reduced as follows: 100lb cylinder from $160 per cylinder to $140 per cylinder, 20lb cylinder from $35 to $30 per cylinder.”
Parry said the reduced prices of cooking gas, gasoline and electricity would create savings for every family, every driver and every user of propane gas on the island of Nevis.
“It is not surprising that a group of young men who hold discussions on a regular basis on Nevis have concluded that the Nevis Reformation Party Government is at its best in serving the ordinary folk of Nevis. Even as we seek to ease the burden of these trying times on our people, we seek to be more efficient and prudent in the conduct of our finances.
“The Ministry of Finance has done a great job in 2008. Property Taxes will now be paid by some expatriate home owners for the first time in the history of this island. Several banking institutions will be paying Corporate Taxes on Nevis for the first time in 2009. We anticipate by the end of the year all banking and financial institutions which make a profit by doing business on the island of Nevis will understand that they must return to the island and the people of Nevis what is due to them,” Parry said.
The Hon. Premier said from now on no subsidies would be given to any business on the island and LIME, formerly Cable and Wireless, would have to pay its dues to the Treasury.
“The government appreciates the great service Cable & Wireless has given to the people of Nevis. The Nevis Reformation Party-led Government has been discussing with Cable & Wireless the need to pay its dues to the Treasury on the Island of Nevis. We anticipate that in 2009 this matter will be put to rest. We will not subsidise Cable & Wireless or any other business operating on the island of Nevis any longer. All communication companies need to take immediate note.”