BASSETERRE, St. Kitts - PRESIDENT of the St. Kitts Nevis Chamber of Industry and Commerce (CIC) Damion Hobson has warned the Government not to rely solely on the Citizenship By Investment Programme for fiscal buoyancy, but to give support to other sectors that could stimulate economic growth.
Hobson was one of the presenters at today’s (Oct. 22) National Consultation on the Economy held at the St. Kitts Marriott under the theme “Changing Lives – A Fresh Start Towards Sustainable Development, Growth and Prosperity”.
He said the economy of St. Christopher and Nevis “needs to be re-balanced” with a key component of that process being fueling economic diversification.
“It is pellucid that it is no longer wise to embrace economic models that rely on one industry or pillar of economic progress. Instead, it may serve our cause better if diversity were to again find favour with any future models of economic development.”
Over the past number of years, the CBI, specifically the Sugar Industry Diversification Foundation, has been touted as a major capital-generating institution and much of its funds was used to finance various projects across the Federation.
Hobson said while the IMF indicated that the outlook for 2015-2016 is positive, vulnerabilities are directly linked to “changes in CBI flow”.
His advice then was that “we avoid the pitfall of relying on the Citizenship By Investment programme as the only solution to our problems.
“Please don’t misunderstand me, we hold the view that the CBI is critical to any strategy moving forward, but we must not be blinded by the huge inflows of the past and be led to ignore other economic sectors which need greater attention.
“In any new approach, a more innovative economy should be constructed with strong pillars of growth driven by a mixture and careful balance of tourism, agriculture, manufacturing, technology, services and the Citizenship By Investment programme. The continued development of our human capital and a robust small business sector are added ingredients that should complement the power of large and medium sized enterprises along the road to sustainable development, growth and prosperity.”
With the use of IMF figures, Hobson said it is projected that a sharp decline in the income of the CBI programme would take place over the next five years.
“As the following figures from the IMF would illustrate, last year (2014) was our best year, with a record $414 million in revenue, although only $283.3 million was initially projected. In comparison, in 2010 it was $171 million…2013 $391.3 million. The figures estimated for the following years ahead show a sharp decline…2015 $313.9 million, 2020 $159.4 million.
“In other words, if this trend is allowed to continue, we would register a drop of $254.6 million between 2014 and 2020, a six-year span. This is why we must act with urgency to address all attendant issues negatively affecting the programme.”
