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 Commentary By Melanius Alphonse

News Americas, CASTRIES, St. Lucia, Weds. Oct. 1, 2014: The downward spiral in the Saint Lucian economy is seriously hurting the bottom line of many businesses.

Now, that’s not just my point of view! Simply walk around the city of Castries, the towns and villages and communicate with citizens. Take a drive up and down the roadways and experience for yourself.

The circumstances that surround Cotton Bay Resort electricity disconnect are not remote and may very well serve as a probable case in point, or case study if you like, of the apparent breakdown in negotiating the current difficult economy environment in the country.

Although the reconnection of Cotton Bay Resort electricity within 48 hours is a remarkable about turn, this perhaps serves as a reminder of what citizens go through on a daily basis, thinking of which bills to pay and which ones to take a chance on and leave for a later date.

Dialing back to recent events, compliments of Prime Minister Dr Kenny Anthony’s priority to prematurely raise taxes of 15 percent VAT, the amendment to the Electricity Supply Act, for an increase rate to 50 cents per imperial gallon as a fee on all fuel purchased by Saint Lucia Electricity Services Limited (LUCELEC) from Buckeye, to raise EC$5.4 million dollars in revenue, inclusive of the timid approach to foreign direct investment (FDI), and the slow pace of trade agreements that would facilitate measures in sustainable trade, transportation and agricultural trade facilitation, seem overlooked as non essentials to the management structure of the economy.

This gives me cause to worry that, according to Prime Minister Dr Kenny Anthony, Saint Lucia is on the road to recovery, and that the island’s economic projections and outlooks are all positive. But knowing otherwise this is completely misplaced, and in some circles called a bluff – simply designed to create behaviour expectation.

To further the argument, permit me to reference two articles: Kenny Anthony’s kumbaya budget needs unions as capital underwriters, and Shock and effect of frantic governance,

“There can be no good news on the horizon, as imports continue to rise and particularly the food import bill to levels of 50% to 60% of gross domestic product (GDP). This will only increase the trade deficit and putting more pressure on the current account, and public debt of 73.6%, when it should be in the comfort zone of 55% or less.”

And consider this from the Budget Statement 2014: “Our fiscal problem will not go away just by growing our economy. The stark reality is that just to maintain the current debt levels and not allow it to increase any further, our analysis indicates that we would have to grow by an average of 7 percent per year. If we were to reduce our debt-to-GDP ratio to the prudential 60 percent level by the year 2025, we would have to grow at an average of 10.5 percent per year from now until 2025.”

Further, the concern is that the action by LUCELEC to disconnect Cotton Bay Resort electricity supply may serve as a sign that other properties may be on the brink of experiencing the same fate for non-payment of bills in arrears, which in turn is an opportunity for deeper dialogue to review the Tourism Incentive Act, in an effort to stabilize the tourism industry’s operating cost for utilities, among other matters to enhance the tourism product.

Tourism is Saint Lucia’s main foreign exchange earner and employment driver. As a result, in an environment of fiscal deficit and high public debt, the island’s tourism industry can ill afford a negative about turn on its image and subsequent fortunes.

On September 25, Director of Tourism Louis Lewis said statistics at the end of August 2014 show that there has been a 6.6 percent increase in tourist arrivals here. This is against a 4 percent increase for 2013, despite the challenges facing the global tourism industry.

“The performance is satisfactory, especially since the island is competing with countries with much larger budgets and there are no concessions and other incentives.” ~ Louis Lewis

“While underscoring the importance of regional tourism, Lewis stated that the cost of inter-regional travel is still high which is a major setback for many islands. The tourism director explained that a consumer, who may want to travel to a sister Caribbean island, could pay the same cost for travel to Miami or New York. As a result, travelers would prefer to travel to the United States.” (Louis Lewis (

It is clear that Prime Minister Dr Kenny Anthony’s disconnect with the private sector, in critical areas such as renewable energy, including natural gas, and the lack of focus to reduce the cost of trade (locally and regional), lower agriculture production cost, transportation facilitation and the government’s lack of will to speed up structural reforms to make it more efficient to do business, is destroying the prerequisite for economic growth, job creation and poverty reduction.

The other is the non-existence of a market strategy that modern business executives can buy into that is inclusive of a development program for the next four to eight years, at least, in areas such as manufacturing, telecommunication, infrastructure development, financial services and agriculture/agribusiness.

A significant part of Saint Lucia’s performance in the future can come from trade and investment agreements to help the country generate productive jobs and economic growth. But yet, this remains a source of obscurity and, to most, an injustice for the delay in negotiating, away from the misery this course of inaction is delivering on the people of Saint Lucia.

Meanwhile the lust for power and pillage takes precedence in broad daylight and even in the House of Assembly. This is what the schedule for Tuesday, September 16, 2014, papers to be laid outlined.

BE IT RESOLVED that Parliament authorizes the Minister for Finance to guarantee the amount of:

EC$5,814,758.70 for the purpose of financing the Bocage to Sunbuilt and Entrepot to Independence City Roads Rehabilitation Works;

EC$12,240,104.80 for the purpose of financing the Resurfacing of the Alan Bousquet Highway (Union to Babonneau) Project;

EC$10,549,804.10 for the purpose of financing the Anse Ger Desruisseaux Road Rehabilitation Works;

EC$4,818,892.73 for the purpose of the completion of the La Dig (Mocha) and Deville Bridge Reconstruction Project;

EC$4,361,486.96 for the purpose of financing the completion of the Park Estate Drainage Project;

EC$32,224,598.45 for the purpose of financing the East Coast Road Rehabilitation Project

At that rate, the next economic surprise may need a daily dose of political narcotic to calm ideological conflicts. This is why, the political priority and the prospect of economic recovery that requires financial commitment is lacking focus. What is needed for development is new and focused investment.

But then, the reality is, if you can’t manage, you can’t measure, much less identify essential input to formulate and prioritize, new drivers for economic growth.

This is crucial for Saint Lucia to broaden its economic and social opportunities for citizens to rise above the poverty level and into the middle class, and to reduce unemployment, particularly among the younger demographic.

So listening to Prime Minister Dr Kenny Anthony articulating his optimism that Saint Lucia’s economic projections and outlook remain positive, showing positive signs of growth, is at best troublesome.

It would be amazing to believe that a change in circumstance is happening, to achieve growth, with better opportunities for all, and that good order is taking shape. But that’s hardly the case. And even, for the benefit of being optimistic, then this would be identifiable, a pretentious character restraint.

The larger point is that, in contrast to Prime Minister Dr Kenny Anthony’s delusional projected outlook and the action that comes behind these pronouncements, the reality is: real job creation is disappearing; real wages are falling and, for that matter, wage reduction is on the rise; and middle class incomes and business are disappearing.

Above all, to make the turn to economic recovery, to reduce Saint Lucia’s fiscal deficit, increase FDI and to excite citizens into local investment, good public and private investment conditions are needed to make projects viable. Likewise, a country where freedom, democracy and human rights are respected, and not revert to putting politics ahead of the rule of law.

Saint Lucia needs order, predictability, national security and a leader we can trust, to provide political and economic stability. But regrettable, Prime Minister Dr Kenny Anthony’s mental disconnect seems the order of the day…in sync with disconnection enforcement by utility service providers that are occurrences to scrutinize.

Melanius Alphonse is a management and development consultant. He is an advocate for community development, social justice, economic freedom and equality; the Lucian People’s Movement (LPM) critic on youth initiative, infrastructure, economic and business development. He can be reached at ma*******@ro****.com   


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