Prime Minister Dr Timothy Harris speaking in Parliament
BASSETERRE, St Kitts -- St Kitts and Nevis Prime Minister Dr Timothy Harris announced in the National Assembly on Wednesday that his government has decided to create a growth and resilience fund as one of the fiscal policies it will implement in 2017.
Harris, who is also the minister of finance, explained that such fiscal policies would help to accelerate growth and build resilience in St Kitts and Nevis.
The theme of Harris’ 185-minute Budget Address for the 2017 Financial Year, which he delivered before a large cross-section of stakeholders comprising representatives of the church, the diplomatic corps, and the public and private sectors, was Working Together – Accelerating Growth and Building Resilience.
The prime minister said that, during the last International Monetary Fund (IMF) Article IV Consultation in St Kitts and Nevis, which ended on May 3, 2016, “the idea of establishing a mechanism for managing the savings which the government has generated as a result of the overall surpluses that were achieved to date” was discussed.
Harris added that, in accordance with the government’s medium-term fiscal framework, the administration decided to establish the growth and resilience fund.
“The medium-term macroeconomic objective of this strategy is to use the accumulated savings to build policy buffers against exogenous shocks that could result from hurricanes, downturns in key tourism markets and adverse developments related to the CBI [Citizenship-by-Investment] inflows,” Harris said.
This assessment mirrors the opinion of the IMF, which in its July 26, 2016, press release titled IMF Executive Board Concludes 2016 Article IV Consultation with St Kitts and Nevis said that “Establishing a ‘growth and resilience fund’ can help preserve the accumulated savings from the CBI program, while providing a contingency buffer for future shocks, such as costly natural disasters.”
The prime minister also noted that “Another objective [of the growth and resilience fund] is to maintain adequate fiscal space to support the implementation of a robust public sector investment programme (PSIP) while limiting the accumulation of public sector debt.”
Harris said his administration intends to consult with the private sector and other key stakeholders in order “to shape the design and governance arrangements for the [growth and resilience] fund.”