By Caribbean News Now contributor
BASSETERRE, St Kitts – Prime Minister and Minister of Finance, Dr Timothy Harris, said on Tuesday, that it is the fourth month in a row and the fifth year in succession that the fiscal performance of St Kitts and Nevis continues on a strong and positive path under his Team Unity-led administration, yet conceals Article IV Consultation Report completed by a visiting IMF Mission headed by Dr Arnold Mc Intyre, adding, “With all the mouth and man he thinks he is, let him reverse the Land for Debt Swap.”
According to Dr Harris:
“Prudent fiscal operations of the Federal government have resulted in record surpluses on recurrent account, the overall balance and primary balance – the three most significant indicators used to assess government performance internationally. In the context of St Kitts and Nevis, we are doing very well on each of them.
“Put another way, we were not only surpassing our budget for 2019 but when we compare our actual receipts in 2019 to date compared to 2018 we were outshining and outdoing ourselves.
“The government expenditures were primarily to support personnel emoluments such as salaries, wages, allowances, pension and gratuities, goods and services, interest payments, transfers and capital expenditure,” said the prime minister, who also commended the accounting officers and the ministry of finance “for containing recurrent expenditure to less than one percent departure from the budget.”
“The country’s debt to GDP ratio declined even further to 56.4 percent for the period ending March 2019. At the end of March 2018, the debt stood at 62.3 percent and at 58 percent as at December 2018. The reduction in the debt-to-GDP ratio since December 2018 was attributed to the reduction in the debt stock by $67.6 million by March 2019 with projected growth in economic activities for the year 2019.”
In contrast, Dr Harris argued that under the former administration, the country’s public debt ballooned to an estimated US$1.05 billion or about 200 percent of GDP. (Source of figures: IMF Country Report No. 11/270)
“St Kitts and Nevis, under the discredited former regime, chalked up a debt which was the second worse in the world,” Dr Harris noted, and that it was for this reason that shortly after assuming office in February 2015, his administration took the decision to pay off the remaining debt to the IMF (International Monetary Fund) to tune of $117 million.
However, former prime minister and minister of finance and current Leader of the opposition, Dr Denzil Douglas continues to challenge Dr Harris to simply release the IMF report adding, “With all the mouth and man he thinks he is, let him reverse the Land for Debt Swap.”
“It will do the country good, if Timothy Harris will release the last Article IV Consultation Report completed by a visiting IMF Mission headed by Dr Arnold Mc Intyre.
“We do not accept nor believe anything that Harris says regarding the present state of the country’s finances as his word cannot be trusted.”
“I am not surprised that Harris would want to lay claim to the reduction of the National Debt for honestly what can he lay claim to after four years. The truth be told he was never a strategic thinker. Investors complain to me that he turns them off because of his classless behaviour,” Dr Douglas said.
Dr Douglas noted that during the campaign leading up to the general elections of 2010 the National debt became a potential football for the then opposition: “I told the country then that the Labour administration under my leadership will deal with the National debt once and for all, including legislation to ensure that the debt stays within a certain limit.”
The Appropriation (2003) Act, 2002 properly documented the seriously damage inflicted on the economy by five hurricanes between 1995 and 2000.
“It was during that same period that we lost access to concessionary funding as we were graduated by the World Bank. Add to that, we lost preferential treatment for our sugar export, so that industry under the then minister (of agriculture) Harris, accumulated massive debt.
“The situation was compounded and then there was the financial crisis that Small Developing States had to endure. During those difficult times we still had to provide our people with a decent standard of living which we did. So yes, the country’s debt to GDP increased of which Harris was an active participant,” Dr Douglas added.
“My administration was able to achieve success in bringing the National Debt down, firstly due to respect that existed between the minister of finance and the technocrats of the ministry of finance under able and capable financial secretaries with whom I work. One of which the World Bank requested secondment.
Dr Douglas further noted that a critical component of the success of the home-grown debt reduction strategy was the Land for Debt Swap which the Harris regime promised to reverse.
“Once the ‘Land for Debt Swap Agreement’ was complete as it was very critical to the exercise, I was able in addressing the 2013 National consultation on the economy on Thursday 17th October 2013, to inform the audience that we were well on target in bringing our debt to international standard, with the Land for Debt Swap in 2013 the debt was about 100 percent of GDP. I indicated that by 2014/2015 the debt ratio will be further reduced to 89 percent of GDP and will reach to 60 percent of GDP threshold way before 2020.”
Nevertheless, Dr Harris’ refusal to allow the IMF to release Article IV Consultation Report means the true economic and financial state of St Kitts and Nevis remains in the dark and off limits to the people of St Kitts and Nevis, local businesses and investors.
“Local and foreign investors can only have confidence in the economy and its administration when sound financial and economic data are made available by reputable financial and economic institutions,” Dr Douglas said.
“Our economy between 2010 to 2015 under my leadership was the leading economy in the OECS and our people flourished,” he said. The St Kitts and Nevis economy grew over six percent in 2013 and 2014 respectively after challenging years brought on by the international economic and financial crisis.
“We created jobs for our young people. We expanded the green energy sector and attracted billions worth in foreign investments,” Dr Douglas reiterated. “We built over 5,000 affordable homes for families and we increased Social Security from EC$300 million when we went into office to EC$1.2 billion when we left,” Dr Douglas continued.
“Under the NEXTGEN SKN leadership, I plan to position the Federation as the cutting edge of several emerging medical, environmental, cryptocurrency, fantasy sport and energy industries so that our people can create wealth for themselves under our prosperity agenda,” Dr Douglas said.