CDB Gives St. Kitts – Nevis A Good Economic Report

Basseterre, St. Kitts – Nevis, May 31st 2007

Economic growth in St. Kitts and Nevis rose slightly in 2006 to 4.4 percent from 4.1 percent in 2005, driven mainly by a surge in construction, strong gains in agricultural and manufacturing output, and continued growth in tourism and related services.

According to the Barbados-based Caribbean Development Bank in its 2006 Report released at the Bank’s Board of Governors Meeting in Caracas, the Venezuelan capital, value-added in the tourism and manufacturing sectors increased by over 10 percent and by over 21 percent in the construction sector.

Fiscal performance strengthened in 2006, owing mainly to strong revenue performance.”Continued administrative improvements at both the Customs and Inland Revenue Departments together, with policy measures that included the introduction of an electricity surcharge, a higher rate for the social services levy, and higher excise duties on alcohol and tobacco accounted for higher revenue collections,” said CDB, adding: “Current expenditure was contained, and these factors contributed a small recurrent account surplus in 2006, compared with a small deficit in 2005. Lower net capital spending resulted in a smaller overall deficit in 2006, compared with 2005.”

CDB reported that agricultural production increased by 3.8 percent from the level in 2005, falling slightly short of reversing the decline of 3.9 percent which had occurred in 2005.“Contributing to the turnaround was an increase in the number of crop farmers and in the land area under cultivation, a longer growing season, improved pest and disease management, and better weather conditions” in St.  Kitts and Nevis said the Report.

Increased output levels were recorded for most crops (including carrots, tomatoes, onions, sweet peppers, potatoes, peanuts, and watermelons) except yams and cabbages, with a 10 percent decline in the production of cabbage, resulting from pest management difficulties.

Peanut production in St. Kitts and Nevis more than doubled from 25,000 kg to 56,000 kg, due mainly to production by former sugar workers.

In the livestock sub-sector, output declined, partly as a result of a 30 percent decline in beef production to 60,000 kg that was not offset by a 7 percent increase to 74,000 kg in pork production. Small ruminant production rose marginally, reflecting increases in the production of mutton from sheep and goats.

“The livestock industry continued to be plagued by several constraints including insufficient lands for livestock farming, the high incidence of canine attacks, an increasing incidence of praedial larceny, and insufficient commercialisation of farming operations,” said the Caribbean Development Bank.

CDB also reported that fish production rose in 2006 with higher catch of pelagic such as snapper, dolphin, tuna, and conch; and further improvement in the output of marine products is expected in 2007 following the completion of the Old Road Fisheries Complex, funded by the Government of Japan, at the end of 2006.

Agricultural production was helped during the year by a EC$400,000 FAO financed project to establish new small-farming and livestock enterprises, as part of the adaptation to the closure of the sugar industry.  As part to the support to livestock farmers, the project included improvements to the abattoir.In the area of tourism, value-added in tourism, as by hotels and restaurants, grew by an estimated at 11.8 percent in 2006, compared with 10.8 percent in 2005, for the fourth successive year of growth.

The expansion reflected continued expansion in the country’s tourism markets, primarily the US, improved airlift, and the effects of ongoing marketing and promotion. The authorities continued to develop a niche for meeting and conferences, and have focused effort to promote the destination for weddings, diving, and cultural events.

The increase in flights to St. Kitts and Nevis also contributed to a rise in stayover arrivals. In contrast, cruiseship and yacht arrivals declined during 2006, as the number of cruiseship calls declined. Value-added in manufacturing grew by an estimated 10.3 percent in 2006 compared with 7.6 percent in 2005, despite the absence of sugar manufacturing during 2006. Preliminary estimates indicate higher output of electrical and electronic components (in enclave manufacturing operations), concrete products, and beverages.

Value-added in the construction sector increased by an estimated 21. 2 percent in 2006 compared with growth of 7.8 percent in 2005 and 9.4 percent in 2004 respectively.

Ongoing implementation of a number of projects, some large, contributed to output growth in the sector; these included the Calypso Bay condominium project; the Cable Bay Resort; development of Warner Park (sporting complex for hosting CWC 2007 matches; shopping facilities at Port Zante; the Fisheries Complex at Old Road; water and electricity improvement projects; an airport expansion project; Beaumont Park; the West Basseterre By-Pass road; the Kittitian Hill; the super-low-income housing project by the National Housing Corporation; the Basic Education Project; and residential and other smaller commercial properties in both islands.

Leave a Comment