PAM Leader – Mr. Lindsay Grant
“Today I am only summarizing what the IMF has published in its Article IV Consultation and Request for Stand-By Arrangement””Staff Report published as at September 2011.”
1. The world bodies are so worried about the collapse of our local banks that they have ordered the Government to place US$17.1 million into a Banking Sector Reserve Fund with the Eastern Caribbean Central Bank to provide support to any local bank which might have liquidity problems as a result of the mismanagement of our country by a Labour Government under Denzil Douglas.
2. Our people and our businesses have faced near 4% inflation and the out-look for 2011 is bleak, especially given the recent increases in electricity, Social Services Levy, Travel Tax and others causing everyone to be burdened.
3. The Government has had to engage an expensive Law firm from London to negotiate with organisations that we owe to try to get our debts rescheduled.
4. Our national debt is near EC$3 billion, cruising at 199% of GDP, of which 70% is domestic debt with National Bank buckling under the lion share.
5. The aim of all these new tax and other fiscal measures is to try to reduce the debt-to-GDP ratio from 200% to 162% by 2016, and hopefully to 60% by the year 2020 in line with internationally accepted standards. Our debt is the highest in the Caribbean and third highest in the world.
6. We have to hope for smooth sailing between now and 2020. If there is any little shock we would be in deep trouble and poverty would come to near 50% of our people.
7. Government is now in default to the tune of about $74.3 million on loans payable to regional and international organisations. At the same time Government realized a Budget Gap between 2008 and December, 2010, of EC$183 million.
8. Some of the conditions that we are to meet to satisfy the bailout by the IMF and possibly the Paris Club, include having to provide full and detailed accounts regularly and reporting regularly on all financial data of the public sector. Some data to be provided every month end include Budgetary Accounts, monthly Grants and Disbursements, Capital Expenditure, Principle and Interest payments on Domestic Debts, all issued cheque payments that are outstanding, arrears of Domestic Debt, Stock of External Debt and their repayment/repaid schedule of both.
9. The IMF is so worried about St. Kitts and Nevis that the Paris Club, an organisation of the world most powerful countries has been alerted about our dread circumstances and have been asked to prepare for a request from St. Kitts and Nevis as indications are that we need emergency care so that we do not bring down the Economic Union.