By L.K. Hewlett

St. Kitts Reporter

Over 300 participants turned up to the annual National Consultation on the Economy held at the St. Kitts Marriott Resort last week.

Ministers of government from both St. Kitts and Nevis were in attendance at the significant event along with members of the private and public sectors and representatives from all four of the nation’s high schools and the Clarence Fitzroy Bryant College.

One of the key topics discussed by the Federation’s Prime Minister Hon. Denzil Douglas was his administrations plans to reduce the federation’s increasing National debt, which at last report was stated to be in excess of US 3 billion dollars.

“The fiscal situation remains challenging, particularly in light of the high cost of fuel, high debt and the associated interest costs including the cost of servicing the debt of the SSMC and the critical environmental and social activities of the SSMC that the government must now undertake.

“I assure you that St. Kitts and Nevis is on track and the fiscal stabilisation programme. The government is still steadfastly implementing its programme to bring debt to acceptable levels over the medium term.”

PM Douglas also told the large gathering that the fiscal balances continue to perform creditably and was 3.4 percent of GDP at the end 2006, while it is anticipated that the balance at the end of 2007 will meet the target of 2.5 percent.

This, he explained, was due to a marked improvement in revenue collection as a result of administrative reforms in both the Customs and Inland Revenue Departments of the Ministry of Finance.

According to the nation’s leader and Minister of Finance, expenditure restraint has also contributed to the improved fiscal performance.  He said that wages and salaries as a percentage of GDP has been declining since 2002 and it is projected that this will stand at 9.4 percent of GDP at the end of 2007, moving from 11.9 percent of GDP in 2002, a drop of more than two percentage points.

Dr. Douglas said his St. Kitts – Nevis Labour Party Government continues its efforts in prioritising Capital projects with the aim of focusing on those which will bring financial and economic returns. He added that a drop in the overall balance to -5.0 percent of GDP in no way signals that one can afford to relax now.

PM Douglas said that expenditure restraint remains a focused challenge as his administration tackles the fiscal situation.