The nation elects a government and entrusts it to manage the economy. Included in this activity are the creation of jobs and the reduction of unemployment. The provision of essential services such as education, health, security and social welfare. Poverty reduction and eventual eradication is a priority. The creation of an investment climate with fiscal and investment incentives for nationals in the private sector to invest in our economy is a priority. These all contribute to economic growth, progress and development. In this Federation, the present government came into office in 1995 with an economy which was growing at six percent per annum. The national debt was EC$212 million. The debt service ratio was 3.73% of GDP (the total value of goods and services produced in a country in a year) and 5% of recurrent revenue. By 2008 the national debt amounted to EC$3,000 million dollars or 3 billion dollars. Each individual, i.e. man, woman and child in the Federation owes $62,500.00. The debt service ratio is 200% of GDP and rising. St. Kitts and Nevis has the dubious classification as being the second most heavily indebted nation in the world. The prime minister at the jamboree which was held at Warner Park on July 3, 2009 planted a question on the national debt. His reply to the question sent a chill over the whole nation. He stated that the people know his views on the size and composition of the national debt. This view is embellished with expletives about his anatomy. He concluded that “We paying it.”The governor of the Central Bank of Trinidad and Tobago expressed concern about the size of the national debt in the Federation. The Caribbean Development Bank in its Annual Economic Review on St. Kitts & Nevis 2007 states “The high level of public indebtedness continues to place a significant burden on the budget in terms of debt servicing obligations. It retards the growth of the economy”. The debt service obligation is EC$188 million and rising. This accounts for 45 cents out of every dollar of revenue collected. Together with salaries and wages for government employees and ministers this amounts to 77 cents. Only 23 cents out of every dollar annually is left to provide for health, education, security and social services. The rapid growth and size of the national debt is a matter for serious concern and is not to be treated flippantly as though it is of no relevance. It is the result of poor economic and financial planning. The government embarked on reckless spending and borrowing programs. These include the La Vallee Golf Course on which EC$116.83 million has been spent. The project was never intended to be completed. The Pubic Works road program was shelved and replaced by a Barbadian owned construction company which was given a free hand to build roads with hundreds of millions of dollars borrowed at excessive rates of interest from three banks in Trinidad. The ratio of debt to gross domestic product (GDP) should have been carefully monitored to ensure that it did not exceed a sustainable level. (75% of GDP). Renegotiation of these rates downwards after outcries from International Development Agencies cost the Federation EC$500,000.00 (Estimates 2006). Vast sums were spent on housing programs and budget deficits were accumulated without examining their long term effects on this economy. ($653 million by 2007: Director of Audit Report). The economy of this country is not in a healthy condition. The government has a narrow revenue base. It is based on import duties. The downturn in national economic activity will result in a drastic reduction in revenue accruing to the government. This is estimated to fall by 20% or $119.2 million in 2009. Projected Government expenditure will result in a BUDGET DEFICIT of EC$81.4 million. The government has acquired a triple C credit rating internationally. This means that no reputable financial institution will lend it any money. Thus in order to finance this shortfall it will resort to raiding the Social Security Fund. Servicing the debt will mean that essential public and social services will have to delayed or abandoned. In this economic recession, with looming unemployment the negative economic effects will reverberate throughout our society. Poverty and unemployment create crime in every society St. Kitts and Nevis is no exception. It must be borne in mind that remittances from abroad have fallen by an estimated $8 million; the inflows from foreign direct investment and the minimal contribution to GDP by the tourism sector have evaporated. The Minister of Finance in the 2009 Budget Address the Honourable Minister of Finance stated “The United Nations Human Development report 2007/2008 ranked St. Kitts & Nevis 54 out of 177 countries worldwide”. However he neglected to indicate that in 2000 the Federation ranked 51. In the 2008/2009 report the Federation now ranks 60. This reflects a continued decline in the level of human and social welfare in this Nation. The Human Development Index (HDI) is an attempt to measure basic human and social achievement in a country. The measure can be used to make comparisons between Nations. HDI indicates whether people lead a long and healthy life, are educated and knowledgeable and enjoy a decent standard of living. The HDI examines the average condition of all people in a country; distributional inequalities for various groups of society are calculated separately. In common language this Nation is not doing very well. The Nation desperately needs leadership with the intellect and vision to combine the entrepreneurial, professional and academic talents which are abundant in this Nation. Dr. Douglas has by his own admission outlined the lack of ability in the present team under his style of leadership to achieve this basic but essential objective.
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