IS our Prime Minister’s preferred legacy the fact that he did not take Saint Lucia to the IMF or that he did not keep the promise of “Better Days” to the people?
Dr. Antony recently defended his decision not to follow in the footsteps of some regional governments in refusing take the island into a programme of austerity measures with the Washington-based International Monetary Fund (IMF). He made the statement while wrapping up debate in the Parliament on the 2015-2016 Appropriation Bill.
Making specific reference to Grenada which is grappling with IMF involvement at the moment, Anthony remarked: “I am proud, I am happy that I did not take this country (St. Lucia) to the IMF”. According to Dr. Anthony, he was advised, that the only way the economic problems of St. Lucia could be dealt with was to go to the IMF, but he opted not to go that route. If the Prime Minister was advised by his technocrats, presumably, to take the island’s economic woes to the IMF for some IMF tonic, then it certainly was not lost on the Prime Minister that in the process a severe blow would have been dealt to his image and that of his party. And that he wasn’t having.
A government, that while occupying opposition seats, offered “Better Days” will hardly feel comfortable going to the IMF for answers. Quite apart from saving face for his cabinet and party, the Prime Minister may well have committed political suicide in the process. Going to the IMF would obliterate the legacy he has so carefully pieced together over his fifteen years or so at the forefront of St Lucian politics.
The question is: if the International Monetary Fund is not the option, although it was prescribed by some experts as being the only “option”, then what is the way forward in addressing the severe fiscal situation that the island is in?
The St. Lucia budget indicated that the Gross Domestic Product (GDP) contracted by an estimated 0.7% or negative growth of minus 2.7%. What is the Kennynomics cure for this state of affairs? (Don’t hold your breath).
There are certain harsh “adjustments” that seem to suggest that the government of the day is subscribing to austerity measures – both implicitly and explicitly, in order to address the island’s four major challenges as pointed out by the Prime Minister himself. The prescriptions, though not IMF missives, may well be similar in its intent.
In that vein, last year the Prime Minister addressed the nation on what can be considered to be perhaps its non–IMF options. In an address entitled: Facing the Options, delivered in June 2014, one year ago, he said:
“When I delivered my 2014 Budget Statement in Parliament on Tuesday, May 13th., I set out to explain, as clearly as I could, the challenges confronting our country. If you recall, I stated then that we are facing four fundamental challenges, namely: (1) low economic growth rates, (2) persistently high unemployment, (3) high vulnerability to economic and natural shocks, and (4) fiscal deficits and high debt levels. In that budget statement, I also stated the measures that our government was taking to address these issues”.
The Labour Government’s proposals to reduce the fiscal deficit have been unapologetically unforgiving and are not very different from what obtains in Grenada. The “not going to the IMF line” is just a sweetener that the Prime Minister’s public relations mavens have once again come up with. Dr. Anthony himself said:
“These adjustments were possible primarily because we undertook a strict streamlining of capital expenditure. We reduced spending on goods and services, utilities, supplies and materials, and communication, in addition to decreasing transfers and subsidies to statutory boards and other government agencies. There was also a major adjustment of $26.8 million in Capital Expenditure.” The Value Added Tax was implemented and now new tax exemptions and revenue measures that tighten the noose around the salaries of the citizenry will be implemented in this budget cycle.
In the context of the recent budget announcements which appear to have left all disgruntled except minibus drivers, and given Saint Lucia’s current realities, it is almost factitious that the Prime Minister and his cabinet expect the public to look around the region to find comfort. Among the austerity measures implemented by the Keith Mitchell government in St. George’s is a doubling of the property tax, a wage freeze over a three-year period for civil servants, lowering of the income tax threshold to bring in more people in the net, as well as huge increases in user fees charged by the State. It is necessary for Dr. Anthony to ask the people in Saint Lucia whether they feel at all far removed from Grenada’s realities, or any IMF linked island. Perhaps it is only he and his chosen few who see things differently.
Dr. Kenny Anthony’s refusal to turn to the IMF has nothing to do with his being a compassionate government. It is about his legacy. His true motive is that he does not want such a blemish on his legacy. However, the Lambirds Academy matter may not be as kind to his legacy nor the legacy of this government as a whole. Amidst the making of Dr. Anthony’s Legacy there is also the making up of the people’s mind to act decisively, soon; because you can fool some of the people some of the time, but you cannot fool all the people all of the time, for they have seen the light.
By Alexis B. Montgomery