Ah Gon Bun Me Bed!

 

The topic was the IMF and the economic and financial situation in St. Kitts & Nevis.

I’ll share just one exchange that took place during the conversation.

One woman said:

“Me no kay wa nobaddy say. If me we-uk up one marning and hear dat me nice Prime Minister, Dr. Douglas, na ah rule dis country no mo, me gon bun me bed!”

To which the other woman sharply responded:

“If you nice Prime Minister continue to rule dis country, soon and wery soon you ain’t gun ha no bed to bun, ‘cause eida Courts gon come tek it back, or somebody gon tief it!”

That exchange goes to the core of the national debate on the economy of St. Kitts & Nevis.

There are four questions to be asked in this debate, and we must answer them honestly and objectively.

Question 1. How bad is the situation?

Question 2. How did we get here?

Question 3. How do we get out of it?

Question 4. Who will lead us out of it?

Now while both women might have agreed that the situation in St. Kitts & Nevis is very serious, the first one believed that the causes are totally external and beyond the control of Dr. Douglas, and that he has led the nation and managed the economy with exemplary skill, wisdom and altruism, while the other woman believed that Dr. Douglas’ leadership has been a major cause, even the major cause, of our economic and fiscal( not to mention other) woes.

So while the first woman believed that Dr. Douglas, and he alone, was the one to lead us out of the situation, the second woman disagreed totally.

Let me share some quotes from a statement by the Prime Minister, dated 24th June, 1996.

“ The major challenge facing the Ministry of Finance is to strengthen the Federation’s fiscal position through prudent fiscal policies in order to encourage increased  levels of savings that are critically needed to finance supporting infrastructure, which in turn should attract private investment and induce further economic growth.”

“…If too much of our resources is committed to the servicing of debt and the payment of salaries and wages, the ability of Government to carry out its mandate and upgrade the service it offers would be hamstrung by inadequate resources to procure the materials and equipment for the delivery of service.”

“The total debt of the Central Government now stands at $321.1 million or 52.1% of GDP. This includes external debt of $141.4 million, or 23% of GDP, and Domestic debt of $179.7 million, or 29.2% of GDP.”

“Domestic Debt is excessively high and places considerable strain on Central Government Finances. The size of the Domestic Debt incurred by the public sector has serious implications for private sector development”, …and “for growth, development and foreign exchange earnings”.

That was 15 years ago.

In his Budget Address given on 14th December,2010, ( see Page 35, Paragraph 100), the Prime Minister stated that at the end of 2009, Public Sector Debt stood at $2.6 billion, of which $0.8 billion( about 58% of GDP)was External Debt and $1.8 billion(128% of GDP) was Domestic Debt, and that the Debt-to-GDP Ratio was 186.2%.

If, as the Prime Minister said in June,1996, the Domestic debt was “excessively high” at $179.7 million or 29.2% of GDP, then what would he honestly say about it when it was TEN TIMES that in 2009?

Or about the figures today, Thursday 16th June, 2011, when the National Debt is about $3 billion, the Debt-to-GDP ratio is just under 200%, and the Domestic Debt is probably over $2 billion?

Dr. Douglas saw the warning signs as far back as 15 years ago, almost to the day, and he spoke accordingly. But judging from his own statements and on the information provided by himself, he has failed to practice what he preached.

This is not personal. It is reality. So here we are. Welcome to hell!

And you agree. Because a recent University of The West Indies’(UWI) poll shows that during the first quarter of 2011, consumers in the Federation were not only very unhappy, anxious and despairing, but were far more so than most of your counterparts elsewhere in CARICOM.

Specifically, one aspect of the poll revealed that only 8% of the people of St. Kitts and Nevis believed that the Government was doing a good job on the economy, and as many as 55%  said that the Government was doing a poor job.

That is, straight up, a vote of no confidence by you all in Dr. Douglas, who, of course, has been the Prime Minister for the past 16 years, Minister of Finance for all of that time less about a year and a half, Minister of Sustainable Development ever since the portfolio was introduced, and Minister of Lands for the past 7 years.

As the UWI poll relates to the conversation between the two women, it can be concluded that only 8% of you all would burn your beds if you were to wake up one morning with Dr. Douglas no longer Prime Minister. The rest of you would be fine.

And barring a miracle( which I am praying for), I do not see how the results for UWI’s second, third and fourth quarter polls will be any better.

Statistics like that  drive economic and social partners to collective, institutional, no-more-pussy-footing-around kind of action, and bring people to the street.

Sadly, however, they also tell the tale, in the case of St. Kitts & Nevis, of economic and social partners, and of a community as a whole, who by our own inaction, have tolerated, even encouraged, bad leadership, and who, as a result, have allowed the situation to get out of hand and reach this point of crisis.

Shame on us all.

Now in addition to the UWI information, and to all of the other compelling and daunting data that exists elsewhere, I consulted two professionals in finance and economic development.

Neither is a citizen or resident, and neither has a horse in any political or other race in this country.

I asked them one and the same question: How do you see things evolving for us over time?

Here is what one, who visited the Federation recently for a holiday and an assessment, said:

“Today we left St. Kitts by air. The air conditioning at the airport was not working and the travelers, mostly North Americans, were sweating like pigs in the Departure Lounge. They were very uncomfortable and angry, and many said that they would never return. Locals told me that the air condition system at your airport, like your electricity supply system on St. Kitts and your roads and other infrastructure and Government services, has been a problem for years. And I too noticed and  experienced some of that during my short stay. ”

“If you can’t maintain these things and, as a declared tourist destination you can’t take care of your customers( in addition to your own people), then either you’re in the wrong business, or you’re the wrong man for the business”

“The decision makers in St. Kitts & Nevis, both islands, are too preoccupied with political expediency, and not as focused as they need to be on commercial and economic analyses. That approach will inevitably produce the poor results which your country is now experiencing and which will cause great hardship to your people, maybe for the next ten or more years.”

“Your leaders introduce projects without calculating for maintenance or servicing, or for use or benefit to the community. They are not big on comprehensive cost-benefits analyses. In other words, they dwell on political returns, and in the process, build things that are quickly run down and ineffective, while your debt runs steeply up and becomes unmanageable.”

“Governments in your part of the world get into trouble either because of inadequate debt capacity to handle damage from natural disasters, or because of an indiscipline that manifests itself in regular instances of expenditure exceeding revenue, be it current or capital, or because of both”.

“Either way it comes down to governance. And in the case of the two islands, it is bad governance  that is driven more  by political self interest than by prudent fiscal, economic, commercial and social principles”.

In that context, he told me that an IMF lady had given the Prime Minister and others hell recently.

He further cautioned that the economic, social and political conditions here are ripe for a further brain drain of our best and brightest young, and not so young, people, and for an exodus of returning nationals, and other people, who have bought homes in the Federation, all of which will only worsen an already critical situation.

He ended by telling me:

“Your elections are airplane, Bacchanalian affairs, and the electoral processes are a mockery. Your population has not been sufficiently trained, technically and otherwise, to support a competitive economy in a difficult and fast-changing world, and they are too dependent on politicians and others.”

“That is unhealthy.”

“In addition, too many persons occupy positions of public trust who lack both the capability and the integrity to provide the level of service and transparency required to turn things around and turn your country into the Caribbean tiger that it could have been, and perhaps can still be.”

“I am not hopeful”.

Whew!

The other expert had this to say:

“Your country is in dire straits. And people who don’t realize that will do so over the next 3-12 months, the hard way.”

“Look for more of a tax load, more layoffs, and more stress, even some panic, in the private sector”.

“Your people are not prepared for this. Bad management,  and now a lack of resources, both from the revenue side and from the economic growth side. Getting out of this hole will be hellish.”

“Over  the next 1-3 years, Government will look to sell off large tracts of land to help pay down the debt. This will be difficult in terms of finding reputable buyers in the international market, especially with the global economy still not as firm as it could be. But it will be even more difficult because it creates a problem with the people of your tiny country who, already with a history of landlessness, will be marginalized and disenfranchised, and robbed of their patrimony”.

“Your country has a very serious leadership problem, and your Prime Minister has neither the ability nor the credibility to deliver it out of the situation.”

Double Whew!

Well if only 8% of you all are willing to burn your beds, then the rest of you really need to ‘man’ up and ‘woman’ up, and send your message.

During the weekend of 1-4 July, with the CARICOM Heads meeting here in St.Kitts, would be a good time to do so. Even before. Anytime is a good time to stand in your own cause.

Meanwhile, Operation Rescue is planning a public meeting for 28th or 29th June, probably at Greenlands Park. And listen out for our representative on WINN FM’s ‘Inside The News’ program on Saturday mornings at 11 o’clock. He or she will keep you posted.


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