“The Financial Secretary has advised that our Fiscal Returns available up to February 2019 reflect that our Country is in surplus again” declares PM Timothy Harris . This is certainly good news for the federation.
PM Harris outlined at his monthly Press Conference for April stated “Our Recurrent Balance, Our Overall Balance and Primary Balance are all in surplus. These surpluses provide clear and irrefutable evidence as to our very good fiscal health and prudent management of our economy. Our accounts are done in accordance with international classifications and standards. Hence they are comparable with data of any sophisticated Country. It is the same data set used by the Eastern Caribbean Central Bank (ECCB), Caribbean Development Bank (CDB) and the International Monetary Fund (IMF).”
Economic growth in St. Kitts and Nevis increased in 2018 for the 5th time in a row. PM Harris used the opportunity during the Press Conference to indicate that “ Over the 5 year period 2010 to 2014 the economy had declined in 2010, 2011, 2012 by -3.8, -1.9, -0.9 according to the IMF Press Release 14/138 dated March 24, 2014. Even with growth rates at 6.6 percent and 5.1 percent in 2013 and 2014 respectively, over that 5 year period the economy grew by a mere 1.2 percent. According to the CDB in 2018, growth hinged mainly on the tourism industry. There was a significant increase in airlift, additional room stock, and strong growth in cruise ship arrivals at the start of the year. The transport sector also displayed robust growth, while construction activity decelerated after a strong 2017 performance.”
The Prime Minister and Minister of Finance also commented on a very positive CDB Economic review which was issued in March. The Review stated among other things that St.Kitts-Nevis led the OECS as far as it’s Primary Balance to Public Sector ratio.
“The 2018 St Kitts and Nevis Country Economic Review issued on March 14, 2019 by CDB indicates that St. Kitts and Nevis ranked 1st in the OECS with respect to its Primary Balance and Public Sector Debt ratio. Within CARICOM Member States, St. Kitts and Nevis Primary Balance was the best in the region at 7.1 percent of GDP. As stated earlier real GDP growth for St. Kitts and Nevis was estimated at 2.50%. This puts us ahead of 8 of the 14 Member States of CARICOM. Public Sector Debt for St. Kitts and Nevis was recorded at 58.20% of GDP, making us the best performance in the OECS. The Federation ranked 2nd in the CARICOM region with international reserves providing 8 months of import coverage. This impressive performance in the region must be seen against the international benchmark of 3 months and is much better than the international standard,” stated Prime Minister and Minister of Finance Dr. Hon Timothy Harris .
It must be noted that the Debt to GDP Ratio of St.Kitts-Nevis stood at 200% in 2011. This staggering debt was the 2nd highest in the world and resulted in the intervention of the IMF and then the subsequent implementation of the highest VAT Tax in the OECS at 17%
The Caribbean Development Bank was very optimistic about the country’s economic future. It says “CDB projects an increase in growth to 3.0% in 2019, mainly on the back of expanding construction and tourism activities. Construction activity is expected to accelerate with ongoing public infrastructure investments at the St. Kitts airport and seaport, and on each of the islands’ main roads. Tourism activity is expected to rise following a further increase in airlift, including a new direct flight from Minneapolis. The hotels and restaurants sector and the transport sector will be the main beneficiaries of this expansion”. I should point out that the CDB growth estimate was a preliminary one and ECCB’s estimate for 2018 is 3.1 percent.
Continued growth will be sustained by several public sector projects including:
• Old Road Bay Rehabilitation
• Old Road Fisheries Project
• Our Housing Projects being done by NHC, Development Bank and others that are subsidized through the FIRST
• 2nd Cruise Pier
• Resurfacing of our runways at R. L. Bradshaw International Airport