GRENADA 2001 BUDGET SPEECH
HON. ANTHONY BOATSWAIN
Minister of Finance
To The House of Representatives
January 12, 2001
“Towards a Knowledge-Based Economy with Equity”
THE EXTERNAL ECONOMIC ENVIRONMENT
REVIEW OF GRENADA’S ECONOMIC PERFORMANCE
MEDIUM TERM PROSPECTS
ESTIMATES OF REVENUE & EXPENDITURE FOR 2001
CAPITAL EXPENDITURE PROGRAMME FOR 2001
PRIVATE SECTOR INVESTMENTS
IMPROVING THE REGULATORY FRAMEWORK
POVERTY ALLEVIATION MEASURES
A - Knowledge Enhancement Measures
B - Improving the Regulatory Framework
C - Grenada: Medium Term Projections
Grenada: Fiscal Summary
Mr. Speaker, I stand to move the following Motion, standing
in my name which reads as follows: “whereas it is necessary to provide for the
State of Grenada for the year 2001 by means of an Appropriation Act, be it
resolved that the Estimates of Expenditure for the year 2001 be approved”.
Mr. Speaker, permit me to commence the 2001 Budget
Presentation by offering praise to the Almighty God, the Creator of the
Universe, and the Giver of “every good and every perfect gift”, for his guidance
and strength in the past fiscal year.
Allow me also to take this opportunity to extend to every
Grenadian, at home and abroad, the very best wishes for the New Year.
Mr. Speaker, I also wish to place on record my
appreciation of Prime Minister, Dr. the Honourable Keith Mitchell, other
members of Cabinet and indeed, the entire Government for their support in what
has been a challenging year of mixed fortunes. There were many
accomplishments, for which we are justifiably proud. However, there were
also a few shortcomings for which we must take appropriate corrective actions.
Mr. Speaker, it seems like only a few short months ago, that
I stood in this Honourable House to deliver the 2000 Budget.
In actuality, that was more than one year ago, and although
this is a very short time in historical terms, I do believe it is an appropriate
time to review the “first mile” of our journey into the New Millennium.
It would be recalled that in his Millennium Address
to our Nation on December 31, 1999, our Prime Minister, Dr. the Hon. Keith
Mitchell, articulated his vision for our beloved Country and designated the
first decade of the New Millennium as the Knowledge Enhancement Decade.
In keeping with this vision, the theme for the 2001 Budget Presentation is
“Towards a Knowledge-based Economy with Equity”.
Mr. Speaker, the rapid rise of the global knowledge
economy has created a knowledge gap. It is now widely accepted that the
key determinant of the competitiveness in small countries such as ours, is the
narrowing of this knowledge gap.
In this regard, several steps have been taken by this New National Party (NNP)
administration to reposition our economy, to take advantage of this new emerging
situation. These include, the successful computerization of our Secondary
Schools; the training of approximately one thousand (1000) Grenadians in
Computer Literacy and the Introduction of Educational Software Programmes in
selected subjects in our secondary schools.
As a result of these and other initiatives Grenada was able to attract a number
of information-based industries and telemarketing operations.
Mr. Speaker, a major undertaking planned for this year, will be the launching of
a broad-based Information Communication Technology Council, and the preparation
of an Information Communication Technology Plan. Additionally, plans are
well advanced to fully computerize all of our primary schools, as well as all
Government Ministries and Departments. The overall objective is to involve
all of our citizens in this Technological Revolution.
Mr. Speaker, I now turn to the external economic environment.
2.0 THE EXTERNAL
Mr. Speaker, the most adverse development in the world
economy during the past year was the sharp rise in the price of oil on the world
market. Crude oil prices rose to an all-time high of US$38 per barrel in
September 2000. This represented a significant shock to the world economy,
paralleled only by the oil shocks of 1973 and 1979.
The rise in oil prices was directly attributed to the
deliberate action of the Organisation of Petroleum Exporting Countries (OPEC) to
keep production relatively low over an extended period of time even in the face
of increased demand from the US and European economies.
Activities in the international financial services sector
continued to grow but not without difficulty. Several countries including
Grenada found themselves listed by the OECD as tax havens.
Most of the year therefore, was spent improving and upgrading
the legal and regulatory framework for this promising sector, given its
importance in the economic diversification thrust of our Region.
On a brighter note, 2000 may well be regarded as the year of
deregulation for the telecommunications industry. The OECS, under the OECS
Telecommunications Reform Project supported by the World Bank, established the
Eastern Caribbean Telecommunications Authority (ECTEL) to regulate the provision
of telecommunications services in the sub-region. This is a most important
development with positive far-reaching implications for our Region’s external
competitiveness, and Grenada’s goal to be a knowledge-based economy.
Mr. Speaker, I now turn to developments in our domestic
REVIEW OF GRENADA’S ECONOMIC PERFORMANCE FOR 2000
Mr. Speaker, for the period 1995-1999, the local economy grew at an average rate
of 7% compared to a 2.3% average growth rate for the OECS as a whole.
Preliminary data indicate that economic activity in Grenada remained buoyant in
2000, with real growth in GDP estimated at 6 percent. This was above the 5
percent target for the year. Growth in the domestic economy was sustained
primarily by increased expansion in the construction and tourism sectors, as
well as in the traditional and non-traditional agricultural sector.
this regard, Government’s commitment to the development of the Agricultural
Sector continued to pay dividends. Banana production was up by 35.6% to
1.7 million pounds reflecting the continued success in the implementation of the
Banana Rehabilitation Plan.
Production of cocoa increased by 23 percent to 2.6 million pounds, consequently,
the value of export earnings increased from $3.8 million to $4.7 million.
Earnings from export of nutmegs and mace increased to EC$39.1 million.
This was primarily due to an increase in export price from $3.75 per pound to
$4.37 per pound.
There was also an increase in the volume of fish landed to 3.9 million pounds,
with export earnings of approximately $9.6 million.
Speaker, the resurgence of the fishing industry is encouraging after the
difficulties experienced with the “fish kills” in 1999.
the Tourism Sector, stay over visitors increased by 9.4%, to 137,048.
Export of manufactured goods increased by 11.9 percent, from $64.3 million in
1999 to $72.0 million in 2000. Principal export items included electronic
components, flour, wheat bran and animal feed.
In the construction sector, the number of building permits issued by the Land
Development Control Authority increased by 9.2% from 411 permits issued in 1999
to 449 issued in 2000. Building material sales increased by 6.4% to
The performance of the construction sector was also boosted by the significant
level of public sector infrastructural activities that took place in the year
2000. Total public sector investment amounted to $158 million,
approximately 40.7 percent more that in 1999. Major infrastructural
projects implemented in 2000 included Emergency Works Project, the Western Main
Road Pipeline Project, and the Carriacou Multi-project.
Prices and Wages
The rate of inflation as measured by the Consumer Price Index
was 2.2 percent in 2000 compared to 0.5 percent in 1999.
This slight increase was attributed to higher prices for fuel
and oil-based products, resulting from the global increase in oil prices, a
condition over which we have no control.
Mr. Speaker, it must also be remembered that the increase in
prices took place in the last quarter of the year, which means that for the nine
months of 2000 domestic prices were relatively low.
On the other hand, it must be noted that it was during the
same period of the price increase that Government paid out approximately $4.4
million in back pay to established and non-established workers in the Public
Service. This increase in income impacted positively on the real wages of
workers, thereby reducing the negative effects of the increase in oil prices on
the purchasing power of consumers.
Mr. Speaker, data from the Central Statistical Office
indicate that the national unemployment level dropped from 12.5% at the end of
December 1999 to 11% at the end of December 2000.
In addition, data from the National Insurance Scheme revealed
that in 2000 a total of 4,624 persons registered with the Scheme for the first
time. This was substantially higher than the number of newly registered
employees for 1999. To the extent that some of these newly registered
employees represent individuals seeking employment for the first time, it is
obvious that there was a substantial increase in employment generation in 2000.
This point is further demonstrated, when one analyses the age
distribution of the newly registered employees. In this regard, 25 percent
of the newly registered employees were under the age of 20, while 35 percent
were in the age group 20-24 years. This means that many of our young
school leavers are absorbing most of the newly created jobs in our economy.
Mr. Speaker, this is a most satisfying development for any
government or country.
Mr. Speaker, you would recall, during my previous
budget presentation I announced that this Government is working assiduously to
reduce unemployment to single-digit figures within two years. The current
estimates put unemployment at 11%. Moreover, there have been several major
developments since this estimate. It is, therefore, likely that the
national unemployment rate is now below 10%.
Mr. Speaker, personal loans for the purchase of land and
homes increased by 14.2% from EC$279.9 million in 1999 to EC$319.5 million in
2000. Bank deposits increased by 16.5% to $1.2 billion largely influenced
by savings and time deposits. Time deposits increased by 14.4% moving from
$300.0 million to $342.8 million, while savings deposits increased by 13.0%
moving from $537.0 million to $606.8 million in the year under review. These are
all symptoms of a growing economy!
In terms of the Utilities, international telephone
minutes increased by 49.2% from 6.6 million minutes to 9.9 million minutes.
The quantity of electricity generated increased by 12% from 116.7 million
Kilowatts per hour to 131.3 million Kilowatts per hour (Kwh) with electricity
consumption recording a 13.5% increase relative to 1999. Water production
increased by 5.7% to 2.6 billion gallons.
Government Fiscal Operations (Public Finances)
Mr. Speaker, Government’s revenue collections in 2000
amounted to$313.7 million or 98% of the budgeted estimate for 2000.
This represents an increase of 15.8% over 1999. Current expenditure
totalled $266.6 million or 98.2% of the 2000 estimate.
Consequently, for fiscal year 2000, Government achieved a
current account surplus of $47.1 million compared with $50.4 million in 1999.
I am pleased to report that fiscal year 2000 marked the
fourth consecutive year that Government has recorded a current account surplus
on its fiscal operations. This surplus of $47.1million or 5.4% of GDP
compares favourably with our fiscal target of a current account surplus of at
least 3.5% of GDP.
Capital expenditure of $158 million in 2000,
was financed by the entire current account surplus of $51.4 million, capital
revenue of $3.7 million, external grants of $35 million and external loans of
MEDIUM TERM PROSPECTS
Mr. Speaker, according to IMF
projections, global growth is expected to be sustained at about 4%.
However, a slow-down in the US economy, and prolonged high oil prices, could
adversely affect this projection.
On the domestic front, prospects
for the Grenadian economy in 2001 and into the medium term are encouraging.
In fact, both the Eastern Caribbean Central Bank (ECCB) and the International
Monetary Fund (IMF) project strong economic performance with a growth rate of
5.0 percent, which is above both the CARICOM and World averages.
This growth projection is based, in part, on continued
expansion activities in the construction sector where several major public and
private sector projects are also due to come on stream.
Mr. Speaker, improved performance is also expected
from the agricultural and tourism sectors with growth rates of 4% and 7%
The contribution of the manufacturing sector to
Gross Domestic Product is expected to increase over the medium term with the
expansion of industrial operations at Frequente, and subsequently, the
establishment of a number of industrial centres throughout the State.
Mr. Speaker, it is important to note that in 1995, the
contribution of the manufacturing sector to GDP was 6.6% compared to 7.9% in
Over the past three years, we have witnessed significant
growth in this sector to the extent that in 2000, the value of manufactured
exports was $79.1 million.
Mr. Speaker, under this Administration, the manufacturing
sector has come alive and is now playing an increasingly important role in our
economy both in terms of employment and exports. The efforts of several of
our local manufacturing companies must be highly commended.
With the relative peace and political stability that
characterise the present economic climate, a major objective of Government is to
sustain the economic growth achieved over the last three years. It is with
this in mind that the 2001 Estimates were prepared.
I now turn to the Estimates of Revenue and Expenditure for
Fiscal year 2001
2001 ESTIMATES OF REVENUE AND
Mr. Speaker, the 2001 Budget seeks to address not only
Government’s plans and programmes for the current year, but more importantly, as
articulated in my Budget Presentation of 2000 and the Medium Term Economic
Strategy Paper 2000-2002, to build on the platform established for sustained
growth and poverty eradication.
In furtherance of these
objectives, the 2001 Budget provides for a total expenditure of $525.2 million
distributed as follows:
Mr. Speaker, of the $332.8 million in
recurrent expenditure, 45 percent will be used for the financing of salaries,
wages, pensions, and gratuities.
Recurrent revenue for 2001 is estimated at $337.2 million,
this includes $166.1 million from Customs and Excise and $123.5 million from the
Inland Revenue Department.
A current account surplus of $48.9 million (less
amortisation) is therefore projected.
The following is a breakdown of Capital Expenditure
by major sectors:
Percentage of total
Youth, Sports and
Mr. Speaker, of the $192.4 million budgeted for capital
expenditure, $113.6 million or 59 percent will come from external sources, while
the remaining $78. 8 million or 41% will be financed from local revenues. Of the
$113.6 million in external financing, $51.7 million represents grant financing
while $61.9 million will be funded through loans.
Speaker, I now move to the Capital Expenditure Programme for 2001.
EXPENDITURE PROGRAMME FOR 2001
Communications and Works
Mr. Speaker, Government recognises that a well-developed economic infrastructure
is necessary to promote domestic economic activity and attract and optimise
foreign investment. Never before in the history of this Country have so
many infrastructure works been commissioned, undertaken and completed – major
roads, concrete roads, air and sea ports expansion, stadium, and ministerial
complex to name a few. These are investments for our generation and the
Mr. Speaker, it is, therefore, not surprising, that for this and other reasons,
the Grenadian economy has been the fastest-growing economy in the OECS over the
past three years.
Speaker, the development of infrastructure will remain a high priority.
Several major projects will continue, or commence in 2001. Consequently,
$80 million have been allocated to infrastructural
development in 2001 as compared to the $73 million spent in 2000.
The Ministry of Works must be highly commended for the
improved rate of implementation that approximated 80% last year.
The major infrastructural projects for 2001 will include:
Road Maintenance Programme - $14 million
Emergency Works (Disaster Rehabilitation) - $9.0 million
Secondary Roads - $10.0 million
Carriacou Multi-Project - $9.7 million
ROC/GOG Multi-Project - $7.0 million
6. Water Supply - $5.5
Agriculture and Fisheries
Mr. Speaker, the structure of Grenada’s economy is changing on account of the
rapid growth of the Services sector. In 1990, the Services Sector
accounted for 53.2% of GDP. By the end of 2000, it accounted for
approximately 70%. In contrast, Agriculture accounted for 46% of GDP in
1960, compared with 13% in 1990 and 8% by the end of 2000.
Speaker, the relative decline of Agriculture’s share of GDP is a normal
occurrence in a developing country. Grenada is no exception.
Nonetheless, the agriculture sector will continue to be an important pillar of
our economy for several socio-economic reasons.
Not the least among these reasons
are the urgent need for domestic food security and the need for
strong linkages with our growing tourism sector.
In this regard, the broad goal of
Government is to place the sector on a solid commercial and scientific footing
thereby increasing production and productivity, and at the same time making the
sector more attractive to a younger generation of farmers.. As a
consequence, the budgetary provision for the year 2001 is $22.8 million, an
increase of 17% over last year’s allocation of $19.5 million.
Tourism and Civil Aviation
Speaker, tourism continues to be a lead growth sector in our Economy. In
support of sustaining this growth, the sum of $13.4 million is earmarked.
This includes $10.0 million to the Grenada Board of Tourism. Mr. Speaker,
you may recall that in my Budget Presentation last year, Government gave an
undertaking to give the Grenada Board of Tourism, $10.0 million each year for
the next three years. I am pleased to note, that in excess of $12 million
dollars were disbursed to the Board of Tourism as promised.
Speaker, this is a Government of its word. Indeed, this Government has
placed considerably more money at the disposal of the Board of Tourism for
marketing and promotion than any other Administration.
As a demonstration of Government’s commitment to support the
revitalisation of the small hotels, I am pleased to advise that an allocation of
$250,000 has been made for the provision of technical assistance to these small
hotels in 2001.
Government is very mindful of the importance of the cruise tourism sub-sector to
the livelihoods of many of our People. A major initiative has been
launched to enhance this sub-sector. Important steps are being taken to
enhance conditions, services, and facilities for cruise tourists. These
include the construction and expansion of airport and seaport facilities, the
upgrading of tourism sites throughout the State, and the implementation of urban
renewal projects for the towns of St. George and Grenville.
Education and Human Resource Development
Mr. Speaker, the development
of our human resources constitutes the single most important element of our
national development. In the context of an ever-changing global
environment, it is imperative that our education system reflects our current
national development priorities. To this end, the Ministry of
Education undertook the preparation of a 10-year strategic plan for the
education system during the year 2000. The Education Plan is almost
complete, having benefited from extensive consultations from a wide-range of
A new development for the T.A. Marryshow
Community College (T.A.M.C.C) in 2001 will be the introduction of university
courses in Arts, Science and Business.
These courses will be offered during the day and
evening thereby catering for persons who are working but would like to
further their education and obtain a university degree.
This is a major turning point
in our education system because this facility makes it possible for our
people to gain a tertiary education at a far lower cost than they would have
to pay if they had to travel abroad.
Efforts will be intensified
in the area of technical and vocational education. The aim is to
create a cadre of skilled and semi-skilled professionals able to contribute
to national development. In this regard, a new skills-training centre
in Seamoon St. Andrew will cater for the youth of St. Andrew's and St.
This training centre will
provide our youth with the opportunity to develop a wide range of vocational
skills so that they can be readily absorbed in the dynamic job market or
Information technology and
computer studies will continue to figure prominently in human resource
development in 2001 with the National Employment and Skills Training
Programme. It is our intention to make access to a personal computer
available to every single Grenadian.
As a consequence, an
aggressive and intensive training scheme will be pursued in workplaces,
schools, communities, and villages. These programmes will empower our
youth to take advantage of the tremendous opportunities that exist in high
tech, knowledge-based industries.
At present, the rate of tax
on personal computers is 5% whereas the rate of tax on computers for
commercial use is 10%. However, the rates on computer parts and
accessories are higher. Government will move swiftly to review
the taxes on computer and computer accessories with a view to further
reductions. We hope this move will encourage individual and corporate
citizens to be part of the Digital Age.
In order to facilitate this
massive effort to provide training and educational opportunities, increased
resources are needed. Accordingly, $19.8 million have been allocated in the
2001 Budget for capital projects to be undertaken within the Educational
Sector, an increase of 22% over the actual expenditure of $16.2 million in
2000. Of course, this is in addition to the recurrent expenditure of
$55 million for the Ministry of Education.
Mr. Speaker, Government will intensify its
Health Sector Reform Programme this year. In this regard, the
completion of the New Hospital Development Programme and the
decentralization of the management of Hospital Services will remain the top
During the past year, the issue of HIV/AIDS has
risen to high prominence on the international development agenda. In
terms of the per capita incidence of HIV/AIDS, the Caribbean is currently
second only to sub-Saharan Africa. This is a most disturbing position!
Consequently, the Ministry of Health will prepare a National Strategy to
address the formidable threat posed by HIV/AIDS to our national development
Indeed, all our efforts in education and human
resource development will be undermined if urgent steps are not taken to
deal with this epidemic.
Additionally, the cost of medical care for
HIV/AIDS patients is unbelievably high and will place a financial burden on
both the families of the patients, as well as the Government.
Work on a National Health Plan will continue and
be accelerated this year. It is expected that the issue of a National
Health Insurance Scheme will be revisited with a view to identifying some
feasible options for this Scheme.
Mr. Speaker, there has undoubtedly been
noticeable improvement in the extent and quality of solid waste disposal
services throughout Grenada, Carriacou and Petit Martinique.
Government will continue to collaborate with the Grenada Solid Waste
Authority to ensure proper management of waste disposal.
The recent completion of the sanitary landfills
at Perseverance in Grenada and at Dumfries in Carriacou will serve as a
major boost to this endeavour. For 2001, the Ministry of Health has
been allocated $15.5 million for capital expenditure.
Mr. Speaker, shelter is a
basic human necessity. Accordingly, our Government is fully committed
improving access to housing opportunities for middle and low-income
households and also improving the quality of the existing, and the new
The first phase of the
Beausejour Housing Project is now completed with the construction of
twenty-eight (28) units. All of the utilities including water,
electricity, and telephone have been installed. Recently, work
commenced on the road leading to the housing development and it is expected
that this road will be completed in the first half of this year.
Government has also completed
the first phase of the Diamond Housing Project in St. Mark’s with the
completion of fifteen (15) units. Several of these units have
already been sold and the owners will begin occupancy this month.
Furthermore, Government has
given its approval for the Dunfermline Housing Project in St. Andrew’s.
This Project will commence this month. This Development will construct
one hundred (100) units of two bedroom and three bedrooms houses with roads,
electricity, water and a bridge on fifteen (15) acres of land. This
Project is estimated to cost $12.5 million and should be completed within
fourteen (14) months from the start-up date.
The National Insurance Scheme
is planning to develop its 77 acres of land in Lauriston, Carriacou into a
housing development. Plans are well on stream to award contracts for
the infrastructural works.
Government through the
Housing Authority of Grenada is collaborating with a Cuban firm to construct
low income houses costing between $30,000 and $40,000 dollars. A model
house from Cuba will soon be erected at the Sandino Complex of the Housing
Authority, for viewing, by interested persons.
I am pleased to note that on October 05, 2000,
the Physical Planning Unit of the Ministry of Finance and Planning, with
assistance from the Organisation of American States, launched the National
Building Code and Planning Guidelines. This new Code will be piloted
for a period of one year, reviewed, amended if necessary, and then become
The Code aims to ensure that disaster-resistant
building standards are instituted as a matter of law. This will
undoubtedly assist all of our citizens, but particularly the poor since they
are the most vulnerable when a natural disaster occurs.
6.7 Youth and Sports
the long-term success of a Nation resides in its future generations.
Consequently, youth development is of paramount importance in our
Government is pleased to note that the National
Youth Policy has been completed and that its implementation will commence
Mr. Speaker, the Stadium has generated renewed
interest in sport at all levels of society and is motivating our athletes to
improve their performances. However, Government’s
commitment to youth development goes way beyond
the construction of the National Stadium.
With the kind assistance of the Government of
the Republic of China, the Rural Sports Facilities Project will commence
This most important project includes the
upgrading of playing facilities at Cuthbert Peters Park in St. John’s,
Progress Park in St. Andrew’s, La Sagesse in St. David’s, Hillsborough in
Carriacou and Alston George Park in St. Mark’s.
Additionally, Government, through the National
Lottery Authority will continue to upgrade the infrastructure for sport and
recreation throughout the Country.
I am pleased to note that the Ministry of Sports
has put together a National Sports Development Programme with emphasis on
key sports such as cricket, football, netball, athletics and swimming among
other sporting disciplines.
Mr. Speaker, as we demonstrated recently with
the incentives to our successful cricketers and coach, our Government
support for sports does not stop at infrastructural development. We
are prepared to offer tangible benefits to our athletes who represent this
country or region, and excel.
Carriacou and Petit Martinique
Mr. Speaker, the pace and
extent of development in Carriacou and Petit Martinique under this
Administration is unparalleled in the history of our Country.
I am pleased to announce that
the Carriacou Multi-Project has finally commenced after a lengthy delay that
included seeking additional financing from the Caribbean Development Bank
for a section of road extensively damaged by Hurricane Lenny. It is
expected that at least $10 million dollars will be spent on this Project
including the rebuilding of the Petite Martinique Jetty and the resurfacing
of at least twelve (12) kilometres of road.
This year, the provision of
capital expenditure for other projects has increased by 50% from $2.4
million to $3.6 million. Some of the projects include the Cultural and
Sporting Centre, the ROC/GOG Multi-Project, the Hillsborough Welcome Centre
and the Carriacou Integrated Land Use Forestry Development Project.
7.0 PRIVATE SECTOR
Mr. Speaker, this
Administration recognises the Private Sector as the principal engine to
propel our development in the New Millennium. As a consequence, we are
prepared to support private sector initiative as best as we can. Our
courageous position on the Egmont Development Project demonstrates our
commitment to supporting the private sector, particularly the local private
sector, in meaningful and substantial investments.
The Grenada Industrial
Development Corporation (GIDC) reports that forty-four (44) investment
proposals were received and reviewed by the Corporation during the past year
with a potential investment value of over $98.5 million. Most of these
proposals are for tourism developments.
The hotel accommodation plant
was enhanced with the major redevelopment of the Spice Island Beach Resort
and the construction of the La Luna Hotel. Government wishes to
commend the owners of these properties for these investments in the
Mr. Speaker, the year 2000
also witnessed expansion to one of Grenada’s most modern yacht marinas.
Grenada Marine, located at St. David’s Harbour, is 100% locally owned,
accordingly, the local entrepreneur must be commended.
Mr. Speaker, I am pleased to
announce that infrastructural works have finally started on the first phase
of the long-waited Ritz Carlton Project.
Several other hotel projects
are in the pipeline for this year including the Cinnamon Hill Development
(250 rooms), the Grand Anse Resort (250 rooms) and the expansion of the
Grenada Grand Beach Resort (54 rooms).
Mr. Speaker, a tourism
development to be known as the Levera Beach Bungalow Hotel Project is also
planned. The Project will construct 300 bungalows at Bathway in St.
Patrick’s and will employ 400 people during construction. This Project
is estimated to cost US$90 million and is likely to commence later this
year. Mr. Speaker, this Project should not be confused with the Levera
Hotel Project which is actively being considered.
Mr. Speaker, only recently a
French investor purchased Calivigny Island from a Grenadian family.
The Investor intends to construct villas for an upmarket clientele. This
Project will start later this year.
Mr. Speaker, plans are well
advanced for the construction of a multi-million dollar cruise ship terminal
in St. George’s by a Switzerland-based group of investors. Work on the
construction of the St. George’s Bus Terminus will commence shortly, while
work has already started on the Sauteurs Bus Terminus.
Mr. Speaker, August 2000,
witnessed the unofficial opening of the Spiceland Mall, the initiative of a
This new facility offers a
considerable range of shopping options for both our local residents and
tourists. The family concerned ought to be applauded for
this significant investment and the jobs created.
In the area of manufacturing,
approximately EC$6.1 million was invested in the expansion of the
award-winning W&W Electronics – an electronics assembly plant at Frequente.
The expansion of W&W Electronics is expected to generate an additional seven
hundred (700) jobs.
Mr. Speaker, in keeping with our stated goal of
agricultural diversification, plans are well underway for the establishment
of a Multi-Agro-processing Plant in St. David’s.
This facility will purchase
local fruits and vegetables and convert them into semi-processed and
processed goods. The Plant will be a major boost to the agricultural
sector and will give farmers another option for their produce. The
facility will be owned and operated by a local entrepreneur. Mindful
of the critical importance of this Project, Government will assist the local
entrepreneur by guaranteeing part of the financing.
IMPROVING THE REGULATORY FRAMEWORK
Mr. Speaker, our Government fundamentally
believes that the private sector, both local and foreign, should play a lead
role in the generation of activity in our economy. In this regard, the
critical role of Government is to provide the enabling environment for the
private sector to grow and flourish. The elements of this enabling
environment include sound economic policies, incentives and appropriate
I now wish to highlight some important areas of
our economy that will benefit from a stronger regulatory framework.
International Financial Services
Mr. Speaker, the development of the
International Financial Services Sector in Grenada is a conscious response
to the fulfillment of our special development needs. These include the
need to diversify our economic base, enhance national revenue, and create
meaningful and quality employment opportunities for our people.
In pursuit of these objectives, Grenada launched
its international financial services sector in 1996.
Recognising, however, that a well functioning,
stable, and well regulated financial environment is vital to the development
of the sector, the Government of Grenada, in January 2000, established the
Grenada International Financial Services Authority (GIFSA) - a statutory
body - charged with the principal responsibility of Supervising and
Regulating the activities of the International Financial Services Sector.
Notwithstanding our efforts, the problems that
subsequently surfaced with one of the major offshore banks, demonstrated
that there were some weaknesses in our regulatory framework.
Mr. Speaker, I wish to make it abundantly clear
that Government is currently commissioning a full and thorough
investigation, utilizing international expert assistance. It is hoped
that this investigation will provide information on possible illegalities in
the operations of this Bank and such information will be used to bring those
responsible for these illegal actions, to justice.
The primary concern of this Government is to
ensure that a thorough and independent investigation is completed and that
funds of legitimate depositors are recovered.
By so doing, Grenada’s good name as an
international financial services center will be preserved.
Additionally, Government will, in the next few
days, make an application to the court for the international accounting firm
of PriceWaterhouseCoopers to be appointed as the liquidator of First
International Bank. This court-appointed liquidator will track the
assets of the Bank both local and overseas, and distribute the proceeds of
these assets to depositors and creditors as prescribed under the Companies
In order to safeguard our jurisdiction from
similar occurrences in the future, Government has embarked upon a number of
measures designed to strengthen the regulatory and supervisory
capacity of GIFSA. These include:
Review of all existing legislations governing that sector, with a
view to strengthening them. This review should be completed in time
for the Financial Action Task Force Review scheduled for March 2001.
The appointment of a National Drug Crime and Money Laundering
Committee to deal with drug, crime and money laundering. This
committee is already in place and headed by the Minister of Legal Affairs.
The appointment of an Anti-Money Laundering Supervisory Authority as
provided for in the Money Laundering (Prevention) Act 1999. This
Authority will accept and investigate reports on suspicious financial
transactions, money laundering and other forms of financial crime.
This Authority is already in place and is chaired by the National Security
Regular training of the staff of GIFSA with assistance from external
agencies such as the Caribbean Financial Action Task Force (CFATF) and the
International Monetary Fund (IMF).
The establishment of a bank supervision department and the appointment of a
bank supervisor to ensure that all offshore banks and other financial
institutions are properly capitalized, and operate within the norms of that
sector. Banks that are not properly capitalized will face the prospect
of having their licenses revoked. A bank supervisor has already been
The separation of the promotional activities from the regulatory activities
of GIFSA. The Grenada Industrial Development Corporation (GIDC) will
undertake the promotional activities.
Mr. Speaker, the promotion of industrial peace
and tranquility throughout the State is of great importance to this
Government. As a result, this year, the Department of Labour will be
strengthened to better serve all of its clients.
Mr. Speaker, I am pleased to note that the
Labour Code inclusive of the Employment Act and the Labour Relations Act
came into force during 2000. The passage of this Legislation
represents a major advance for workers’ rights in this Country.
Mr. Speaker, the White Paper currently in
circulation arose out of this Government’s commitment to consultation as
well as the apparent lack of goodwill on the part of some trade unions that
appear not to regard the importance of a stable industrial climate. I
call on all our social partners to put the Country first.
Mr. Speaker, the Department of Labour will be
strengthened to function as an employment agency. To this end, a
Labour Market Information System will be developed with on-line access for
both employers and potential employees.
8.3 National Security
Mr. Speaker, Government is mindful of the menace
posed to the stability of Grenada and the rest of the Caribbean by the
transshipment and illegal trafficking of drugs and money laundering.
Government intends to collaborate very closely with regional and
international organizations to combat these challenges. External
assistance will be sought for the procurement of equipment and training for
the Police Force and the Coast Guard.
As part of its commitment to raise the
capability of the Police Force, a new Police Headquarters will be built,
several police stations refurbished, and a Crime Hotline will be
The Computerisation of the Police Force that
started with criminal data records has now been extended to immigration.
Very soon, all police stations will be linked through a computer network
thus improving the speed of crime prevention and detection. An
Automated Identification and Fingerprinting system is also planned.
Mr. Speaker, in light of all
the developments, recently completed, planned or ongoing, the issue of
physical and environmental protection is a high priority for this
During 2000, work was
completed on both a National Biodiversity Plan of Action and a National
Adaptation to Climate Change Strategy. Implementation of some of these
recommendations will begin this year.
At present, a National
Physical Development Plan is being prepared. Later this month, work
will commence on the drafting of a comprehensive Physical Planning and
Development Control Bill with accompanying regulations.
Mr. Speaker, in October last
year, the Ministry of Foreign Affairs convened a Meeting of Heads of
Missions, Ambassadors at Large and Honorary Consuls with a view to
strengthening Grenada’s presence in the global environment. As a
result, new policies for Protocol and the Appointment of Honorary Consuls
have since been approved, while a new Foreign Policy Document will be
presented for Cabinet’s approval shortly.
Moreover, a Foreign Policy
Bureau has been established to coordinate Grenada’s representation at
Mr. Speaker, this
Administration remains committed to the principle of smaller government and
a more efficient Public Service.
To this end, Government
intends to actively pursue the policy of commercialisation by contracting
out certain services. In 2001, several major government departments
will benefit from this policy. These include:
The statutorisation of the T.A. Marryshow Community
The statutorisation of the Government Printery; and
The conversion of the Hospital Services into an executive agency.
The policy of
commercialisation has now been successfully implemented in the Ministry of
We have all witnessed
substantial improvement in the quality of the services offered to
Government, by some of these former workers who are now under contract.
Mr. Speaker, the policy of
commercialisation is more than just reducing the size of the Public Service
and improving levels of service to the public. It is about unleashing
entrepreneurial spirit of our
people. In the area of cleaning of government buildings, for example,
we now have several co-operatives offering cleaning services to Government
Mr. Speaker, the success of
these cooperatives has been a revelation about what can be accomplished if
people are given a chance to work for themselves. Mr. Speaker, not
only has the quality of the service improved, but also, these cooperatives
have been able to successfully bid for jobs in the private sector.
Mr. Speaker, I am pleased to
announce to this Honourable House, that there are no new taxes in this
This is consistent with our
philosophy that higher taxes are inimical to economic growth, and can cause
undue hardship to the most disadvantaged groups in our society.
The significant improvement in revenue intake
projected for this fiscal year, therefore, will depend on four major
increased buoyancy in the economy
greater efficiency in the collection of revenue
higher levels of voluntary compliance on the part of some taxpayers.
greater reliance on non tax source of revenues, for example, user
fees and licences.
Mr. Speaker as a result of the factors
mentioned, both the Customs and Excise Department and Inland Revenue
Department met and surpassed their revenue targets for 2000 by collecting
$157.5 million, and $113.5 million respectively. It is projected that
both departments will achieve their respective targets of $166.1 million and
$123.5 million in 2001.
Notwithstanding the strong revenue performance,
it must be noted that significant leakages and non-compliance in revenue
collection still exist.
Mr. Speaker, in this age of
declining foreign aid and concessionary financing, greater reliance must be
placed on domestic resources to finance our development needs.
In this regard, Mr. Speaker,
Government will implement further measures to ensure that there is greater
compliance with our tax laws, and that other forms of leakages such
as under-invoicing and smuggling are further reduced.
I am pleased to note that
there has been a substantial increase in fines and interest payments for
false declarations and late payment of taxes respectively.
This trend clearly
demonstrates that our enforcement mechanisms are functioning, and these will
be maintained. I trust that our taxpayers will see the wisdom of
paying sooner rather than later.
Mr. Speaker, as I had
promised, last year, the Audit Unit was re-established in the Inland Revenue
Department and two accountants were recruited to complement the tax
inspectors assigned to this Unit. This Unit has been receiving
training from an experienced tax adviser and will not be merely reviewing
the returns of taxpayers but, where appropriate, will undertake field audits
to verify financial statements and tax returns.
During the past year,
Government sought and obtained technical assistance from the International
Monetary Fund to review some of its major tax legislations. This
Mission also benefited from the inputs of the private sector. It is
our intention to proceed with the implementation of some of the
recommendations of this Mission during this fiscal year, particularly as
they relate to the upgrading of tax legislations.
Mr. Speaker, based on the foregoing measures, we
expect to see greater voluntary compliance with our various Tax Laws and,
ultimately, improved revenue collection.
I now turn to the specific
fiscal measures for 2001.
Strengthened Property Tax
Mr. Speaker, Government is
committed to a property tax regime that is stable, equitable, transparent
and responsive to economic growth. Given the buoyancy of the
construction industry, the Property Tax is assuming increasing significance
in Government’s range of inland taxes. In 2000, property tax raised
$4.8 million compared with the target of $4.5 million. We believe that
the relatively low rates of property tax have contributed to improved
compliance. However, there is room for improvement.
To this end, the Property Tax
Act of 1997 will be amended to require demand notices to be issued by way of
regular mail as opposed to registered mail. We expect this move to
significantly improve voluntary compliance and at the same time, reduce the
cost of administration.
As a consequence of the valuation exercise
conducted during 2000, over 5,200 new properties were registered and will be
liable to pay property tax in 2001. It is expected that property tax
will generate at least $6.0 million in year 2001.
Reduced Fuel Prices
Mr. Speaker, as I had
indicated earlier, the sharp rise of oil prices on the world market has
resulted in an increase in the local prices of both fuel and electricity.
During 2000, Government
initially allowed the local price to increase to reflect international
market developments. However, when the fuel prices showed no sign of
falling, Government was forced to step in and set a ceiling of $7.95 per
gallon for the price of gasoline. Without this intervention, the local
price of gasoline would have been approximately $8.50 per gallon.
Mindful of the significance
of fuel in the economy, and cognisant of the plight of the poor, Government
took the bold decision in December 2000 to reduce the price of gasoline from
$7.95 per gallon to $7.50 per gallon by further reducing the taxes on this
Mr. Speaker, Government also
waived the Annual Stamp Tax for all gas stations.
Furthermore, Government gave
the dealers an increased margin of 20 cents in December 2000, following an
earlier increase of 10 cents on their margin in July 2000. The
overall effect is a 35 cents increase to dealers, thereby raising their
margin on a gallon of gasoline from 65 cents to $1.00.
These decisions have resulted
in Government losing millions of dollars in revenue in 2000. Further
revenue losses will result in 2001. Nevertheless, Government feels
compelled to intervene in the interest of the working people of this Nation.
Mr. Speaker, these are the
actions of a caring and compassionate Government. It is Government’s
hope that these decisions will ease the burden of high fuel prices on all
citizens, and will minimise any inflationary pressures.
Wages and Salaries
Mr. Speaker, Government remains committed to a
vision of a modernised, efficient, customer-oriented, and ultimately
well-paid Public Service. Following protracted negotiations,
Government and the public sector unions agreed to a
14-15% increase in salary for the period 1996-2001. In monetary terms,
this amounted to approximately $15.0 million. Mr. Speaker, on the basis of
these increases, I call on public officers to give of their best and urge
the labour unions to encourage higher levels of productivity among their
As part of Government’s commitment to
improve the terms and conditions for public officers, three committees have
been established to review incentives for three categories of workers.
These are the Nurses, the Police and Teachers.
Mr. Speaker, the demands
placed on Ministers of Government are many and varied. Indeed, both as
parliamentary representatives and heads of ministries, the pressures are
non-stop. In light of these facts and the recent
increases awarded to pubIic officers, Government has decided to give a
salary increase to Government ministers with effect from January 2001.
This will redress an anomaly whereby some senior civil servants are
receiving a higher basic salary than government ministers.
Rationalisation of Concessions
Mr. Speaker, we recognise
that some concessions are necessary to facilitate private investment and
charitable causes. In this regard, I am pleased to announce that
churches will receive 100% duty and tax concessions on selected items.
Mr. Speaker, Government’s decision is in recognition of the vital role of
the churches in the spiritual, moral and social development of our Nation.
Government applauds and
supports the efforts of churches in this important area of nation building
and will do everything possible to support their work, for as it is written
”Man shall not live by bread alone” (Matthew 4.4).
This new regime will only
take effect after a protocol has been discussed and agreed upon between
Government and the church community. The protocol will detail the
items for concessions, validity period, and the conditions for these
Mr. Speaker, this Government
is committed to catering for the whole man!
POVERTY ALLEVIATION MEASURES
Mr. Speaker, as we commence
our journey into the new millennium, our Government’s broad vision of our
beautiful State is a healthy, educated , productive and
prosperous Nation prepared to meet the challenges of a complex and
dynamic global environment.
Mr. Speaker, we have also intimated on several
occasions that the prosperity of our nation must be measured not by how much
we increase the welfare of the few, but by the extent to which we satisfy
the needs of the many including the ordinary Grenadian man, woman, boy, and
In light of this vision and philosophy, and the
findings of the National Poverty Assessment, it may be recalled that the
theme of last year’s Budget Presentation was “Poverty Eradication, through
Growth, Equity and People’s Participation in the New Millennium”.
Mr. Speaker, this New National Party (NNP)
Administration fundamentally believes that social and economic development
of our people converges at the point of employment generation.
Creating the enabling environment for our
people, particularly the poor and dispossessed, to empower themselves, has
been, and will continue to be our fundamental approach to poverty
We also recognize that we do have a moral
responsibility to help those in society who are incapable of helping
themselves, through the provision of the appropriate safety nets.
Mr. Speaker, the track record of this
Administration in the area of economic empowerment, during its brief time in
office, is an enviable one.
Mr. Speaker, this NNP Administration, since 1995
has exposed more young Grenadians to educational opportunities both locally
and abroad, than any other administration in the history of this Country.
This administration has provided more skills
training opportunities for our citizens at all ages, than any other
Mr. Speaker, it was this Administration that
pioneered the introduction of Micro-financing and On-the-job Training, so
that more of our people particularly in the rural communities, could become
Mr. Speaker, it is primarily because of the
instrumentality and support of this Government that over eight hundred (800)
of our young men and women are now gainfully employed in the telemarketing
Mr. Speaker, those who condemn Government’s
support for this locally owned initiative, cannot truly profess to love our
Mr. Speaker, if we have to embark upon a similar
venture that will bring jobs to our people so that they can rise above their
own levels of poverty we will do it without fear of criticism.
Call Centres Grenada Incorporated, is not about
one or two individuals, it is about hundreds of our rural citizens, many of
whom, for the first time in their lives, have been given an opportunity to
earn a decent living and become independent young men and women.
Mr. Speaker, I hereby issue a challenge.
If any local individual or group of individuals can come forward with a
project that will create a similar number of jobs, at such low investment
cost, this NNP Administration will grant similar consideration to that given
to Call Centres Grenada Incorporated.
Mr. Speaker, this Administration has improved
the quality of life of our rural residents, by providing them with a good
network of roads, and access to a potable water supply. Our efforts at
developing our rural infrastructure are unparalleled in the history of our
Mr. Speaker, as a result of the implementation
of prudent fiscal and economic measures, we have ensured that jobs have been
created and unemployment reduced. This in turn has impacted positively
on the alleviation of poverty, particularly, in our rural communities.
Mr. Speaker, I am pleased to announce the
re-opening of the Grenada Craft Centre after several months of closure.
The Craft Centre, under new management, and
close links with the Micro-enterprise Project is now poised to be the
rallying point for the revitalisation of the handicraft industry.
It is important to note that during the closure of the Centre, Government
was not idle. Instead, it coordinated the establishment of several
craft organisations in our rural parishes. These organisations will
work very closely with the Craft Centre and the Small Business Agencies of
Grenada to ensure the industry is viable and benefits all producers.
Mr. Speaker, this development agurs well for the
Social Safety Nets
Mr. Speaker, during my last Budget Presentation,
I outlined a fourteen (14) point action plan for tackling poverty in our
country, particularly, as it relates to the provision of social safety nets.
I am therefore pleased to announce that we have
made significant progress in the implementation of the majority of these
actions. We also remain fully committed to building on the successes
that we have achieved. Some of these achievements include the
Old Age Pension
Mr. Speaker, in 2000, Old Age Pension was
increased from seventy-five ($75) dollars per month to one hundred (100)
dollars per month. The number of recipients have also increased.
In the 2001 Budget, the allocation for Old Age Pension has increased by 16%
as it is projected that an additional five hundred (500) persons will be
included on the Old Age Pension list in 2001.
House Repair Program
Mr. Speaker, approximately six hundred and ten
(610) family units received assistance under the House Repair Program in
2000, at a cost of approximately $1.8M to Government. One third of
this amount was given free to the very needy. In the 2001 Budget, the
allocation for House Repair Programme has increased by 40% to $2.5M.
It is estimated that over seven hundred (700) family units will benefit from
this programme during this current fiscal year.
It is also instructive to note that the
Caribbean Development Bank has already approved a US$7.0M Shelter Project
Primary elements of this project include making
soft loans available to rural residents, for the regularization of land
titles; expansion and improvements to existing homes up to a maximum of
$25,000 per applicant, and the establishment of three low income housing
projects at Mt. Reuil in St. Patrick’s, Palmiste in St. John’s, and Bogles
Preliminary work has already commenced on the
Housing Project at Mt. Reuil with the survey and subdivision of a portion of
the Mt. Reuil Estate. This portion of land will be the site of this
low-income housing demonstration project.
Mr. Speaker, approximately EC$1.5m were spent on
the implementation of Special Projects in 2000. This Program provides
for the financing of small projects such as village roads, footpaths,
retaining walls, and the provision of drinking water, in rural communities,
and economically disadvantaged areas.
It is anticipated that many more rural
communities will directly benefit under this programme in 2001, as budgetary
provisions have increased by almost 70% to $2.5M.
School Book/Uniforms for Needy Children
Mr. Speaker, during 2000, hundreds of our
Nation’s needy children received assistance under this programme, at a total
cost of $500,000. We remain eternally grateful to the Government
and People of the Republic of China on Taiwan for providing the bulk of the
financing of this program. In the 2001 Budget, the allocation of
$500,000 has been maintained.
Mr. Speaker, in my last Budget Presentation I
alluded to the fact that there were hundreds of our Senior Citizens,
primarily the rural poor, who worked for almost all of their productive
lives on Estates, and who contributed to the then Provident Fund and yet
received no just reward for their time and labour.
Mr. Speaker, it is only under this New National
Party Government, and the caring and compassionate leadership of our Prime
Minister, Dr. Keith Mitchell, that this category of workers has been finally
recognized and rewarded. Others had the opportunity, and they did
Accordingly, most estate workers who had
contributed to the Provident Fund and had attained the age of sixty (60) by
December 2000, and are not in receipt of any other pension, will now be
entitled to a National Insurance Scheme (N.I.S.) pension of between $120 and
$150 per month, for the rest of his or her life. Upon death, a
survivor’s benefit will be paid to his or her relatives.
Mr. Speaker, approximately EC$2 million will be
set aside annually, by the NIS, to satisfy this programme. The first
disbursement of pension cheques was made in December of 2000 to 1,144
Mr. Speaker, the compassion and understanding of
this NNP Administration, is not restricted to past agricultural workers
only. We also recognize that there are hundreds of our senior citizens
who worked as janitors, cooks, caretakers and grounds men at our various
schools throughout the State. There are hundreds more who worked on
“Travaux” gangs during the 1950s and 1960s building our roads. These
workers did not contribute to any pension scheme, and as such are not
entitled to receive a regular pension.
It is the intention of this Administration to
make a one-off payment to these workers in recognition of their contribution
to nation building. Both the Ministry of Education and the Ministry of
Works are in the process of compiling the necessary data, so that this
payment can be made later this year. It is estimated that this will
cost Government thousands of dollars.
Mr. Speaker, additional poverty alleviation
measures which were mentioned in the 2000 Budget presentation, and which
will receive additional attention in 2001 include:
The Basic Needs Trust Fund - $1.5 million;
The Micro Enterprise Development Fund $500,000;
The National Employment and Skills Training
New Poverty Alleviation Measures
Mr. Speaker, this NNP Administration remains
fully committed to alleviating poverty, by providing additional benefits to
our people, particularly those who currently subsist below the poverty line
and can no longer actively participate in the labour force.
In addition to the foregoing measures,
therefore, I am pleased to announce three new initiatives, in the 2001
Budget, designed to alleviate poverty.
First, every citizen of our State who is in
receipt of welfare allowances by virtue of age or disability, or any other
person certified by the Department of Social Services, will be entitled to
free transportation on our nation’s buses during normal business
hours. Private charters and hires will not be included.
It is intended that this initiative will
commence later this year once all the necessary structures are put in place.
It will be done on a trial basis initially, and then will be reviewed.
We do expect this to be a permanent programme but its ultimate success will
depend on the level of support and cooperation from the various bus
associations operating in the country. It is anticipated that over
3000 needy persons will benefit from this initiative in its initial stage.
Mr. Speaker, this is the first time, in the
history of our Country that any government has embarked upon such a noble
and ambitious programme, designed to help our poor and needy citizens.
Second, Mr. Speaker, every citizen in our State
who is in receipt of welfare allowance, by virtue of age or disability, or
any other person certified by the Department of Social Services, will be
entitled to receive free medication from any government or private
pharmacy, for a selected range of ailments which require prescribed
Some of these major illnesses that are prevalent
among our citizens include - hypertension, diabetes, glaucoma, cancer, and
Additionally, duties and taxes on these drugs
will be removed, thereby making them more affordable for all Grenadians
who might be afflicted with these ailments. This medical
assistance programme will commence later this year by which time all the
requisite structures will be put in place to facilitate smooth
implementation. Once again, the support and cooperation of all medical
practitioners and pharmacies will be critical to the success of this
Also this initiative will be done on a trial
basis initially, and then will be reviewed. This service will
significantly improve upon what is currently offered by the Government
Mr. Speaker, this is the action of a Government
that cares about the Health and Welfare of our people, a government that
cares about the poor, the disabled, and the disadvantaged, the sick and
suffering, the feeble and the forgotten.
Mr. Speaker, our Government cares!
Mr. Speaker, while others just talk about the
poor, we act on behalf of the poor, and this is the hallmark of
a caring, compassionate and conscientious government.
Third, Mr. Speaker, Government will launch in
the course of this year the Rural Enterprise Project. This Project is
aimed at addressing rural poverty. The Project will comprise three
components: an enterprise development component; a community support
component; and project coordination component.
Under the enterprise development component,
there will be three sub-components. The first is production and
services that would aim to increase production, productivity and incomes for
rural households. The second is processing and marketing that would
improve the efficiency and capacity of the market as it pertains to rural
The third is micro-finance that would respond to
the demand for finance needed for investment in improving production and
processing systems identified during the course of the work and the need for
seed capital for new enterprises.
Mr. Speaker, this Project is estimated to cost
US$5 million and will be jointly financed by the International Fund for
Agricultural Development (IFAD) and the Caribbean Development Bank. It
will be for a six-year period and will have its office located in St.
Mr. Speaker these are just some of the measures
we intend to continue, as well as introduce and implement in this fiscal
year to alleviate poverty and social injustice throughout Grenada, Carriacou
and Petit Martinique. Accordingly, the recurrent allocation for social
services has been increased from $5.2 million in 2000 to $7.8 million in
2001, an increase of 50%.
Mr. Speaker, this is a
Government that means what it says and does what it says!
Mr. Speaker, on behalf of the
Government and People of this Nation, I would like to thank the following
Governments and Institutions for providing financial, economic and technical
assistance during the past year:
The Government of the
Republic of China on Taiwan
The Government of the
Republic of Cuba
The European Union
The Government of Japan
The Government of the United
Kingdom and the Department for International Development
The Government of Canada and
the Canadian International Development Agency
The Government of France
The Government of the United
States of America
The Government of the
Republic of Korea
The Caribbean Development
The Kuwaiti Fund for Arab
The United Nations
The United Nations Children’s
The Food and Agriculture
Organisation (FAO) of the United Nations
The Government of the
Republic of Venezuela
The Federal Republic of
The Organisation of American
The Inter-American Institute
for Co-operation on Agriculture
The World Bank and Related
The Association of Caribbean
The Eastern Caribbean Central
The CARICOM Secretariat
The Caribbean Export
The Organisation of Eastern
Caribbean States (OECS)
The Caribbean Regional
Negotiating Machinery (CRNM)
The Caribbean Financial
Action Task Force (CFATF)
The Caribbean Anti-Money
Laundering Programme (CALP)
Mr. Speaker, I also take this
opportunity to express my deepest appreciation of the Permanent Secretary
and staff of the Ministry of Finance, and to the public workers in other
Ministries and Departments who have contributed to the preparation and
delivery of this Budget.
Mr. Speaker, I also thank the
Clerk of Parliament and staff, for their assistance in the preparations for
Mr. Speaker, I extend my
heartfelt gratitude to all community-based groups and organisations for
their advice and support. I also extend my gratitude to the Chairman
and Members of the Multi-Partite Consultation Committee and other community
groups and organisations with whom we consulted in the past year. Your
contributions have enriched today’s Presentation.
Sincere thanks to the
thousands of Grenadians and friends and supporters of Grenada living abroad.
Thanks also to the many
Grenadians and friends of Grenada who have provided constructive criticisms
of our policies and programmes. Your criticism is a ”mirror” through
which we can see our strengths and weaknesses.
Mr. Speaker, my heartfelt
thanks and appreciation are extended to all my constituents of St. Patrick
West and the entire population of Grenada, Carriacou and Petit Martinique.
Your patience, understanding and support during the past year were indeed a
source of encouragement.
We look forward to your
continued support and understanding as together “we aspire, build and
advance, as one People,” a society of which we can all be proud not only for
ourselves but for our children, and our children’s children.
Mr. Speaker, this Budget Presentation reflects
the impressive achievements of this Government over the past few years and
our plans to build on these achievements. Never before in the history
of this Country has any government in such short a time, done so much, for
so many people, in so many areas of national development.
Yes, Mr. Speaker, our record of performance is a
proud and pleasing one.
From negative and sluggish economic growth
averaging 2% between 1990 and 1995, to robust and sustained growth averaging
7% from 1995 to 2000.
From unemployment of 26.7% in 1994 to
unemployment of 11% in 2000
From per capita income of EC$5,430 in 1995 to
EC$8,750 in 2000.
The investment in infrastructure by this
Government is unmatched by any other Government. Mr. Speaker, our
focus on infrastructure has not been limited to major roads or improvements
in air and seaports and our General Hospital. We have also done
secondary roads, access roads, and farm roads and village footpaths
throughout the length and breadth of this Country.
Our thrust in youth and sports development has
not been limited to the National Stadium. We are now upgrading all our major
sporting facilities throughout the Country.
Our priority has not merely been sustained
robust economic growth, although that has been achieved. Mr. Speaker,
we have provided massive resources to tackle the scourge of poverty in this
country once and for all – old age pensions, house repair, special projects,
housing developments, free transportation for our senior citizens, free
prescription drugs for our senior citizens.
Mr. Speaker, when this Government took office in
January 1999 with a complete parliamentary majority, there were those who
However, Mr. Speaker, this Administration has
demonstrated its willingness to embrace all of our sisters and brothers and
to create opportunities for all.
Indeed, we must all be thankful to the Almighty
God for his manifold blessings on this our beloved Country of Grenada,
Carriacou and Petit Martinique. Under the visionary and courageous
leadership of our Prime Minister, Dr. the Hon. Keith Mitchell supported by a
team of highly motivated and committed individuals, this Government has
worked hard and will continue to work hard for every citizen of this Land.
Mr. Speaker, the challenges facing our small
country are formidable, but this Government is neither daunted nor
discouraged. This is a Government with a vision, a mission
and a plan.
We believe that with the help of Almighty God,
the unity of our people (home and abroad) and the support of friendly
countries, we can make it.
To our young people, I say,
follow your dreams. You can count on this Government to help
you in whatever way we can.
To our senior citizens, I
say, enjoy your twilight years. We will help take care of you.
To our entrepreneurs, I say,
we are prepared to support you. Go build your world and prosper.
You see, Mr. Speaker, this is
a Government of the people and for the People. This is a Government
for the needs of all of our People.
Mr. Speaker, once again, I wish every single
Grenadian, at home and abroad, as well as friends of Grenada, a productive
and prosperous New Year.
May God bless our beautiful Nation of Grenada,
Carriacou and Petit Martinique.
I thank you.
ANNEX A – KNOWLEDGE ENHANCEMENT MEASURES
seize this opportunity to review the progress that has been made towards
this goal during the first year and apprise the Nation of the actions
planned for 2001 and beyond.
Mr. Speaker, the year 2000 witnessed the
establishment of one of the largest telemarketing operations in the OECS,
here in Grenada.
Mr. Speaker, the establishment of the Call
Centre at Seamoon in St. Andrew’s is a shining example of our new thrust in
the Information Technology sector. To date, the Centre has
Already employed 800 young Grenadians, and plans
to create more jobs in the New Year.
The fact that Government retains 40 percent
ownership of the Company reflects the high level of importance placed on
Information Technology in our national development at this particular time.
The recent state visit to Ireland, the fastest growing economy in Europe, by
the Prime Minister validated this strategic thrust by our Government.
We are confident that Information Technology
Parks such as Grenada Call Centres, will have a major impact on reducing the
national unemployment rate over the next few years by creating high quality
employment opportunities for rural residents and generating much needed
Mr. Speaker, during the past year, the National
Employment and Skills Training Programme reached out to approximately one
thousand (1,000) Grenadians of all ages with training in computer literacy
and personal development.
Furthermore, twenty-five (25) Grenadians
enrolled in a workshop on Programming the Interactive Website and every
single participant found employment before completing the workshop.
Educational software programmes in Mathematics,
English, French, Spanish and Biology were made available to Secondary
Schools. A similar programme was started in Geography at the T.A.
Marryshow Community College (TAMCC). In addition, the College
began to offer Information Technology in the list of courses.
Specialised software and accessories were
provided to the School for Special Education, the School for the Deaf and
the St. Andrew’s School for Special Education.
Mr. Speaker, having completed the
Computerisation of our Secondary Schools, Government has now begun to train
our secondary school teachers. As a result, some 400 Secondary School
Teachers began a four-month National Computer Training Programme that is
scheduled to end in February 2001.
Steps were also taken to expand the
Computerisation initiative to our Primary Schools.
In this regard, Computer Systems were installed
in the offices of the Principals of eighteen (18) primary schools, while
Principals of all fifty-eight (58) primary schools received Computer
Two of the Primary Schools have already been
computerised and this programme will continue this year as we seek to
computerise all our learning institutions.
Mr. Speaker, as part of our Government’s aim to
promote a more efficient and customer-oriented Public Service, more than one
hundred (100) new computers were procured and installed in various
government ministries and departments. Moreover, efforts were made to
raise the information technology skills of all public officers. This
training programme will intensify this year.
Work is now well advanced on the establishment
of a Computer Network linking all Government ministries and departments
electronically. Similarly, technology is enabling various departments to
improve services to the public.
In this regard, the Department of Economic
Affairs in the Ministry of Finance has
established a Website.
From a broader perspective, plans are already
advanced for the establishment of a Government of Grenada website that will
offer links to the websites of the various ministries and statutory bodies.
This will facilitate more timely and effective information transfer to
prospective tourists and investors.
Mr. Speaker, a major undertaking in 2001 will be
the launching of a broad-based Information Communication Technology Council
and the preparation of an Information and Communication Technology Plan.
This Plan will involve all of our citizens in the Technological Revolution.
ANNEX B –
IMPROVING THE REGULATORY FRAMEWORK
Mr. Speaker, the insurance industry continues to
be a significant player in the financial sector. There is a clear
need, however, to strengthen the supervision of the insurance industry.
As a consequence, Government intends to enact a new Insurance Bill during
the first half of this year. In this regard, there have already been
extensive consultations with the local insurance industry.
Furthermore, Mr. Speaker, provision has been
made in the 2001 Estimates for an additional officer to serve in the Office
of the Supervisor of Insurance. This Office will benefit from several
training programmes during the year.
Mr. Speaker, I wish to make it clear that there
will be no place in the industry for companies that are unable to meet their
Mr. Speaker, since 1996, the Grenada Ports Authority has been
responsible for the implementation of the Grenada Shipping Act of 1994.
This means that the Authority is responsible for the regulation of shipping, the
safety of Grenadian seamen and the safety of Grenadian ships.
As Minister responsible for Shipping, I urge all vessel
owners to comply with the requirements of the Maritime Administration and to
have their ships registered under the Grenada flag.
Mr. Speaker, this Government cares about the safety of how seamen and
fisherfolk, however, without their cooperation and compliance, it will be
difficult, if not impossible, for either the Maritime Administration or
Government to be able to render assistance to them, if they are detained in
am pleased to advise our seamen that very soon, the Grenada Ports Authority will
be providing training for them in accordance with the latest international
standards for training seafarers. I urge them to take advantage of this
GRENADA: MEDIUM TERM PROJECTIONS
Real Growth Rate
Consumer Price Index
Debt Service Ratio
BOP Current Account/GDP
GRENADA: FISCAL SUMMARY
Current Account Surplus
Customs & Excise