Start of New Law Year

A section of Grenada’s lawyers

A section of Grenada’s lawyers

Members of the Legal profession in Grenada have been told that their failure to assist citizens in need of justice could result in increased suicide.

Delivering the Homily during a service at the St George’s Methodist Church on Tuesday morning, to mark the opening of the New Law Year, 2013 to 2014, Rev. R. Emasseau Pierre, Superintendent Minister warned the officers of the Court that in Grenada there are citizens crying out for justice with no success.

He said that there are cases where people would have worked hard to earn their money only to find that the monies are taken away from them with no justice, no one facing the penalty, and no jail time for the offenders.

“No one seems to be accountable”, Rev. Emasseau said as he appealed to legal practitioners to “act now” before it’s too late.

The Methodist Minister encouraged the attorneys-at-law to always invite Jesus Christ to be with them as they seek to ensure that justice is served throughout the country.

While noting that earning money is one of the reasons behind choosing a successful career, Rev. Emasseau, warned the lawyers that they have to do things, make decisions that please Jesus Christ – the lawyer for all people.

He reminded them to give justice where justice is due, give justice to whom justice is due and ensure that they treat everyone equally.

“Try not to do things (just) for the money you getting but to please God”, was his charge to the lawyers.

Rev. Emasseau also encouraged the officers of the Court to have compassion as they carry out their duties.

Senior Crown Counsel in the Office of the Director of Public Prosecutions, Howard Pinnock, also echoed the message of compassion during a Special Sitting of the Court as he appealed to his colleagues to extend their legal services to accused offenders.

Pinnock said that 95 cases are down for the October Assizes, 52 of them being traversed from the previous Assizes, and that there was 43 new cases.

He noted that as the opening of the Assizes looms closer, many accused persons on the list do not have legal representation for their cases.

The Senior Crown Counsel encouraged practitioners to come forward and assist these unrepresented people.

The October Assizes sees a change in the Assizes lists with a noted decrease in the number of sexual offences, and an increase in Dangerous and Grievous Harm offences topping the list.

Two new murder cases are included on the list -45-year old Isach Gilbert accused for the alleged murder of female companion, Marsha Cherman of Pearls, St. Andrew’s last year and 47 year old Japheth Jeremiah of Soubise, St. Andrew charged with the alleged murder of 40 year old Rebecca Fletcher last year.

The High Court Special Sitting was presided by the OECS Chief Justice, Her Ladyship, Dame Janice M. Pereira, who delivered the Opening Address from the High Court of Justice in the Territory of the Virgin Islands where the Court of Appeal will be holding its first scheduled Sitting for the New Law Year.


IMF Makes Declaration ….. Grenada is Bankrupt and Uncreditworthy Again

Grenada is once again considered as a bankrupt and uncreditwothy country by the Washington-based International Monetary Fund (IMF).

These were the sentiments expressed by the head of an IMF Mission, Aliona Cebotari that concluded a visit to the island last week to access the economic and financial performance of Grenada under the seven month old New National Party (NNP) government of Prime Minister, Dr. Keith Mitchell.

THE NEW TODAY was able to get a copy of the minutes of a meting held last week Friday between the IMF team members and several persons from the Civil Society grouping in the country.

The document quoted the IMF official as saying that the Mitchell government cannot pay its bills and the IMF was in fact lending money to the administration to make these payments.

“The Government of Grenada cannot pay its bills. Therefore it is not creditworthy and cannot borrow any money. Therefore the IMF was lending money to help Grenada pay its bills. World Bank and the Caribbean Development Bank were supporting the Government of Grenada with its other programmes”, the minutes quoted Cebotari as saying.

The last time Grenada was declared uncreditworthy by the fund was 1989 at the end of term in office of the first NNP governmnent of late Prime Minister Herbert Blaize who went on to form The National Party (TNP) after he lost a leadership battle with his then Works Minister, Dr. Mitchell.

Faced with the prospects of harsh measures from the IMF, the incoming National Democratic Congress (NDC) administration of Sir Nicholas Brathwaite was forced to implement a home-grown Structural Adjustment Programme (SAP) to take the country out of its uncreditworthiness.

The architect of the programme was then Finance Minister, the late George Ignatius Brizan who received assistance from several Caribbean leaders including former Vincentian leader, Sir James Mitchell, John Compton of St. Lucia and former President of the Caribbean Development Bank (CDB), Crompton Bourne.

Within three years, Grenada was once more able to borrow funds from international organisations to engage in capital development projects but the electorate voted out Congress from office in June 1995 in favour of Mitchell’s NNP.

Over the next 13 years, Dr. Mitchell engaged in a massive borrowing and spending spree that was the island’s debt shot from 373 million E.C dollars in 1995 to just over EC$1.8 billion when it was voted out of offive in July 2008.

The IMF official also addressed the members of the Grenada civil society group on charges being made by Prime Minister Mitchell that his cash-strapped government is not prepared to accept a programme from the fund that does not have growth and job-creation as its centre-piece.

She said that whatever programme the Government wanted to propose had to be in line with what the Board of the IMF would support.

“It was the responsibility of the IMF Technical Team to so advise the government. IMF’s role was limited to addressing macro-economic issues”, the report added.

During the meeting with the Civil society organisation, the controversial Citizenship by Investment programme involving the sale of passports to get quick cash by government was also raised.

Cebotari said the IMF does not have an official position on Citizenship by Investment and from an economic perspective, it all depended on how the programme was managed.

“It needed to be transparently managed”, the document quoted the IMF official as saying.

THE NEW TODAY has decided in the public interest to reproduce some of the main highlights in the minutes of the meeting between the IMF delegation and the CSO grouping.

Representatives of Civil Society Organisations met with Members of the IMF Mission to Grenada as well as representatives of other institutions on Friday, September 13th, 2013:

* Aliona Cebotari, Head of IMF Team to Grenada

* Wayne Mitchell, IMF Resident Representative to the OECS

* Ronald James, Grenada Country Economist, Eastern Caribbean Central Bank

* Clarence Hinkson, Country Economists, Caribbean Development Bank

Opening Remarks by Ms. Judy Williams:

The meeting got underway at around 2.45 p.m. and was chaired by Ms. Judy Williams, Chairperson of the Non State Actors Panel and the Grouping of Civil Society Organisations.

Ms. Williams thanked the members of the team for affording CSOs a meeting and hoped that in the future, CSOs would be included in the official itinerary of future IMF Missions in Grenada.

She apologised for the absence of a number of persons who were unable to attend because of the last minute rescheduling of the meeting from Thursday September 12th to Friday September 13th.

In her remarks, Ms. Williams noted the following:

*While the Grouping of CSO recognised that it was not the elected government, it recognized that it had a voice. It could represent issues and concerns that the members of the Mission needed to hear/ought to hear in order to have an appreciation of the reality of real people who do not have a voice.

*Arrangements with institutions were made by the sitting government. However, there were issues and concerns that were not represented by the elected government. The policies of these institutions will cause hurt and hardships to those who do not have a voice. Government is making arrangements to deal with those hardships.

*The CSO Grouping identified broadly with the general framework put forward by the Government in a presentation to the Committee of Social Partners. However, there were many questions and gaps for Social Partners since they did not have the required information.

*Among the unanswered questions for the Social Partners were the issue of Lessons Learnt – what were these lessons? What will be the mechanisms that will be put in place to ensure that the learnings from the previous experiences are applied to the benefit of the country?

Social Partners also had questions about measures proposed for Revenue Enhancement and Revenue Expenditure.

Other CSO representatives offered the following queries and observations:

*Where was the country heading under an IMF programme and what could civil society contribute?

*What model could be applied to the Grenada situation?

*What relief could an IMF programme bring to a sector such as fishing that had been experiencing phenomenal growth?

*How would the IMF programme contribute to building the resilience of Grenada’s communities and economy so that in the future, the country would be able to withstand external shocks?

Remarks from Ms. Aliona Cebotari, Head of IMF Mission:

* Debt “Cancer”:

Ms. Cebotari likened Grenada to a “patient which has cancer”. In order for the patient to heal and thrive, the cancer has to (be) removed.

* Insidious Fiscal Situation:

She described the fiscal situation as “insidious”. The Government cannot pay its bills to local businesses and these in turn could not pay their bills. Since the government was a significant player in the economy, this situation was affecting the entire economy.

* Fiscal Adjustment:

The treatment required was “fiscal adjustment” – enhancing revenue and decreasing expenditure.

Among considerations would be:

*What could be done to protect the most vulnerable in society?

*What conditions were required to support the strong aspects of the economy?

*Debt Restructuring and Debt Forgiveness:

If Government was seeking debt restructuring and debt forgiveness, it had to show how it would sacrifice.

*High Monthly Deficits:

Government was running high monthly deficits re wages, transfers and infrastructure costs. The debt situation has to be fixed.

* Fixing the Debt Situation:

Huge adjustments were required in order to stabilise the debt situation. There has to be comprehensive adjustment. Grenada’s income has been shrinking yearly. It now has to make adjustments when resources are less.

* Adjustments:

Wealthy people are not paying taxes but can afford to pay taxes. E.g. people who have yachts.

* Social Safety Nets: Social safety nets have to be increased. Government can increase cash transfers for the most vulnerable. There will have to be objective criteria by which targeting is done.

* Potential for Growth: Focus on sectors that are healthy and can grow.

* Costs of Energy: This has to be addressed since Grenada’s energy costs are too high. Serious attention should be given to the matter of renewable energy.


The following queries and observations were noted:

* Focus should be on the sectors that could generate income and growth as opposed to sectors where there is a “perception of generating income”.

Poultry was one of those sectors which had the potential to generate income. However, there were policies that were strangling the sectors such as the incentives given to the “local” feed mill.

In order to realise its potential, the poultry sector would require incentives and therefore (there) was concern about any blanket measures which could negatively affect incentives to the local poultry sector.

* In the Caribbean, when people heard about IMF, they thought about the Jamaican experience. In spite of having been on several IMF programmes, the country was mired in debt. Were there any examples where the level of adjustment had put the country on the right path?

The IMF Representative resident in the Eastern Caribbean gave the examples of Barbados and Trinidad. In Barbados, a Social Pact was forged between government, private sector and trade unions.

In order to avoid devaluation, there was agreement about an 8 percent cut in wages to avoid job losses and a pact between private sector and trade unions about holding wages steady.

* While the Barbados and Trinidad programmes may have been considered economic successes, had the social impact been assessed?

* Grenada’s Voluntary Structural Adjustment Programme (in the early 1990’s involving late finance Minister George Brizan) which had the blessings of the IMF could be considered a success.

In the context of Grenada, had this programme been reviewed for lessons learned?

* Generally a consequence of IMF programmes was political fallout.

* Current IMF programmes had a stronger focus on improving social programmes for the poor and vulnerable.

* To what extent could the IMF impress on the Government of Grenada the need for consensus in respect of its proposals to and agreement with the IMF?

* What was the view of the IMF on the proposed Citizenship by Investment programme proposed by the GoG as a revenue enhancement measure? There were many social risks associated with the Citizenship by Investment programme and increased the vulnerability of the country’s citizens.

Response by IMF Head of Mission, Aliona Cebotari:

* Lessons Learned: Grenada has been on an IMF programme during seven of the last ten years. Therefore lessons from the previous programmes would be taken into consideration when deciding on the programme to address the current situation.

There would be expert assessment of the last two programmes.

* Role of the IMF: The Government of Grenada cannot pay its bills. Therefore it is not creditworthy and cannot borrow any money. Therefore the IMF was lending money to help Grenada pay its bills. World Bank and the Caribbean Development Bank were supporting the Government of Grenada with its other programmes.

* Societal Ownership: It was recommended that the programme be presented to the broader society in order to build ownership of the programme.

* What the GoG Wants to Do vs. What the IMF Will Support: Whatever the programme the Government wanted to propose had to be in line with what the Board of the IMF would support. It was the responsibility of the IMF Technical Team to so advise the government. IMF’s role was limited to addressing macro-economic issues.

* Citizenship by Investment: The IMF does not have an official position on Citizenship by Investment. From an economic perspective, it all depended on how the programme was managed. It needed to be transparently managed.







Flawed exchange rate attitudes

Brian FrancisIt has been argued time and time in the economics literature that the exchange rate is one of the most critical prices in international trade. That is so because the exchange rate determines the extent of international competitiveness of a country’s exports of goods and services. To put it simply, the lower the exchange rate the higher the value of a country’s currency and hence the less attractive its goods and services would be to the rest of the world. The reverse scenario also holds true.

If we accept that argument, then, it is not too difficult to understand and appreciate why China and Japan would have for many decades maintained pretty high exchange rates with the United States dollar. In short, what both of these countries have been doing is subsidising their exports to make them more affordable and attractive to the rest of the world, particularly the United States, thereby easily expanding their levels of exports of goods and services.

The United States in response has been calling without much success for an appreciation of those two currencies so that the current imbalances that exist in the trade sector can begin to move in its favour.

Since higher exchange rates are associated with cheaper exports, and the growth in a country’s exports is supposed to provide stimulus to economic activity, why, then, do some countries settle for low exchange rates? Further, when economic conditions begin to deteriorate as a result of changing dynamics on the global front, why are some countries so resistant to increasing their exchange rates to put them in a relatively stronger position to boost their quantities of exports of goods and services? The answer to those questions is quite straightforward: flawed exchange rate attitudes!

You see, take for example, the case of Caribbean countries. How will the citizens of the OECS respond if the Eastern Caribbean Currency was to be devalued? How many Barbadians would be prepared to accept a devaluation of the Barbadian dollar? I am of the opinion that only a minority of persons will ever accept any explanation from our respective governments that seek to justify a devaluation of our most cherished, existing exchange rates! Why?

Devaluation, which simply represents an increase in the exchange rate of a country’s currency under a fixed exchange rate regime, has clearly become a rather contentious word in our parts of the world; justified in some instances, ridiculous in other cases.

Why should that situation exist when in fact a devaluation makes a country’s currency less valuable and hence its exports more appealing to the rest of the world? Shouldn’t every country in the region be excited about the prospects of increasing its exports, especially in an international environment that has become rather hostile in recent times? I would certainly think so!

As ailing economies, going forward, we have to begin to look seriously at all available economic management strategies and options available to us in response to the continued turmoil in the global economy. We cannot continue to rely solely or heavily on sentimental values to take us to the glory land. If, for example, there are net positive benefits to be derived from devaluation, our leaders should not hesitate to implement such a policy. For that to happen, though, we have to eradicate our present flawed exchange rate attitudes! Can we?


Dr. Brian Francis, the former Permanent Secretary in the local Ministry of Finance, is a Senior Lecturer in the Department of Economics at the Cave Hill Campus in Bridgetown, Barbados of the University of the West Indies)

Shipment of medical supplies from Switzerland

Following what seemed like a frustrating wait at times, the first container of medical supplies and furniture totaling over USD$100,000 from Switzerland has finally arrived in Grenada.

Over a period of time, items ranging from medication to furniture for the hospital and other items intended for Grenada’s health care system were solicited by Grenadian entrepreneur, Chester Simon, a Zurich-based restaurateur.

It was not the first time that Simon had come to Grenada’s rescue.

Following Hurricane Ivan, the former musician also assembled containers of aid for the battered tri-island State, and has a penchant for helping worthy causes in his homeland.

Simon was then faced with the task of finding the funds necessary to ship the first container to Grenada, a process that took several months.

Eventually, a group of Grenadians residing abroad began assembling on the GrenadaBroadcast Skype network and embraced the idea of raising the necessary funding.

These people included Trisha Mitchell (Toronto), Chester Simon (Zurich), Tesfa Peterson (Montreal), Kenneth Nedd (Miami), and Michael McLeod (New York).

Mitchell initiated a web-based fundraiser through the website, and that was followed by a community fundraiser organised by the Grenadian community in Montreal with the help of Peterson.

Through email campaigns, Nedd and McLeod were also able to generate support from family and friends; as was Margaret Francis from New York, along with donors from right here in Grenada.

When the effort appeared to be falling short of its target, the initiative received a shot in the arm from Swiss national, Peter Gernert, a retired businessman who now lives in Grenada.

Gernert provided matching funds, which brought the initiative close to its goal.

The remaining amount was then provided by the Government of Grenada, under the auspices of former Health Minister, Ann David-Antoine who is now an advisor to the current Minister of Health.

David-Antoine has advised the team that the container has now been cleared from the St. George’s Port and emptied and that distribution has already begun.

Simon has already shipped another container, which is due to arrive in Grenada shortly.



It is often said that the calypsonian is the peoples’ spokesman because he reflects in song the vibes and sentiments of the people. How true?

In 1998, the Barbadian calypsonian, Red Plastic Bag (RPB), sang a song entitled, “Material.” In that song, the lyrical master said: “Trouble, every year calypsonians in trouble, it’s so hard to find material…but this year have no fear ’cause Plastic Bag is here.”

With those lyrics in mind, THE NEW TODAY is once again forced to reflect on the current state of the economy in Grenada especially in light of some startling revelations from Aliona Cebotari, head of the IMF team that just concluded a visit to the island.

Oh, how this newspaper wish that someone or something could come forward to provide the much needed “materia” to allow us to resolve what clearly now seems to be insurmountable economic woes facing Prime Minister, Dr. Keith Mitchell and his New National Party (NNP) administration.

Sadly, from the look at things, it does not seem as if we in Grenada will ever be so lucky as to have someone in economic circles to provide us with “material” to help us avoid the clutches of the IMF and the Chemotherapy treatment that is so badly needed for the sick patient known as Grenada, Carriacou & Petite Martinique.

Do we have capable Grenadian economists in and out of the region who can make a real difference in the present situation? Why aren’t the skills of these people tapped and given the chance to do so?

Only seven months ago, Dr. Mitchell and his NNP were ranting and raving all around the country claiming that the NDC had failed miserable in its management of the economy and that the NNP is now presenting itself to the people of Grenada as the “saviour” since under Congress and “Uncle Tilly the island had become “a failed State”.

After all, the recent general election of February 2013 was supposed to be “deliverance” time for the country and economy.

And you know what: Dr. Mitchell and his NNP have delivered! They have delivered continued economic nightmares so much so that the International Monetary Fund (IMF) is now declaring the economy of Grenada “bankrupt” and that the country is once again uncreditworthy.

Let no one fool you, the current state of economic affairs in Grenada cannot be blamed entirely on the NDC as Dr. Mitchell would like so many of us to believe.

In 1995, the then NDC government of Sir Nicholas Brathwaite and the late George Brizan left a rather healthy economy for Dr. Mitchell and the NNP – an economy which was stable and in which the country’s international creditworthiness was restored following the successful implementation of a structural adjustment programme.

The need for that programme was to correct the mismanagement of the economy by the previous NNP administration of the late Herbert Blaize and in which Dr. Mitchell served as Minister of Communication & Works.

On assuming office in June 1995, Dr. Mitchell and his newlook NNP went on a “borrowing and spending” spree. The net result after thirteen years in office was an economy left in shambles with high and unsustainable fiscal deficits, public debt, inflation, and unemployment.

In addition, the country was struggling with low economic growth rates, low productivity, low consumer and investor confidence and low morale among public officers.

Those were the massive, thick trees in the economic forest of Grenada that the NDC encountered and struggled immensely to overcome throughout its four and a half years in office until it was booted out in February.

If the truth be told, the NDC only managed to scratch the surface when it came to finding meaningful solutions to the economic woes it inherited from Dr. Mitchell and the NNP.

Clearly, therefore, Dr. Mitchell and his party’s victory at the last poll did one and only one thing: Return the same Dr. Mitchell to the “economic and financial crime scene” so that he could attempt to clean up the economic mess he created for this country over a thirteen year period due to his reckless borrowing and spending attitude.

In the prevailing economic climate in the country, one cannot fail to observe that despite the changes in governments, Timothy Antoine, the Permanent Secretary in the Ministry of Finance remains intact. Someone in authority needs to explain to the Grenadian people what precisely is the role of the Permanent Secretary in the Ministry of Finance?

If the holder of that most critical post in the public service is doing his job effectively, then, how did the country and economy end up bankrupt under his watch? Is it the case that his advice and guidance to the Ministers of Finance are being constantly ignored?

Or is it that he does not have the technical skills and knowledge to impart to the Minister of Finance to provide some basis for helping to resolve the most pressing economic problems plaguing the country?

To what extent does PS Antoine seek and incorporate the views and opinions of other senior technical members of staff within the Ministry of Finance? Is it the case that for more than a decade, the Permanent Secretary in the Ministry of Finance was more interested in preserving his job than solving the country’s economic problems and therefore channeled his talents and creativity toward pandering to his respective Ministers of Finance?

It is abundantly clear to THE NEW TODAY that something is not quite right when it comes to the manner in which the Ministry of Finance is being managed and led. There is clear failure in that Ministry from both the senior administrative level and at the political level.

Given the fact that Dr. Mitchell has publicly declared his immense confidence in Mr. Antoine and even now places a tremendous amount of responsibility in that gentleman’s hands as far as managing the economy is concerned (at the expense of even his Chief Policy Adviser, Dr. Patrick Antoine), then, it is only fair to conclude that PS Antoine has a lot to clarify to the Grenadian people for the fact that the economy is now being declared bankrupt by the IMF.

After all, Mr. Antoine has sat in the chair of Permanent Secretary in the Ministry of Finance during the previous Mitchell administration, for the entire duration of the NDC government, and he is still ever so present in that prestigious office!

When you consider the number of persons in the public service who have been given marching orders by this same Dr. Mitchell and his NNP administration for all sorts of trivial reasons, one cannot fail to ask: Why is Timothy Antoine untouchable? When does performance or lack thereof in office matter?

It takes more than trust in an individual to take Grenada out of its present economic quagmire and to realise the birth of the so-called new economy that was promised the people back in February and which they fell for in massive numbers thus the 15-0 clean sweep at the polls.

Grenada should not be treated like the private real estate property of anyone. What is needed right now are the best sons and daughters with the skills and competence to come to its rescue.

Oh Grenada – land of our birth – why are you going back into 1989 and this state of bankruptcy and uncreditworthiness?


Sir Paul laid to rest

Sir Paul Scoon, GCMG, GCVO, OBE, a Grenadian hero laid to rest

Sir Paul Scoon, GCMG, GCVO, OBE, a Grenadian hero laid to rest

Former Governor General, Sir Paul Scoon, GCMG, GCVO, OBE, was laid to rest yesterday (Thursday) in his hometown in Gouyave, St John.

The country’s longest serving GG lay in State on Wednesday at the island’s temporary house of Parliament – The Grenada Trade Centre and was laid to rest after a ceremony at the St Peters Roman Catholic (RC) Church in Gouyave, St John.

A wide cross section of dignitaries attended the funeral service for the former Head of state who become a household name worldwide following the U.S-led military action in Grenada on October 25, 1983.

Sir Paul co-operated with the Caribbean and American soldiers who landed on the island to uproot the Revolutionary Military Council (RMC) of general Hudson Austin that had seized power in a bloody coup in which the former Marxist leader, Maurice Bishop was killed.

As Governor-General, Sir Paul appointed educator Sir Nicholas Brathwaite to head an Interim Government until elections were held on December 4, 1984 t bring Grenada back into the fold of constitutional rule after nearly five years of non-elected left-wing administration.

Sir Paul’s entombment took place at the Dougladston Cemetery after the State funeral for the man who served as GG from 1978 to 1992.

The journey of Sir Paul is captured in his book entitled, “Survival for Service” that provides a personal account of his experiences as Governor General.

PM Mitchell: No to legalising marijuana

Prime Minister Dr. Keith Mitchell says that he would not support his Vincentian colleague, Dr Ralph Gonsalves as he seeks CARICOM’s support to legalise marijuana.

Press Secretary in the Prime Minister’s Office, Kisha Alexander-Grant in response to The New Today’s queries about Grenada’s position in relation to this new development, said that Prime Minister Mitchell indicated that while he respects the St Vincent and the Grenadines Prime Minister’s intent for his country, he has no intention to support this cause in the interest of the Grenadian people.

In a letter addressed to chair of the Caribbean Community (CARICOM) grouping last week, Gonsalves made a plea for “a reasoned debate” led by CARICOM political and civic leadership in the context of the legislation of marijuana for medical and other uses.

In his letter to Prime Minister of Trinidad and Tobago, Kamla Persad-Bissessar, Gonsalves said it is high time that CARICOM addresses “this matter in a sensible focus not hysterical manner”.

According to a CMC report, Prime Minister Gonsalves said that the marijuana plant has a bundle of proven and potentially beneficial uses and it is true that its use and abuse and the consequential criminalisation of its cultivation, possession and supply have impacted on the health, welfare and security of the people.

Dr. Gonsalves felt that the matter should have been explored at the meeting of the Bureau of CARICOM leaders in Trinidad on September last week Friday, the CMC report said.

In addition, the Vincentian leader pointed out in the letter that preparatory work can possibly be done so as to place the matter on the agenda of the CARICOM Inter-Sessional summit to be held here in February next year.

Prime Minister Gonsalves said the general public is disappointed with “the failure and or refusal of the political and civic leadership in CARICOM to jettison it or unnecessary caution and lethargy in addressing some of the controversial contemporary issues of real import,” the CMC report said.

St Vincent and the Grenadines is considered to be one of the major suppliers of marijuana in the Caribbean.

The previous administration of former Prime Minister Tillman Thomas refused to bow to pressure to legalise the illegal substance under his tenure.

In 2012, Thomas made his position clear in his address to the 9th Annual General Meeting of the Grenada Drug Information Network and National Observatory on Drugs (GRENDIN/NOD).

He said the Congress government rejected calls to decriminalise marijuana ten years ago and will stick to its position, given the potential impact on “national well-being and law and order.”

“Today, amid renewed attempts at the regional and international levels, I wish to place on record that my government will not yield to such pressures or persuasions. We will not decriminalise or legalise marijuana,” the former prime minister said, while reaffirming government’s commitment to the national anti-drug campaign.


Grenada is at a disadvantage in oil deal with the Russians

A Texas-based oil consultancy and advisory group had impressed upon the former Tillman Thomas-led National Democratic Congress (NDC) government that it should seek to terminate an oil and gas agreement that was signed by the former Keith Mitchell regime with a Russian outfit.

The former Energy Minister and now Minister of Communications & Works, Gregory Bowen had signed the deal in March 2008 with Global Petroleum Group Ltd (GPG) headed by Eduard Vasiliev.

A report done on the agreement by Dynamic Global Advisory Company of Houston, Texas was obtained by THE NEW TODAY newspaper.

The report pointed to “an uncommon approach” that was followed by the Mitchell then-ruling New National Party of 2003 to 2008 in arriving at the agreement with the group of Russians to look for oil in Grenadian waters.

It said among other things that the government was prepared to take too many legal risks in order to satisfy the demands of GPG to start the exploration process on the island.

According to Dynamic Global, the Mitchell regime might have been making decisions “under duress” as a result of the persistent demands being made by the Russians.

In this regard, it made mention of the $2.5 million that was advanced by GPG to the Grenada government to cover the cost of its Arbitration Tribunal hearings in London, England against American oil investor, Jack Grynberg of the State of Colorado.

As a public service, THE NEW TODAY would give details of the report as prepared by the Texas group on the Russian/Mitchell/Bowen oil agreement.


On March 31, 2008, the GOG and GPG entered into a PSA for the Exploration, Development and Production of Offshore Petroleum Resources of Grenada.

On that same day the GOG also issued an Exploration License to GPG. The PSA was signed by Mr. Gregory Bowen, Grenada’s Minister responsible for Petroleum Affairs, and Mr. Eduard Vasiliev, Chairman of the Board, President and Chief Executive Officer of GPG. The Exploration License was issued under the signature of Mr. Bowen.

On January 5, 2012, the GOG retained the services of DGA to review the GOG-GPG PSA and Exploration License and determine whether they fall within the generally accepted norms of the international petroleum industry.

DGA was also requested to assist the GOG in developing a strategy to terminate the PSA if it was found not to conform to industry standards.

This report contains information pertaining to the analytical review and evaluation of eleven (11) documents that the GOG provided DGA at the start of the project.

Evaluation of the Production Sharing Agreement and the Exploration License from a Legal Perspective

Analytic review of the documents

In connection with its request that DGA prepared this evaluation report, the GOG provided DGA with copies of 11 documents, including the PSA and the Exploration License.

DGA received copies of six preliminary agreements (the “Preliminary Agreements”) that appear to have created the framework for the contractual relationship between the GOG and GPG. Also included among the documents were copies of the Petroleum and Natural Gas Deposits Act of 1991 (the “Petroleum Act”), the Petroleum and Natural Gas Deposits Regulations of 2007 (the “Petroleum Regulations”), and the Minutes of the first meeting of the Advisory Committee on April 17, 2008 (the “Advisory Committee Minutes”).

DGA asked the GOG if there were any other relevant documents available, but no other documents have been submitted to DGA by the GOG.

The Preliminary Agreements referred to above reveal an uncommon approach that was followed by the GOG and GPG leading up to the execution of the PSA.

A short summary of each of the Preliminary Agreements is set forth below.

Under a so-called Funding Agreement, dated September 28, 2005, GPG agreed to indemnify the GOG for all costs incurred in connection with the GOG’s defense of the ICSID arbitration claim brought by RSM Production Corporation (“RSM”) arising out of a 1996 agreement between the GOG and RSM.

GPG agreed to deposit US $2.5 million in the account of the GOG in St. George, Grenada to fund the defense of the RSM arbitration claim. In return, regardless of the outcome of the arbitration proceedings, the GOG agreed to enter into a contract with GPG that was supposed to be attached to the Funding Agreement. The copy of the Funding Agreement that was submitted to DGA, however, did not include any Annexes, and, therefore, we can only assume that Annex 3 was a draft of the PSA.

On September 28, 2005, GPG also entered into a Contract of Agency with Mr. Lev Model, whose address was listed as St. Andrew, Seamoon Industrial Park, Grenada. This principal/agent arrangement provided that Mr. Model, the agent, would fulfill GPG’s obligation to the GOG to deposit the amount of US $2.5 million into the same bank account of the GOG that was referenced in the Funding Agreement.

GPG, the principal, was obligated to reimburse Mr. Model in full by making four incremental payments of between US $600,000 and US $650,000 within three weeks thereafter to Mr. Model’s own account in Grenada. This Contract of Agency raises questions with respect to GPG’s financial ability and the nature of the relationship with its partners and/or representatives.

The Memorandum of Understanding between the GOG and GPG, dated October 18, 2006 (the “MOU”), provided that, despite the ongoing ICSID arbitration claim by RSM, the GOG would permit GPG to begin the analysis and interpretation of confidential offshore technical data through a working group comprised of representatives of both parties.

Under the MOU, the expenses incurred by GPG in such analysis and interpretation activities were deemed to be cost-recoverable exploration expense – a significant departure from industry norms since no PSA was in existence on the date of the MOU.

The MOU also contains a reminder of the parties’ obligation to sign the agreement set out in Annex 3 of the Funding Agreement within 15 days after an award was made in the RSM arbitration proceeding. These elements of the MOU suggest that the GOG may have been willing to expose itself to a potential breach of contract claim by RSM with respect to the confidential information the GOG was prematurely sharing with GPG.

On December 22, 2006, the GOG and GPG entered into an Indemnity Agreement, which was related to a permit the GOG had granted to GPG on the same date (DGA was not provided with a copy of such permit).

According to the Indemnity Agreement, the permit gave GPG “permission to carry out investigation in, on or in relation to land, which in the Minister’s opinion are relevant for the identification of Petroleum exploitation or development.”

The Indemnity Agreement included the admission that the “permit could have a negative impact” on the GOG in the RSM arbitration proceedings. GPG agreed to indemnify the GOG against all losses it may incur as a result of granting the permit.

Again, the GOG showed its willingness to take legal risks in order to satisfy GPG’s apparent demands to undertake activities for which it did not possess express rights.

An Undertaking was entered into by the GOG and GPG on July 12, 2007, which recited GPG’s desire to obtain an Exploration License before the conclusion of the RSM arbitration proceedings, as well as the GOG’s reluctance to issue such an Exploration License. Nevertheless, the GOG did agree to issue the Exploration License as soon as the arbitration proceedings ended.

A Memorandum of Commitment (“MOC”) between the GOG and GPG was executed on September 11, 2007. The MOC includes an unusual statement to the effect that GPG was “in urgent need of a definitive commitment” from the GOG “to grant an exploration and development license so as to enable GPG to engage the services of Seismic Shipping Services to carry out the exploration process.”

The GOG agreed to a time table under which it would promulgate regulations to enable GPG to make application for an Exploration License and to grant an Exploration License and execute a PSA in the form of Exhibit A to the MOC (DGA was not provided with a copy of Exhibit A).

The GOG succeeded in negotiating a delay clause in the MOC that would allow the GOG to avoid prejudice against Grenada’s position before the RSM-ICSID arbitration tribunal.

The contents of the MOC lead us to believe that the GOG may have been making decisions under duress as a result of the persistent demands being made by GPG.


General Comments

The PSA and Exploration License. Although we do not have a copy of the draft, it is likely that the PSA existed in draft form when the Funding Agreement was signed on September 28, 2005.

While the basic form and outline of the Exploration License appears to follow the requirements for Exploration Licenses as set forth in the Petroleum Act and the Petroleum Regulations, its inclusion of certain extraneous matters seems unnecessary, and the description of the elements of the work program seems to be too general.

There are also a few gaps and omissions in the Petroleum Act and the Petroleum Regulations, some of which will be discussed in the Detailed Comments section below in connection with the PSA and the Exploration License.

Detailed Comments

The comments set forth in this section are intended to highlight the more significant and relevant problems that have been identified as a result of our review of the PSA and the Exploration License.



In Article 1.1(f) of the PSA, the definition of the term “Best Oilfield Practices” utilizes a reference to the same term in the Petroleum Regulations, but the actual term defined in the Petroleum Regulations is “good oilfield practices.”

Therein, the term “good oilfield practices” is defined as follows: “means all those things that are generally accepted internationally as good, safe and efficient in the carrying on of exploration of petroleum or development operations in the field.”

In order to provide more guidance, this definition should be expanded by adding the following words: “and includes standards and practices that are consistent with those generally accepted for comparable petroleum operations elsewhere in the world where there are similar operating and environmental conditions,” and the expanded definition should be included in the definitions section of the GOG’s form production sharing agreement.

The term “Production Sharing” in Article 1.1(ah) refers to the mechanism described in Annex 4, the “Accounting Procedure and Profit Sharing Mechanism.”

The mechanism outlined in Annex 4 is actually a profit sharing scheme that is not necessarily associated with the concept of production sharing. In all other production sharing contracts we have dealt with, the separate clause on production sharing that is included in the text of the contract provides a comprehensive description of the elements of production sharing, whereas the accounting procedure merely deals with the cost recovery mechanism and accounting issues that are associated with the production sharing concept.

The right of the GOG to participate in the PSA as a “co-investor” is described in Article 3.3 on Government Participation. This clause is unusual because it requires the GOG to purchase the interest (up to 20%) from GPG for a sum to be agreed or in accordance with the formula provided.

Normally, the government’s exercise of an option to participate is not related to a purchase requirement. A government’s participation interest is usually “carried” until it exercises the option, after which the government begins paying its proportionate share of the operating costs.

The last sentence of Article 3.3 prohibits the GOG from reselling the “equity participation” interest without GPG’s prior written consent, which is an unprecedented provision in our experience.

Typically, the government is the party that dictates the terms and conditions of its acquisition of a participation interest, and, thereafter, there are no limitations on how it deals with it.

This last sentence of Article 3.3 serves to demonstrate that GPG was taking unreasonable positions and that the GOG must not have been aware of, or chose to ignore, the irregular nature of such a prohibition.

The decisions of the Advisory Committee established under Article 5 are only supposed to be “of an advisory nature,” which is not uncommon, but a tie-breaking vote mechanism was not included. This is important because all decisions are to be made by majority vote and each party has an equal amount of representatives on the Advisory Committee.

Gridlock occurs if the parties don’t agree to accept an independent expert’s advice and then arbitration is required. Although it should, the PSA does not include any details on the appointment of an independent expert.

In addition, the list of functions of the Advisory Committee contained in Article 5.3 are much more limited than in the production sharing contracts with which we are familiar. Nevertheless, as revealed in one of the Resolutions contained in the Advisory Committee Minutes, the Advisory Committee agreed unanimously to make certain “variations” in the work program attached to the Exploration License, thereby far exceeding its advisory authority and effectively amending the terms of the Exploration License directly and the PSA indirectly.

Article 6.3 provides that GPG’s minimum exploration expenditure for the Initial Exploration Period would be US $10 million. GPG had the option to deposit that amount in its bank account in Grenada or such deposit could “be replaced by a bond or any other financial guarantee.”

According to the Advisory Committee Minutes, it was agreed unanimously that it would be sufficient for GPG to obtain a certificate issued by GPG’s bank stating that GPG and its affiliates have enough funds to cover the minimum financial obligation.

The Committee’s Resolution referred to the certificate as a “comfort letter” and stated that it would be “accepted as a good and valid financial guarantee under section 6.3 of the PSA” because “a similar comfort letter has been accepted by the Government before for similar purposes.”

To the contrary, such a “comfort letter” is not regarded as being an acceptable financial guarantee in most countries that deal with production sharing contracts.

Article 7 on Relinquishment simply states that issues related to “relinquishment of all or part of the Exploration Licensed Area shall be governed by the relevant provisions of the Petroleum Regulations.”

Sections 17 and 34 of the Petroleum Regulations only refer to the relinquishment of a block, not a part of a block. Section 34(1) is written in such a way as to make a relinquishment an option of the holder of an Exploration License for a block, rather than as any kind of requirement.

In contrast, the standard relinquishment clause in an international production sharing contract contains a great deal of detail relating to the timing of the required relinquishments and the amounts of the area to be relinquished at such times.

For example, a contractor would normally be required to relinquish 25% of a block at the end of the initial exploration period, and the entire portion of a block that is not covered by development areas or Development Licenses at the end of the full term of the exploration period.

The approach taken by the Petroleum Regulations is, therefore, quite disadvantageous to the GOG because portions of blocks that are not being explored in a timely manner by a contractor should be relinquished to the GOG so they can be reconstituted as new blocks and made available for bid to third parties.


(Look for Part 111 in next week’s issue of THE NEW TODAY)

IMF: Grenada is a cancer patient in need of chemotherapy

A delegation from the Washington-based International Monetary Fund (IMF) in separate meetings with the Grenada Trades Union Council and Civil Society Organisations has painted a gloomy picture of the island’s economic and financial situation.

THE NEW TODAY understands that the IMF team likened Grenada to a cancer patient in need of urgent treatment, including chemotherapy.

According to trade union representative in Parliament, Senator Raymond Roberts who attended the meeting, the comparison to a cancer patient was made in relation to the country’s massive national debt now in excess of 2.3 billion dollars, which works to a debt of about $20,000 being owed by every living person in the State.

In a meeting lasting almost three hours, the IMF quizzed the trade union leadership on what supporting role they intend to play in working with the Keith Mitchell-led New National Party (NNP) government and the private sector to reduce the debt that is stifling economic activities.

Sen. Roberts said the IMF delegation made it very clear that government’s finances are in a poor state which cannot continue for any length of time and the members highlighted the fact that expenditure far exceeds revenue collection which is a recipe for disaster in the long term.

One of the members of the delegation was emphatic, stating that the IMF makes recommendations and that it is up to the country to determine whether it wants to take the medication or choose to implement alternative measures.

However, according to the IMF official, if Grenada does nothing to stabilise its economy, the consequences are that grants from other countries will be extremely difficult to access.

Sen. Roberts said the IMF did not specifically say what their medication would be but noted that increased taxes are necessary for the government.

Asked about Dr. Mitchell’s philosophy that workers who make less than $60, 000 a year be exempt from paying personal income tax, the IMF said that Grenada and St. Kitts – which have two of the most depressed economies in the world, are perhaps the only two nations with such a huge threshold.

The IMF delegation told Union Leaders that Grenada’s financial problem is colossal and one official reflected on Barbados in the 90’s under then Prime Minister Erskine Sandiford which resulted in a cut in public officers’ pay by eight percent among other revenue raising measures.

The official pointed out that Grenada is facing a similar situation and it is almost crisis time.

Sen. Roberts said the IMF also touched on the much talked about hair cut being proposed by the Mitchell government for its U.S bond holders and institutions that provided Grenada with commercial loans over the years.

The delegation said that the bond-holders are expecting to be treated fairly by government and do not expect them to accept zero.

Since assuming office in February, the cash-strapped Mitchell government has defaulted on its March payment of US $9million to the bond-holders.

The government was expected to make another payment of approximately $19 million in September but has not made any official pronouncement on whether it will make the payment or default once more.

Sen. Roberts noted that Prime Minister Mitchell has boasted that he was able to pay public officers’ salaries on time, but makes no mention that the government has not honoured its debt obligations to its creditors and that the interests on the debts continues to increase.

Much of Grenada’s debt was accumulated during the first 13 years of the Keith Mitchell reign from June 1995 to July 2008.

Several of the unsustainable debts came from commercial loans borrowed at high interest rates of around nine percent from a Merchant bank in Trinidad, in which the Ansa McCall Group is a dominant player.

One of the loans was taken out to refurbish the Maurice Bishop Internatoinal Airport at Point Salines.

Sen. Roberts pointed out that while the trade unions support the government’s desire to grow the economy and create jobs for workers, “we are all aware that IMF prescriptions include the pain of austerity measures – which mean job cuts in the public service, and cuts in social programs, among others”.

He said his greatest concern is that the population is not being prepared by the Mitchell government for the challenges that lie ahead for Grenada.

“When you listen the Prime Minister at his Town Hall meetings, the impression being given is that happy days are here again”, he remarked.

According to Sen. Roberts, some people still do not comprehend the reality that the country does not have any money and the situation is indeed deteriorating.

“And what is worse is that the hundreds of investors the Prime Minister boasted about who were lining up to come here to do business just can’t arrive; neither have the ten thousand jobs. “, said the outspoken trade unionist.


‘I live for the day when campaign promises become hardcore reality’

By Gordon ‘Butch’ Stewart

I’m convinced that we must start with a renewed approach to how we structure the Government and its organs to achieve economic resuscitation. The old non-productive model that we are still hanging onto, will not take us out of this quagmire.

In the course of my extensive work and travels through the Caribbean, I have seen first hand the economic stress from one end of the region to the next. However, in response to the severe financial constraints, the various governments have been reaching out to their people and companies which can make a difference.

One of the key approaches has been tax reform. Every country that is looking to move ahead has accepted that it is just not possible to make ends meet and achieve growth by a never-ending process of imposing higher and higher taxes on the same people and the same organisations. That is one of the most debilitating obstacles to growth of the Jamaican economy.

When businesses are doing well, the Government collects far more taxes. Right now, business in Jamaica is just not good. That is the clearest indication that a philosophy of tax and more tax will not work. All it achieves is driving more and more of the economy underground as businesses struggle to survive. The current taxation stream is slowly drying up at a time when the Government needs even more revenue.

Borrowing is a scourge

The alternative has always been to borrow more money and thereby compound the existing problem. That is the Jamaican story, where our debt is now over 130 per cent of our Gross Domestic Product. Even schoolchildren now know that we cannot continue to borrow at this frenetic and suicidal pace.

Borrowing is a scourge. There was a time when the ability to attract loans was glamourised and construed as a great achievement on the part of a Government. But there is nothing heroic about borrowing. We have got to be in a position to stand on our own two feet.

A smart government will start making creative deals through creative policies that investors, local and overseas, cannot refuse. Jamaica, with its natural resources, starting with our people and natural beauty, begins with an advantage.

There are patriotic and nationalistic investors who will strive with might and main and spend their last penny to develop businesses, but they need help through concessions from the Government, which must be an enabling partner.

If other Caribbean countries are doing it, there is no reason we shouldn’t. These are small countries with small resources, but they are doing everything to capitalise on anything that they can leverage for economic growth to make life better for their people.

One of the assets we don’t seem to recognise enough and use to our advantage is the fact that Jamaicans are extremely ambitious and willing to work hard, given the opportunity to do so. The stories of Jamaican successes achieved after migration are not myths.

When Jamaicans migrate

I have had the privilege of travelling all over the world and seeing many of these Jamaicans at work. Some are highly successful and just about all are focused on getting the job done well. It’s amazing to me that, here at home, so many people find it so hard to replicate the same effort and approach, or to find the motivation to make good of ourselves.

Of course, the system itself makes it extremely difficult. A young person trying to start a business will constantly run into a brick wall. I suggest to any serious politician that they accompany such a young person through the process and witness the bureaucratic red tape that is waiting to strangle them.

Start with clearing goods from the wharf. The convoluted bureaucracy, red tape and stupid policies will frustrate even the most optimistic young professional. It gets worse if he or she wants to start exporting which, ironically, is what our country so desperately needs. There are more agencies and more madness to encounter around every corner.

It takes a very big and nimble business which can afford to employ enough people to overcome the red tape. I’m appalled at how difficult it is for us to accept the KISS principle – Keep It Simple Stupid!

Parliament, with its great debates and extraordinary sessions just can’t seem to find a way to rid us of this maze of convoluted and complicated bureaucracy, from getting a tax compliance certficate to a driver’s licence.

Smart government

Instead of empty proclamation after proclamation, let’s get back to the KISS principle and watch the astounding progress that we will make.

To be sure, we have talked a great talk over the years with little to show for it. And nothing will change if we don’t get beyond talking. The bureaucracy gatekeeper have got to be trained to get things done, and to get rid of the approach that says, ‘it can’t be done’.

A smart government will also keep as a constant companion a business think tank, similar to a kitchen cabinet comprised of patriotic men and women of quality who will provide honest advice. In other words, this will be a sharp business advisory board that will come up with clever ideas on the way forward from a business perspective.

Not only must the Government be prepared to do so, it must be prepared to listen and to accept sound advice and get it done.

It pains me to see that other Caribbean islands – some without nearly as much resources, human or natural, as we have – making so much out of so little. We have somehow lost the drive to get things done here. Things that should be simple, like constructing a building, become so complex.

I recall Bruce Golding, while campaigning for the 2007 election, making a big deal about development and the application process, and promising that under his Administration if there was no feedback from the relevant state agencies after 90 days it should be taken that the application was approved. Many of us applauded that.

But it was not done. I don’t know whether that was because of the distractions of office or a lack of courage, but I strongly believe that the system has to be forced to make things happen. Otherwise, it just will not move.

Exchange controls

When former Prime Minister Michael Manley rolled the dice and relaxed foreign exchange controls, almost everyone felt that was suicide, and I know there are some who still believe that. But imagine how bad things would have been if exchange controls were on top of the bureaucracy that we have today!

In my view, exchange liberalisation saved our business life. It took enormous courage of the kind we need today.

We have a Government that I believe means well. I repeat, what it now needs to do is set up this get-things-done apparatus driven by smart business people who understand the lay of the land and are willing to give of their time and advice.

The alternative to smart government is that we will live our lives tightening our belts, going from IMF agreement to IMF agreement, and getting deeper and deeper in debt, with smaller and smaller numbers of successful people and, for sure, greater disparity between the wealthy and the poor.

I live for the day when the campaign promises become hardcore reality. Let us stop the constant speech-making that means absolutely nothing.

(Gordon ‘Butch’ Stewart is the Chairman of Sandals Resorts International, the parent company for the soon to be opened Sandals-La Source Grenada at Point Salines)