A commitment to debt restructuring was given by the New National Party (NNP) of Prime Minister Dr. Keith Mitchell in its manifesto for the just-ended February 19 general elections when it took over the reins of power from the National Democratic Congress (NDC) of Tillman Thomas.
The NNP highlighted the issue of debt restructuring as part of its plans to build a “New Economy” for Grenada, Carriacou & Petite Martinique.
Prime Minister and Minister of Finance, Dr. Keith Mitchell announced that the national debt now stands at EC$2.2 billion
The last time Grenada engaged in restructuring its national debts was in 2007 – shortly after the island was hit by Hurricanes Ivan and Emily – which affected its ability to pay creditors.
According to the NNP, the building of a “New Economy” for the island is critical to job creation and ensuring sustainable economic growth.
The Mitchell-led party promised 1500 jobs for the youth in its first year back in office, as well as 2500 new jobs in the economy from initiatives that it will be undertaking.
As a public service, THE NEW TODAY reproduces the section of the NNP manifesto that gives details of its plans to build a New Economy for Grenada.
A NEW ECONOMY
World Class Tourism Complemented by an Efficient and Equitable Macro-Economy
Fundamental to our goals as outlined in our Vision of Grenada, is the development of that we refer to as the New Economy.
The “New Economy” envisions a world class tourism, yachting and marina destination, complemented by efficient business, finance and information technology services, an efficient light manufacturing sector, competitive agri-businesses producing a diverse range of food and agro-industrial products and services dedicated to oils and gas and renewable energy sector.
Grenada is suffering the effects of a deep and protracted global recession. However, the country’s current economic downturn is linked directly to “home-grown” factors.
Over the last four and half years, Grenada has suffered from the absence of a clear development vision, weak leadership and consistently poor decision-making at the expense of jobs and our people’s ability to earn a decent living.
It is clear that with a more prudent approach to economic management, strategic economic policies and effective governance, much of the present rates of joblessness, high levels of poverty and low levels of investment and business confidence could have been avoided.
The NNP views the creation of a stable economic climate, the facilitation of an enabling environment for growth, and job creation as top priorities which can be realistically attained even as we mitigate the impacts of the global recession.
We pledge to restore confidence in Grenada’s economy. We commit to create an environment in which Grenadians can shape their own destiny through free enterprise and hard work. We assure all citizens of a Government which makes strategic economic decisions that will benefit our people.
JOB CREATION: THE KEY TO ECONOMIC SUSTENANCE AND WELL-BEING
The rate of unemployment in Grenada has more than doubled between 2008 and 2012. The only sector where employment figures show an increase is in the established public sector, of nearly 6%.
The NNP understands the challenges of recession, but will not be distracted from attending to what matters most to Grenadians – a stable job which enables us to support our families and achieve our personal goals.
An NNP Government will reduce unemployment through action aimed at:
• Stimulating private sector activity, by:
*improving fiscal incentives, by repaying claims due to private sector firms, as a matter of priority. We are already far advanced in a strategy to do so;
*supporting the establishment of private sector entities via small and mirco-enterprise financing;
*establishing a strong and dynamic “Investment and Equity Fund” anchored in Grenada to finance viable development projects in Grenada and elsewhere.
• Revitalizing key economic sectors, by:
*implementing a genuine “ Economic Stimulus Programme” for agriculture, construction, manufacturing, ICT, business and financial services;
*initiating six major private sector development projects in the Tourism and Hospitality sector within the first year, and establishing a Fund for Distressed Hotel Assets, in exchange for an undertaking by hoteliers not to cut employment further, and where possible, to re-hire staff;
*securing markets for Grenadian agricultural products, through trade agreements within and outside CARICOM;
•Increasing opportunities for job-creation and self-employment, including introducing:
*four new youth programmes which will provide training and temporary employment for 1, 500 youth, within the first year;
*2,500 new jobs in the economy from the above programmes, actions and interventions, and another 1,000 jobs in Years 3,4, and 5 of the Administration.
RECOVERY, SUSTAINABLE ECONOMIC GROWTH, EMPLOYMENT AND ECONOMIC JUSTICE
Grenada’s “New Economy” must provide job opportunities for those who wish to work; business opportunities for those who choose to invest; opportunity for wealth creation and prosperity for those prepared to sacrifice and play by the rules; and social justice for all who believe in equality and human rights.
Our approach to stewardship of the economy is underpinned by:
•Recognition that the private sector and non-state cooperative enterprises are the engines of our economic system; they drive entrepreneurship, innovation and investments; they build firms, economic actors and social capital in all of the traditional, non-traditional and emerging goods and services sectors;
•Commitment to prudent public policy-making that enables private sector activity, efficiency in the civil service and government business, and effective policy implementation and enforcement, resorting to direct intervention in productive endeavour only in exceptional circumstances;
•Adherence to strong macro-economic fundamentals appropriate for small, open Caribbean economies, including the commitment to a stable currency though the ECCB, re-negotiation of Grenada’s debt, sustainably low rates of inflation, prudent fiscal management, a fair and competitive regime of internal taxes, economic diversification and specially designed “confidence-building” initiatives;
•Pursuit of deeper integration in the OECS Economic Union and the CARICOM CSME and more effective participation in international markets, to reposition the country to seize on emerging trade and economic development opportunities, including in Information and Telecommunication Technology and Services, Financial services and Education;
•Recognition of the need for continuous investment flows by attracting domestic -(including CARICOM) and foreign investors into high-growth sectors and high employment industries, accommodating the entry of credible financial institutions in Grenada to support the development of investment and equity funds and micro-financing.
The NNP will pay specific attention to:
• Prudent fiscal management, giving priority to:
*achieving and maintaining a “balanced budget” while allowing for small manageable fiscal deficits, as necessary to facilitate the development objectives of the country;
*ensuring that public expenditure be kept under continuing review to promote efficiency in the economy and in the use of fiscal resources;
*maintaining a tightly managed debt accumulation strategy targeted at the reduction of both domestic and foreign components of the national debt.
• The tax regime, taking measures aimed at:
*restructuring all indirect taxes to make them more transparent, equitable and market-based, particularly property taxes;
*comprehensively reforming the tax system to improve taxation efficiency by avoiding over-taxation, strengthening compliance and implementing taxation policies that act as an incentive to greater investment and productivity growth;
*overhauling the VAT to improve its efficacy and simplify its operations;
*reforming the Environmental Levy to remove discrimination and enhance its effectiveness as a genuine environmental protection mechanism.
•Job Creation and business development, developing measures to prevent further job losses and expand employment creation in existing and new enterprises, such as:
*deploying aggressive strategies aimed at shielding consumers and the productive sectors from cost increases and ensuring that lower prices negotiated from international trade agreements are passed on to consumers;
*establishing new financial/technical assistance, capacity-bulding and institutional support measures to ensure small and medium-sized enterprises to recover and reverse the spiral of job losses;
*re-starting critical development zones and projects in St. David’s, St. Andrew’s, St. Patrick’s and St. Mark’s;
*offering concessions for persons setting up green businesses;
*abolishing the Alien Land Holding Licenses for CARICOM Nationals, with immediate effect, consistent with Grenada’s CARICOM obligations, and, within the first 100 days, streamlining the criteria for the issuance of Alien land Holding License to non- CARICOM nationals.