Parliament has approved amendments to the Grenada Investment Development Corporation (Amendment) Bill, 2016, with opposition Senator, Dr. George Vincent chiding Senators on the government side for not listening to the members on his side when the bill was first debated in the House last September.
The six-page document was passed in the Upper House last week Wednesday.
According to Minister of State for Information, Sen. Winston Garraway, who introduced the bill to the members of the House for consideration, said the intention is “to encourage further growth and development in the business sector after the International Monetary Fund (IMF) supported Home Grown Structural Adjustment Programme (SAP) would have ended”.
Sen. Garraway said the bill provides a platform for the creation of an “investment climate that will attract foreign investors and entice local investors to invest their monies into the economy.
“And we are succeeding in doing that,” he told the House, noting that “the bill as it is, when our developmental partners looked at it they recognised that there were some loose ends that if not tightened, after the home grown Structural Adjustment Programme has ended we can find ourselves reverting back to that place where we just came from.”
The IMF is expected to complete its 5th review of the country’s performance under the three-year programme on December 14.
Sen. Vincent, who welcomed the amendments, said they are seen as a “vindication” of arguments that were put forward by Senators on his side of the House when the bill was first introduced two months ago.
“That speaks to the issue of quality of the drafting or quality of the discourse…we have said all of these things that are (being) amended (then) but we were ignored, shrug off and told that we were talking nonsense,” he recalled.
“This Mr. President, we will not accept,” he declared, stating, “We would like you to listen to us…We have spent time to review the documentation and we ask that you give consideration to the contributions that we make on this side so that we don’t go back and forth to come here today with six pages of amendments, after only a few months after the bill was passed”.
“Next time listen to us not only the IMF,” he added.
Under the amendment, the Corporation is mandated to control the granting of concessions and other administrative and developmental issues within the country’s investment climate.
According to Section 4 of the principal Act, the Corporation was mandated to execute 12 functions, which Sen. Garraway noted, the IMF pointed out were too much for the GIDC Board and “would take away from the time to concentrate on the core function, which is to attract investors in the country.
“Our developmental partners are saying to us that the core function of the GIDC is to attract investment into this country. So let’s narrow the responsibility of the Board so that they can reach out to the international community to bring in more investment,” Sen. Garraway told the House.
Contributing to the debate on the bill, Labour Senator, Raymond Roberts welcomed the reshaping and refocusing of the GIDC and the provision for investors to know beforehand what level of concessions they are entitled to based on the magnitude of the investment.
However, he took issue with the new stipulation for foreign and local investors to be treated equally across the board in terms of the granting of concessions and the like.
“Local investors and foreign investors enjoying the same level of concessions across the board, to me it’s a bit of injustice to our locals. History will show that the stability of Grenada’s employment, really and truly are the local investors and while we appreciate the contributions that our foreign investors make there is absolutely no doubt to me that Grenadian investors should have some advantage” Sen. Roberts said.
Sen. Roberts also expressed concern that the IMF has become too influential in the governance of the country, stating that “the reason why the Washington-based IMF, has become so dominant in our life is because of the ill discipline period in the Grenada economic sphere between 1995 and 2008.”
Prime Minister Mitchell who has governed the island during that period has often been accused of engaging in an uncontrolled massive borrowing and spending spree in which the national debt sky-rocketed from 373 million E.C dollars in 1995 to EC$1.8 billion dollars in 2008.
Sen. Roberts took issue with the repealing of section 10 of the principal Act, which provided for the Corporation to comply to any general or special directions given to it by the Minister, which has been replaced with a new section to allow for the Corporation in the exercise of its powers and in the discharge of its functions, to comply with any general directive relating to policy and to any financial directive given to it by the Minister.
He expressed the view that the powers granted to the minister “can be heavily influenced” and reiterated a former call by the “Trade Unions Council (TUC) for the structure of these boards to be reviewed.
“There ought to be direct representations from the Grenada Trade Unions Council, the Employers Federation and our social partners or the civil society group,” the labour Senator said, noting that the inclusion of this level of “institutional participation is what would make it (the process) transparent and more open.”
Adding his voice to the sentiments expressed by Sen. Roberts was Political Leader of the main opposition National Democratic Congress (NDC), Sen. Nazim Burke who agreed that closer consideration ought to be given to the powers of the minister.
He said: “It is one thing to say that the minister must provide policy direction to the state-owned enterprises and statutory corporations.
It’s another thing to say that the Corporation must take financial directives from the Minister..”.
“If this principle applies to all of the statutory bodies including the National Insurance Scheme (NIS), should the minister come and give a financial directive to the NIS telling them what to do with their money? Is this how the thing is going to run? he questioned.
Sen. Burke noted that the other statutory corporations are going to be subject as well to the Fiscal Responsibility, Debt Management and Public Finance Management legislation, which are intended to apply to all of the state-owned enterprises and if the purpose here is to bring some check and control, is it that the minister is able to (issue) financial directives to these bodies? he questioned further.
“I don’t think that this is good for business,” Sen. Burke added.
Female Opposition Senator, Franka Alexis-Bernadine echoed Sen. Roberts’ sentiments suggesting that “there must be other ways to support local investors.”
She told the House that “the locals have been complaining that they are not getting the kind of support that they would like” to see coming from the government.
Private Sector Representative Christopher De Allie stood up once again in support of the government-sponsored bill.
The Grenada Investment Development Bill was passed in the Lower House of Parliament on November 11.
Prime Minister and Finance Minister, Dr. Keith Mitchell told the sitting that the amendments would augur well for improvements in the business atmosphere in the country and institutions like the GIDC.
He said that “the GIDC, sometimes had to do a lot of mundane things before it sends on its documents on to the Ministry of Finance,” a process which he described as a “long drawn out bureaucratic (one), which inhibits serious developments.”