What are the alternative plans and proposals?

Fri Feb 15, 2013

Each day as we listen to various economic reports and prognostications about the global economy, it becomes harder to hold out much optimism for a way out of the long-lasting global economic and financial crisis.{{more}}

Over the last two years for instance – 2011 to 2012 — global output expanded by less than 4 per cent each year, with the 2011 figure of 3.2 per cent being actually lower than that of the previous year (3.9 per cent). The two major trading areas for the Caribbean — Europe and the USA — both continue to have sluggish (US) or negative (Europe) growth, with serious implications for our region. Even the bigger developing economies such as China and Brazil, have experienced a decline in their rate of growth.

Translated into the rough and tumble of politics, this spells problems for incumbent governments as economically-stressed electorates are prone to blame governments for their difficulties. For those in power, this bodes danger anytime elections are around the corner. In the USA, President Obama, in spite of much of America’s woes being brought on by the policies of his predecessor, had to shoulder the blame and had a tough fight to be re-elected over a normally very ordinary opponent.

The Caribbean is now facing its turn. The Gonsalves administration scraped home in 2010, but in St Lucia, the Stephenson King government was not so lucky. Incumbents in Grenada and Barbados are up against it in general elections next week. In Jamaica, the same set of economic circumstances which propelled Prime Minister Portia Simpson-Miller to power are now returning to undermine confidence in her administration.

It is perhaps fortunate to be in opposition these days. As politics go, one expects strong criticism by opposition parties of the performances of their respective economies and the placing of blame on the governments. That is all well and good, but in doing so, one would suggest that at least two things must be borne in mind. First, one must be objective, fair and truthful, taking the global and regional context into consideration. Secondly, there is the need to go beyond criticism and propose alternatives.

Sadly, in our context, neither of these criteria appear to be fulfilled. In the latter case, the stinging criticism of the Government is not matched with any suggestions as to the way forward; an alternative set of economic strategies to guide our country out of its current difficulties. In this, the electorate is being short-changed.

Compounding this, the refusal to acknowledge facts about economic performance does our country no good. We must be mature enough to be able to say that although such and such is the situation, had we followed the following policies (spelling out alternatives), we would have performed so much better.

The President of the Caribbean Development Bank Dr Warren Smith has just delivered his 2012 Report. It came three weeks after our own Budget debate in which the Prime Minister’s report of economic performance of our country was challenged by the Opposition. But the CDB Report corroborates the presentation of the Prime Minister. It lists real GDP growth for the OECS states for 2011 and 2012 as follows: Antigua (-3% and +1.2%), Dominica (1.9% and -0.5%), Grenada (0.4% and -0.7%), StKitts/Nevis (0.9% and -0.3%), St Lucia (1.0% and -0.3%), and St Vincent and the Grenadines (0.4% and 1.5%).

This is what the PM had to say in the Budget:

“Contrary to the baseless propaganda,… in 2011, of the six independent member-countries of the ECCU, only Dominica and St Lucia performed better than St Vincent and the Grenadines…..

“In 2012, the estimated real growth of the economy of St Vincent and the Grenadines……exceeds the estimated economic growth of every other member-country of the ECCU”.

Dr Smith’s Report substantiates these figures, so why is there this continued propagandising that our country is worse than all its neighbours? We are far from being out of the woods, but at least, in order to get there, we must first have a clear indication of where we are and, moreover, a precise plan of how to move forward. What are the alternative plans and proposals?