PM challenges Eustace’s statement on economy

Prime Minister Dr Ralph Gonsalves has rejected the charge by Opposition Leader and President of the New Democratic Party (NDP), Arnhim Eustace that the economy of St. Vincent and the Grenadines is in “a total mess.”

Making reference to a recently released International Monetary Fund (IMF) consultation report on St. Vincent and the Grenadines, the Prime Minister on Monday, dismissed Eustace’s comments on the economic performance of the country.{{more}}

Unapologetically, Dr. Gonsalves questioned the basis of Eustace’s statements on the economy.

“Every single year from 2001, within months of us taking office, the leader of the Opposition has been saying that the economy of St. Vincent and the Grenadines is in shambles, and the recent formulation is that it is in a mess. … I believe that when we speak to the people we must speak truthfully and with the facts. It is not that everything that the IMF reports is gospel, but he (Eustace) was quoting the IMF,” Dr. Gonsalves chided.

At a press conference held at Democrat House last Tuesday, August 22, Eustace, a trained economist, expressed concern “that the Gross Domestic Product (GDP) is expected to consistently decline through to 2010 according to the IMF.”

According to the Prime Minister while the IMF report showed that the near-term outlook of the economy “appears broadly favourable”, the Opposition Leader continues to mention that the economy is in a terrible state.

“He said that immediate matters in this country are terrible with the economy, but in the very 2004 report that he is talking about, the estimated growth rate was in the order of 4.5 per cent, but the actual turn out was 6.8 per cent,” Dr. Gonsalves said. Citing from the IMF report Dr. Gonsalves said: “After having slowed in 2005, economic activity in St. Vincent and the Grenadines is expected to accelerate in 2006 to just over 4 percent, driven by a pick up in construction and tourism-related services, as well as a rebound in agricultural production. While inflationary pressures have emerged due partly to higher world energy prices, inflation has remained low, anchored by St. Vincent and the Grenadines’ membership of the regional currency union administered by the Eastern Caribbean Central Bank.”

In fact, the Prime Minister mentioned, inflation for St. Vincent and the Grenadines for last year and for the first half of this year – according to figures from the Central Bank – are lower than any other country in the Eastern Caribbean Currency Union.

“He preaches Dooms Day, but Dooms Day is yet to arrive in St. Vincent and the Grenadines…on the critical matters I am more the Leader of the Opposition than the Opposition Leader himself, they are dealing with sideshows,” Dr. Gonsalves lashed out.

Addressing this country’s dependence on imported oil, the erosion of trade preferences in bananas, and frequent natural disasters – areas in which the IMF considered as long term vulnerabilities- Dr. Gonsalves said all the critical issues his

administration continues to address have been scoffed at by the Opposition.

“We must not allow people to stylise the facts, including those who don’t have a commitment to speak the truth on these issues,” Dr. Gonsalves cautioned.