Government plans to further economic growth, create greater employment in 2016

The Appropriation Act 2016 which provides for the services of St Vincent and the Grenadines for 2016 was passed into law in the House of Assembly last Wednesday, without dissent.

The central theme of the 2016 Budget, which was presented and passed into law in the absence of the Opposition, was “Economic Growth, Job Creation, Zero Hunger, and Fiscal Consolidation Amidst Global Uncertainties.”{{more}}

The Estimates of the Budget total $912.9 million: Of this sum, Recurrent Expenditure accounts for $576.55 million; Amortization amounts to $116.67 million; Sinking Fund Contribution receives an allocation of $22.0 million; and Capital Expenditure is allocated $197.67 million.

A current account deficit of $11.9 million is budgeted in the Estimates, which is 58 per cent less than the budgeted deficit for 2015.

Prime Minister and Minister of Finance Dr Ralph Gonsalves said his government will seek, “vigorously, in the actual implementation of the 2016 Budget to reduce the extent of this budgeted current account deficit.”

He said each aspect of the thematic formulation of the Budget is pregnant with meaning for the people of St Vincent and the Grenadines.

“Our government’s emphasis in 2016 is to facilitate further economic growth, create greater employment, including more quality jobs, accelerate a five-year push (2016 to 2020, inclusive) to achieve zero hunger, and to consolidate our fiscal condition, not through austerity, but by way of prudence and enterprise.

“In 2015, the economy is estimated to have had real economic growth of a modest 1.4 percent. The International Monetary Fund (IMF) and officials in the Ministry of Economic Planning are forecasting a better real economic growth in 2016 of 2.2 percent, but still not yet reaching a robust medium-term growth target of 5 percent. Currently, the nominal Gross Domestic Product (GDP) at Market Prices is approximately $2 billion, an increase of some $200 million since 2010. The GDP at Basic Prices in Constant (2006) Prices in 2015 was estimated at $1.5 billion, above the ‘pre-crisis’ level of 2008; several countries in the Organisation of Eastern Caribbean States (OECS) are yet to return the ‘pre-crisis’ levels of economic activity.

“Financing Budget 2016 will be challenging within the context of the limitations of the small, open economy of St. Vincent and the Grenadines; the persistent structural weaknesses of an uncompetitive economy with colonial and plantation legacies; the economic slow-down in our regional and international partners; the uncertainties in the global political economy; and the on-going fallout from repeated recent natural disasters. Still, our country possesses a bundle of strengths and possibilities which ensure that we continue to meet the multiple challenges in our national condition with a solid measure of success.”