Then and now: The state of the Vincentian economy

Fri Nov 22, 2013

by Nilio Gumbs

So often, you hear the specious arguments being touted by some radio talk show hosts that the economy is fine, or on the contrary, the economy is in a free fall dive, without a capable leader to bring it under control. I lay bare the facts for many who may not be privy to such facts for formulating or making an informed judgement on the economy.{{more}}

My analysis of the economy goes back from the 1980s to the present, giving a comparative analysis of the economic performance of the country. The 1980s and 90s were was arguably the best economic times this country has ever experienced. However, this debatable and contentious view of the economy in the 1980s and 90s can only be digested after calibrating for changing circumstances in the post 1990s.

The 1980s and 90s saw spurts of high growth rates that have remained unsurpassed up to the present period. The trust by the New Democratic Party (NDP) administration in tourism, coupled with banana exports, led to spikes in economic growth of over 14 per cent in 1988, and close to that in 1997. During the period 1988-99, there was continuous economic growth, even though there were fluctuations over the time period in question.

Very early in the new millennium, a new government was ushered into power, with high expectations and hope, to bring about meaningful change in governance and people’s daily lives. The people’s yearning for economic improvements in their daily lives was partly answered by robust economic growth in the first half of the new decade, due in part to a construction boom involving the low income housing project. This robust economic growth soon dissipated with the advent of the global economic crisis in 2008.

The global economic recession in mid 2008 exposed the frailty of the St Vincent and the Grenadines economy, and unmasked and exposed the stewardship of the “Unity Labour Party (ULP) government” in managing the economy. The economy suffered during the years of economic contraction, bringing untold suffering to Vincentians. Even though exogenous factors were at play in the contraction of the economy (decline in remittances and tourist arrivals), the ULP government has to shoulder some of the blame in how they manage those factors under their control. The dramatic collapse of the banana industry lies squarely at the feet of the ULP government.

Other self-inflicted factors and indiscretions of the ULP government have contributed to the present economic malaise in the country. The relocation of some medical students of the St Georges University to Grenada, because of the government’s crassness in dealing with the school’s administration, significantly impacted on the economy. The destruction of marijuana fields is another factor that has contributed to the economic conundrum we are now in.

St Vincent and the Grenadines is the poorest country among the Organization of Eastern Caribbean States. The country attained the worse score on the 2007 Human Development Index, barring Haiti. And, Vincentians have to seriously prick themselves to find out why.

Too often our political leaders govern based on their personal emotions rather than sound practical and feasible considerations, imperilling the lives of over 100,000 souls.