Economic Growth in SKN Yet to Materialize Says World Bank Director (St. Kitts and Nevis Observer (St. Kitts and Nevis))
By LK Hewlett
World Bank Director for Latin America and Caribbean, Francoise Clottes
World Bank Director for Latin America and Caribbean, Francoise Clottes has noted concern that economic growth in St. Kitts and Nevis is yet to materialize despite debt reduction efforts.
Director Clottes spoke at the kick-off meeting of the St. Kitts-Nevis Chapter of the Caribbean Growth Forum held at the St. Kitts Marriott Tuesday (Feb 26).
“There is a much improved debt situation and this is the ground which is required for growth to take off, yet growth has not yet efficiently materialized and this is a concern of course, for all of us,” she said.
Hon. Dr. Timothy Harris, former government Minister who served as Finance Minister for a number of years told The Observer it was no surprise to hear the sentiments expressed by the World Bank official. He said the Federation has been facing the problem of growth for a very long time and only lip-service had been paid to some of the areas identified as engines of growth.
“In the context of St. Kitts and Nevis we ought to be concerned that over the past four or so years the growth return has been negative, which means every year things have become worse. And that is a frightening reality which we have to deal with and now find appropriate policy prescriptions to take us out,” he said.
Dr. Harris said growth has not been adequate coming out of the 5 areas Prime Minister Hon. Dr. Denzil Douglas highlighted as engines for growth in the Federation, namely Tourism, Agriculture, Information Technology, Financial Services and Light Manufacturing.
“In 2010 the growth rate was negative, 2011- negative, 2012- negative; and there is nothing in 2013 which tells us that the growth is likely to improve.”
He pointed to an uncertainty in the investment climate largely driven by the existing political impasse which he posited does not inspire confidence in the economy, particularly for local stakeholders.
“We have started the year on a very bad note,” Dr. Harris disclosed.
He said it was interesting that ECCB Governor Sir K. Dwight Venner spoke to the need for a growth rate between 5-7% in his presentation, however “we have not had that level of growth for quite a long time”.
Director Clottes explained that the rationale behind the CGF initiative is meant to address the issues of economic growth in the region, which she said has been structurally low.
“The financial crisis hasn’t helped and excessive debt has hampered potential for growth.”
She commended the St. Kitts-Nevis authorities for having made “tremendous effort to address the crises”.
“They have made substantial progress on the structural reform agenda to put the economy back on track. There is a sound fiscal environment. So we are partners in the second phase which is to build on the sound ground for success. It seems very clear at this stage that the collective effort is required under the circumstances.”
Director Clottes pointed out however that there is “no automatic recipe for growth” and financial resources, technical capacity and political will are all necessary ingredients.
She said it was necessary to engage in an action-oriented national dialogue around growth and development challenges with the specific purpose of identifying practical and implementable solutions that can be realized in the short and medium term.
“The focus is on action; the focus is on implementation. What is expected from this initial convening moment is further work, further identification of constraints, further effort in the direction of change, further implementation.”
Document Title: Economic Growth in SKN Yet to Materialize Says World Bank Director
Document Source: St. Kitts and Nevis Observer (St. Kitts and Nevis)