Current affairs analyst Arvel Grant is projecting that the local economy will not recover this year but the government’s fiscal consolidation programme and assistance from the International Monetary Fund (IMF) just may be the saving grace for the country’s finances for 2010 and future years.
His comments were made in an interview yesterday with the OBSERVER Group.
“… My own sense is that the fiscal programme that the government has embarked upon in respect of trying to reform and include the functioning of the public sector, while at the same time seeking to move in the direction of a balanced budget with some support and oversight by the International Monetary Fund, I think that is going to be key to how Antigua & Barbuda works through this year and subsequent years from now,” he said.
Predicting that this year will pose financial challenges for the country, Grant said it is important that last year’s constraints to the economy – including the Stanford fallout, decline in tourist arrivals, leakages in government’s revenue collection system and the spike in crime – are addressed, if the nation is to find ways of boosting the economy this year.
He said the current state of the economy is a result of a “chronic fiscal problem,” in which there was very little discipline in the use of the public’s resources.
“A lot of plunder of public assets must have taken place over the decades, and because of that, the potential of Antigua & Barbuda to grow and to have sustained economic growth and economic development have been challenged by that,” the analyst said.
The aim, therefore, must be to boost the economy so that revenue can expand steadily rather than the “jagged-edge” development the island has had over the years, Grant noted.
Turning his attention to immigration and its effect on the economy, he said the population of the country must be taken into consideration.
“The smaller the population, the less sustainable the economy is, …” Grant said. “There has to be a plan afoot to achieve continuous growth in population and sustainable growth in population in order to undergird a credible economic development activity.”