Tough decisions needed to tackle ECCU debt – Montserrat Premier

ST JOHN’S, Antigua – Montserrat’s Premier Reuben Meade said Antigua & Barbuda and its neighbours need to take tough decisions to tackle rising debt in the region.

Meade’s comments follow Grenada’s announcement it will default on regional bonds and treasury bills – which analysts argue will harm the Eastern Caribbean Currency Union (ECCU).

Meade’s suggestions for regional governments include cutting the public sector and limiting domestic borrowing.

“Are our civil services operating as efficiently as they can? My answer is no and sometimes one needs to look at, do we need to cut the public service?” Meade queried.

“Or do we need to restructure the public service as we are doing in Montserrat? For example, we are outsourcing quite a number of things which the public service was seen as the one which had to do them,” he added.

Meade also suggested the region needs to cut costs by working together on overseas representation.

“Overseas representation is not cheap, but all of us tend to have our own little offices and embassies scattered all over the world. What we need to be doing is to save money between ourselves and have collaborative overseas representation,” Meade said.

The Wall Street-based Moody’s Investors Service said Grenada’s default would increase the costs of short term financing for ECCU members like Antigua, which issue bonds and treasury bills regionally.

ECCU members include Anguilla, Antigua & Barbuda, Dominica, Grenada, Montserrat, St Kitts and Nevis, St Lucia and St Vincent and the Grenadines.

Moody’s said regional GDP shrunk at an average rate of 2.1 per cent in the last four years and that it expects “only a modest recovery in 2013.”

(More in today’s Daily OBSERVER)