By Laurel Bain
By Laurel Theresa Bain
The focus of the 2023 national budget on the six priority areas, and the emphasis on the development of linkages which, if successfully implemented, should increase value added in the domestic economy and provide a path to transforming the economy. The transformation of an economy would take time, but the economic and social changes must be evident during the transformation process. The impact of policies, programmes and projects for transforming the economy would depend on effective implementation based on consultation and coordination among Ministries and government entities and with the private sector.
A common feature of Small Island Developing States is the high dependence on the importation of a wide range of goods and services. Grenada is no exception, and similar to the other countries of the Eastern Caribbean Currency Union [ECCU], Grenada imports a variety of goods and services. A component of transforming the economy should be to curb the growth in payments for imported goods and services by utilizing local resources.
The dominance of economic reports on merchandise trade and tourism conceals the payment to external providers for services such as repairs and maintenance services, construction services, financial services, use of intellectual property, and personal, cultural and recreational services.
Therefore, the education policies to synchronise the school curriculum with the education and skills requirements of the economy, and to develop vocational training should increase the availability of these services locally and curb the growth in the use of foreign exchange for their importation. Increased inflows of foreign exchange from trade in services could also be boosted by the development of the creative and digital economy. These industries, not only have the potential for increased exports of culture, recreational and personal services, but for utilizing untapped human resources to reduce unemployment, particularly among the youths. An integrated economy would be manifested by increased value added through linkages between agriculture and tourism ; with the tourism industry also benefiting from the creative and the digital economy, and supported by the reforms in the health and education sectors. As part of the strategy for the development of the creative and digital economy, an interim package of tax incentives was granted. The technical committee for reviewing the fiscal incentives would need to work diligently to undertake a comprehensive redesign of the fiscal incentive regime to support the emerging sectors.
Along with the economic policies that could lead to an integrated economy, are the supportive policies for governance and institutional rebuilding, foremost of which is pension and public sector reform. It is hoped that the Pension Committee would bring closure to the issue of pension reform, which has confronted all the countries of the Eastern Caribbean Currency Union. As early as 2005, the Monetary Council of the Eastern Caribbean Central Bank established the Commission on Pension and Pension Administration Reform [Pension Commission] to address the issue of pension and pension reform in the ECCU, and its report was submitted to the Monetary Council. However, the Grenada situation is complicated by the ruling of the Court and the Constitutional provisions, which would inform the work of the Pension Committee.
In the provision of public services, the public sector reform would need to include streamlining the public service to focus on its core functions of providing professional services as envisaged in the Constitution. Much could be done on reforming organisational structures and streamlining procedures and processes, this is necessary but not sufficient for an efficient public service.
Public officers must take personal responsibility for being professional, but this must be supported by good management and accountability through a robust performance appraisal system.
Under the pillar for ‘Strengthening Regional and International Cooperation’, I make a stronger plea for strengthening the OECS Economic Union. There are benefits to be derived as a country and for individuals who do business and interact within the OECS Economic Union. A public awareness programme could contribute to people maximizing the benefits of the Economic Union.
As the country develops agro-processing and the creative and digital economy the benefits from operating within the wider CARICOM could also be exploited. The scope and avenues for penetrating markets based on CARICOM agreements with the Dominican Republic, Costa Rica, Colombia, Cuba, and Venezuela could be explored.
The policies for addressing the current inflationary period focused on providing targeted relief. The exemption of the sanitary products which is described in economics as inelastic in demand, that is, whatever is the price, the products are needed and must be purchased, should bring some relief to the lower income groups. In this environment, where social and business transactions are undertaken electronically, electricity and internet services are also necessities, and the relief has both social and economic impact. The increase in the tax on alcohol and cigarettes, which serves as a revenue raising measure and a deterrent should be monitored. It could have unintended impacts such as illegal trade, and a reduction in household disposable income as there is increased allocation for the products, accommodated by the reduction in the purchase of other consumer items.
Government finances were stable, with a current account surplus of $308.9M or 8.9 percent of GDP. The comparatively high current account surplus was due to higher non-tax revenue as a result of the reclassification of inflows from the Citizenship by Investment Programme from grants to non-tax revenue in 2023. This reclassification does not affect the overall balance after grants which is an indicator of the impact of government operations on the public debt. The overall surplus after grants is estimated at $62.7M or 1.8 percent of GDP for 2023.
The information on the public debt continues to be restricted to the Central Government, and this could be one area for education of the public on the concept of the public debt. The focus of the budget on increasing linkages and improving value added in the economy should lead to an integrated economy, with the capacity to increase output, exports and employment. The achievement of a well integrated economy with low levels of unemployment and poverty should be the outcome of an integrated approach to development.
Knowledge is power and experience is the greatest teacher
Article by Laurel Bain.
The late Sir K Dwight Venner, who served as Governor of the Eastern Caribbean Central Bank [ECCB] from 1989 to 2015, contributed significantly to the development of the ECCB and the Eastern Caribbean Currency Union [ECCU].
Sir K Dwight Venner was a visionary leader, and a strong advocate for the OECS Economic Union, while, at the same time, protecting and defending the strong and stable Eastern Caribbean [EC] dollar. Sir K Dwight Venner constantly withstood the pressures to devalue the EC dollar.
During a consultative engagement, when asked by a representative of an international institution whether the appreciation of the EC dollar wakes him up at nights, Governor Venner’s response was: ‘I do not sleep at nights’. This closed all further discussions on the devaluation of the EC dollar.
Governor Venner was a regionalist. On becoming Governor of the ECCB, the regional nature of the Bank was upgraded. After the construction of the Headquarter building in 1994, the flag of all the member countries of the ECCB were prominently featured on the compound. Regional institutions, such as the Eastern Caribbean Stock Exchange [ECSE] and the Eastern Caribbean Home Mortgage Bank [ECHMB], were facilitated along with the development of the Regional Government Securities Market [RGSM].
The institutions were housed at the ECCB Headquarters, and their staff participated in the economic and social activities of the ECCB in keeping with the spirit of deepening regional integration. In promoting the regional integration vision, the ECCB accommodated a flag raising ceremony on the date of independence of each country with the singing of the National Anthem, and the display of culture and products of the island. The economic and cultural display of the islands were reinforced by the institutionalization of Island Night.
The performance of the Grenadian contingent at the Bank was of added interest to Sir K Dwight Venner. Governor Venner was a proud student of the Grenada Boys Secondary School [GBSS], so the display of Grenadian talents and culture had to be upscaled. On one of the Island Night, the Grenadian contingent displayed the economic, political and social life in Grenada in a medley of songs and dances, with the songs featuring memorable lyrics of: ‘ When you see me in the cold mountain, what a planting…; Island in the sun with beautiful beaches and lovely people…; We shall never let our leader fall…; Forward march against imperialism…; and Dry weather house doh worth a cent….’With Arthur Campbell, a currently well-known entrepreneur, as the guitarist, the performance climaxed with the singing of the song with the lyrics: I must go back, my little island is calling me, by the now Honourable Lenox Andrews.
This was followed by the sharing of oil down from a big iron pot which was brought up from Grenada specifically for the cooking of the oil down. The now Honourable Dennis Cornwall efficiently managed the cooking of the oil down, a dish which became famous at the ECCB. On another occasion, the Grenadian contingent imported the talent in the form of the late Mighty Defender who sang about the stability of the EC dollar. With the experiences of regionalism, it is hoped that the Ministers of Government who were part of the process would continue to push for the strengthening of the OECS Economic Union.
Sir K Dwight Venner was an ardent researcher and with the support of the late Ms. Alison Phills, the ECCB librarian, a first-class library was developed at the ECCB. Ms. Phills, with the support of the library staff, meticulously sourced, recorded and organized the documents in the library; managed the collection of scholarly journals; sourced the newspapers from each member country of the ECCB; managed the exchange of documents with the staff of the Bank; archived the historical records; and embraced the move to the electronic platforms. Based on her interactions, Ms. Phills was concerned about the information gap that existed on the ECCB. This motivated her to publish the first book on the history of the ECCB entitled ‘The Eastern Caribbean Central Bank: Some Key Historical Facts’, which was launched on 21st February 2019.
The gathering of information and the sharing of knowledge were common to Sir K Dwight Venner and Ms. Alison Phills. On request, Ms. Phills organized Governor Venner’s quiet research time in the library. Thereafter, Governor Venner and Ms. Phills would converse as they shared some commonalities namely, the interest in information, the same birthday of 21 January, and the same nationality of St Vincent and the Grenadines.
May the legacy of Sir K Dwight Venner and Ms. Alison Phills live on.
By Ms. Laurel Bain who served at the ECCB for over twenty-five years along with the late Sir K Dwight Venner and the late Ms. Alison Phills. January 2023.
Technology is both a benefit and a cost to society. While technology brings improvement to jobs and daily lives, it also brings a cost. Technology makes life easier; businesses can produce more with the advancement in technology but at what cost. Some may view technology as beneficial to society while some worry about the effects of the improvement in technology to society. This topic is important because the use of technology is advancing rapidly. It has improved business operations and daily lives. However, person rely so much on technology that they are forgetting certain skills and are becoming too dependent on technology to do basic tasks.
The ethical challenge that is being developed is the growing costs of education to society, students, and educators in pursuing such a model with inherent
conflicts. The conflict would be whether the students are really learning what
they are supposed to be learning and whether the teachers are teaching solely
for profits or because they love to teach. Education has become a very successful business that is being marketed. Due to the mixture of businesses practices and principles in education, schools are more competitive and are branded to attract more students. The ethical challenge is that there is a growing cost of education to society.
Market research is the attempt that businesses and entrepreneurs must
take to learn more about their customers and the market they are operating
within. Market research provides a lot of advantages for small and large
business. Some businesses may not see the need for market research as they
believe they have understood what their customers want. Therefore, some
companies fail or would allow the competition to take over. Where one company fails to do what is important or required for the business, they competition would not do the same. The competition would take advantage of this opportunity to conduct market research and satisfy the customer’s needs.
A business plan is a document that should be created to detail the
present and future operations of your business. The goal is to outline the
objectives of the business and the means of achieving these objectives. Many
entrepreneurs create a business without creating a business plan as they may
not see the advantage of creating a business plan. Anyone can create a small
business but with the right planning it can be a successful venture and maybe
develop into an enterprise or a corporation.