‘We now have money on the bank instead of an overdraft,’ PM Douglas tells Chamber

BASSETERRE, ST. KITTS, DECEMBER 19TH 2012 (CUOPM) – St. Kitts and Nevis’ Prime Minister and Minister of Finance, the Rt. Hon. Dr. Denzil L. Douglas said Tuesday that the finances of the country are much stronger now than at the start of the global economic crisis.

The St. Kitts and Nevis leader told the business community that through the bold and effective policy framework established by his Government, the finances of the Government are much stronger now than at the start of the crisis in 2008.

“Specifically, in the last fiscal year we achieved a surplus on the current account, a surplus in respect of our primary balance, and an overall surplus from the fiscal operations of the Government,” Dr. Douglas told the annual Christmas Luncheon of the St. Kitts and Nevis Chamber of Industry and Commerce.

“Indeed, we now have money on the bank instead of an overdraft and the public sector debt of the Government has moved from nearly 200% of the GDP to some 130% to date,” said Prime Minister Douglas.

He said that this is an extremely rare and outstanding feat for a country of any size.

“We must put aside political differences and celebrate a truly outstanding accomplishment by the Government and people of our progressive Federation,” said Prime Minister Douglas.

He said that the public and private sectors in the Federation have been adversely affected by the global crisis that started in the US housing market in 2008 and has spread to nearly all sectors of the global economy leaving a trail of unemployment, business failures, unsustainable public debt, fiscal mayhem and economic despair that still linger on some four years later.

“Indeed, the United States of America has seen its debt move beyond 100% of GDP and it now stands on the edge of ‘fiscal cliff” that threatens to push its economy into another recession with adverse consequences for growth prospects around the world,” said the Prime Minister who pointed out that in Spain and Greece, the huge fiscal imbalances and massive escalation in debt have captured the attention of the international press but even more devastating is the level of youth unemployment, which in both of these countries, is in the region of 50%.

“In other words, in these developed European countries, every other young person is unemployed. Moreover, even China and Brazil that had seemed invincible in the early years of the crisis have been forced to significantly reduce their growth expectation,” said Dr. Douglas.

“It is not surprising therefore that, our own economy, like all other small island developing states, has suffered significantly from the impact of the global crisis,” Dr. Douglas said.