Grenada Today - The National Newspaper of Grenada, Carriacou & Petite Martinique

by Luis Araujo

Port-of-Spain, Trinidad - Anybody who heard Timothy Antoine speak last week Tuesday would know that he and Grenada are on a mission.

As Permanent Secretary in the Grenadian Finance Ministry, Antoine is at the forefront of the effort to get the country back on track and Tuesday's audience of bankers, insurance executives and businessmen were quite impressed by his presentation.

But that's the problem, only a small group of people would have heard Antoine's story and notably absent from Tuesday's event were representatives from Standard and Poors, the agency that has twice downgraded Grenada since Ivan struck in September. The other creditors will have to rely on S&P's reports and Grenada's debt plan when it comes out.

S&P's logic is clear: Grenada's productive sectors - tourism and agriculture - were destroyed by Ivan and were I a creditor, I myself would have been wondering how they would make future payments.
In fact, Grenada didn't make interest payments on a bond in December, prompting S&P to downgrade it again.

Grenada, though, signalled it would not be able to make the payments and RBTT, which organised the bond, complemented the country's government on the straightforward way it went about the decision.

Again, that's the problem. Creditors would have read the S&P report about the missed payment. They would have heard RBTT's comments only if they had read the Guardian. I guess it's not by coincidence that RBTT arranged to have Antoine speak to investors. The bank has already felt the effects of Grenada's downgrade on its books and probably wants the financial community to know that all is not lost on the Spice Isle.

There must be some way for investors outside of the Caribbean to hear Grenada's story too, to hear about what plans the Government has to get back on track.

The fact is that Grenada expects to grow this year, and increase on that growth in 2006. The country is banking on its cruise ship industry which has rebounded, hotel tourism and short term crops.
Consider the difference to the countries affected by the Asian tsunami. Forget the different scale of disaster for a moment. International creditors are looking toward a moratorium on debt and there has been no downgrade.

S&P stated that in Thailand, for example most of the economy was spared. There was no danger of not meeting debt commitments. Other countries in that region have been pressing for debt forgiveness or, at least a moratorium on payments.

Grenada, as far as I know has not asked for its debts to be wiped clean and while it did miss the interest payments in December, the fact that it has hired a team to come up with a plan for its debt means that it has not given up on payment. I guess we'll have to wait and see what plan Bear Stearns comes up with.

(Extracted from the Friday, January 27, 2005 issue of the Business Guardian in Trinidad and Tobago)