JANUARY 14th, 2006

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OF IMMEDIATE CONCERNS - LEVY, BUDGET, CSME
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By the time you are reading this, the looming crisis surrounding the proposed Five percent (5%) Government Levy Cum “Income Tax”, would either have cooled down, postponed to a later date, or reached alarming proportions.

The arguments on both sides of the line of division, which has created the crisis, have been forcefully and repeatedly put forward by the two sides - so that John Public now has a very good idea of their positions.

An interesting addition, to the latest round of belated discussions, has been the Chamber of Commerce which the Government has been ignoring for some time now, because it felt the Executive of that organisation were not supportive of its actions.

And for the last round of talks, which was scheduled to bring about the situation you now know about, the Government had also added to the discussions the Grenada Conference of Churches and the Employers Federation as relevant Social partners.

Interestingly enough, while all the arguments were going to and fro from many sides - those three bodies (Chamber, Federation and Churches) were not consulted publicly, or any other Social partner for that matter.

So it looks as though it is only the threat of Industrial action that has brought their relevance to the forefront, at this ninety-ninth hour as it were.
But be that as it may, another very significant aspect of those belated discussions - between the Government and the Workers representatives, regardless of who else were present - was that the Government spokesman was saying, after the Cabinet meeting last week Tuesday, that the date for the decision about the “Levy”,had to be in time so that it could be included in
the Budget later this month.
In other words, the so-called talks or negotiations were just window dressing, because the Cabinet decision that the “Levy” must be implemented as proposed, was in truth and in fact a fait accompli and there was never any intention to even meet the other side half-way.

It seemed to me, therefore, that the so-called talks were doomed before they started and that was a great pity - because any kind of confrontation or business disruption, at this stage of our rebuilding process and economic recovery, would be sending a far worse message to the Regional and International Community, than the over-emphasised 5% Levy Cum Income Tax.

There are some serious contradictions in the kinds of arguments, or justification put forward in support of the Levy. In one breath the Government spokesmen are all admitting that the people are under serious financial pressure, implying thereby that they cannot cope at this stage with additional financial burdens.

In the next breath all are admitting that the “Levy” is against their own vision for Grenada - yet they are insisting on its imposition at this time.

Even more baffling are the repeated number of occasions, the same Government people are boasting about how all those foreign visitors are praising the Government, and or the people for their marvellous recovery since “Ivan and Emily” - even the latest U.S. Congresswoman.

Well if all these are as stated then what further message do we need to send to Donors or possible Lenders? The latest Congresswoman apparently went as far as saying, that Grenada is a model example to the rest of the Hurricane ravaged countries, for speedy recovery.

So with that level of appraisal, why insist that known sufferers should be forced to make more sacrifice? And on top of all the debts and expenditures we already have to cope with - we now have a new Youth Ministry with a full Cabinet Minister to deal with finding jobs, or creating them, to solve the ever-increasing Youth unemployment problem that gets worse with every Graduation exercise from the Sixteen or Seventeen Secondary Schools, plus the Thousands from the Fifty odd Primary Schools.

Whatever comes out of the meeting that was scheduled for this week, as well as the decision or announcement that was due on the 11th January - the gloomy and daunting financial and economic situation will not disappear overnight.

And as for the political ramifications evolving therefrom, time, and the sincerity and resolution of the main players on centre stage, will surely tell as the situations unfold and develop.

Flowing from the “Levy cum Income Tax” decision, or resolution, will be the delayed Budget “goodies” or “baddies” that the Finance Minister has in store. I understand that Petrol and Oil prices have gone down on the World Market, so increases from that area should not be an issue.

But Government, through the Energy Minister had said, when we had that nearly 40% increase late last year - that the Government Tax would have been added by year-end. So I would not be at all surprised if that addition is to be included in the Budget Estimates.

However, in the midst of all that is now taking place around the Five percent Levy, and the Trade Unions threatened Industrial action in protest thereto - the Estimate themselves are faced with an additional problem in the area of Revenue Collection by Customs.

The Caribbean Single Market (CSM) is due to be signed into operation on the 23rd of January, in Jamaica. We know already that The Bahamas and Haiti are definitely out of the reckoning, but it is unclear how many of the OECS group would be ready by that date.

In our case the Prime Minister said in his New Year’s address to the Nation, that the Government was simply making sure that all the legalities were in place before joining those who will be ready this month.

By the end of the first quarter of this year, was quoted by the Minister of Finance for our entry. If that is in fact going to be the reality, there has to be some mechanism in place to deal with the issue of Customs Duty - on goods that are coming into Grenada from the States who will be part of the CSME.

I have not heard or seen anything from any source on that matter - so we must wait to hear the Minister’s wisdom come Budget day. The Single Economy is on hold until sometime in 2008, as well as the total freedom of movement of people and Capital across the region.

The Regional Development Fund (RDF) is intended to assist our Mini or less developed States to be able to compete with the Big Four. But while there is agreement on a sum that will be available to assist those Mini-States, the drawing-down and implementation of that Fund are yet to be worked out.

I have serious reservations about two aspects of the CSME, the Free Movement of Capital by any State to any State, and the Free Movement of people or Labour. The first concern puts us in the OECS at a great disadvantage, because we do not have the wherewithal to be able to compete with the More Developed Countries (MDCs); and the second is just as frightening on the question of Security, when one looks at the Criminal activities in Trinidad, Jamaica, and lately in St. Lucia.

The attempted comparison of the CSME with the European Union (EU) of the now Twenty-five or so States in Europe - is like Chalk and Cheese and greatly misleading by those trying to do so.

True enough, we need a greater measure of union or integration on the Economic and Trading fronts in particular - so that as a region we could speak in the Global Market place with one voice. But that cannot be put together overnight, it needed to be brought about in stages over the years - and that was not done.

Since the “Grand Anse Declaration” here in Grenada in 1985 or thereabouts, where the final decision was taken on the CSME, nothing, or very, very, little was ever done - except talk and more talk.

We had the West Indies Associated States (WISA), which was followed by the Organisation of Eastern Caribbean States (OECS)- where we have a Common Court System and a Common Currency, among other things, and there we had a platform on which to prepare for CARICOM as a whole - but that was never done. And even there the issue of Free Movement is still a very sore point just as the movement of Capital.

And among the Eight or Nine Mini-States sharing the Common Systems in the OECS, most areas of our sizes, population, production, economic base and such like, are very much alike or almost equal in shapes an sizes.

To overnight put those very vulnerable Mini-States, into a System or Organisation of so-called equality with the more Developed States - is creating man-made Social and Economic chaos that will do us no good,, in the short or long term as things now stand.

And talking about immediate concerns, over and above the areas listed in the headline - another very pressing concern, almost amounting to a State of Emergency as far as the Government is concerned - is the whole question of our National Stadium, and our general preparedness for the Cricket World Cup matches in Grenada in just about one year’s time.

Besides the physical building, and playing fields for the matches and places for teams to practice, many other bits and pieces have to be put in place to satisfy the requirements for a World Cup - NOT A TEST MATCH.

One of those is the question of the Hospital and supporting Health Facilities, for those many thousands who would be coming to Grenada - in an Emergency situation. Among our public Institutions that are not ready yet, is the General Hospital. We may well be getting Breaking News in that area sooner or later.

There can be no doubts that the weeks and months ahead, in the upcoming twelve months, are custom built to generate all kinds of chaos, and excitement, and more breaking news. And while as a people, at risk in more ways than one, we have to be prepared and always vigilant - those persons or organisations, and the powers-that-be, must never lose sight of their solemn and sworn responsibility, to act and operate always in the interest and welfare of ALL our people.

Grenada, Carriacou and Petite Martinique, after all is said and done, by all concerned - belong to ALL of us, and not just some of us.

Views expressed in these columns are those of the authors

 

 

EDITORIAL
Common sense will prevail
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Of Immediate Concerns - Levy, Budget, CSME
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