by Linda Straker
- EC$60 million scheduled to be paid to creditors for April to December 2020
- Government asking for deferment because revenues has dropped considerably
- Revenue from Customs about EC$12million short; Inland Revenue is over EC$10 million short
Grenada has announced that as part of its strategy to adjust to the negative fiscal impact of the Covid-19 pandemic, the country is applying to the international community for a suspension on EC$60 million which is scheduled to be paid to creditors covering the period of April to December 2020.
“We are now applying to the international community for the deferment of debt payments. We are expected to be able to make payment of more than EC$60 million between now and the end of the year-end,” Prime Minister, Dr Keith Mitchell, said on Wednesday.
“So, we are asking in this period of Covid that these payments not be removed completely, because in some cases these are commercial debts and people have to be repaid. So, what we asking for is a deferment, so for the rest of the year we won’t be expected to meet those payments because we can use a lot of those monies to help people, instead of having to pay out those resources at this time and to start paying again next year,” the Finance Minister said in an interview.
“We can only able to do this because our revenue has dropped considerably,” said Dr Mitchell in a telephone interview which was aired as part of “Hard Talk” – a daily talkshop hosted by the communication arm of the ruling New National Party that is aired by a number of radio stations and on social media platforms.
He disclosed that for the month of April, government received less than a third of the projected income as stated in the 2020 budget. “For the month of April, we were expected to raise over EC$30 million between Inland Revenue and Customs individually; and Customs have fallen about EC$12million short and Inland Revenue is over EC$10 million short. So, you can see the impact in just these 2 areas of revenue, we are not talking about some of the other areas,” he told the host.
“We are over EC$20 million short in resources and the government still have to pay public servants. That is a commitment we have to meet for those months, in particular, coming up…We have taken a tremendous hit as far as revenue is concerned,” he said. The Prime Minister pointed out that government was able to meet public servant wages and salaries and some other local claims for the month of April.
“The only reason we are able to meet our commitment to workers in this point in time and be able to assist the marginalised in this time, is because of the way we have managed the economy. The saving we have had and the support we are getting from regional and international institutions. This is the fundamental reason for us to be able to do what we are doing,” he declared.
Grenada, Dr Mitchell said, has received support and contributions from a number of regional and international agencies and donors as part the island’s new measures in the immediate, short, medium and long term effects that the Covid-19 pandemic is having on economies worldwide.
Between the World Bank, the International Monetary Fund, the Caribbean Development Bank, the Eastern Caribbean Central Bank, the European Union and the United Nations Development Fund, Grenada has received more than EC$75 million as credit, grants or technical support in contributions.
I think that the PM should be more realistic about the $60 million in loan repayments due and seek to have those payment obligations taken off the books by the lenders. Its criminal to expect that we should repay those loans now: With SGU not re-opening until 2021, international flights cancelled until that date and construction in a state of free-fall, our GDP will contract by 40% to 50% in 2020 – which is a contraction never seen in history before. I am now convinced that we are NOT returning to the “old normal” at all. Therefore, I would strongly agree that its time to do a compete rethink about what we should be doing with our economy. A COMPLETE RE-THINK – not band-aid proposals to the “old normal”. And we need to start doing that right now!
Cabinet secretary in the US said today that he doesn’t expect international travel to resume until sometime in 2021. This would indicate SGU students would have to make some arrangement with what? This would also presume the winter tourist season of 2020/21 may be lost. Rather than wringing hands leadership should take this as an opportunity to mobilize a response to broaden the market. A first world health facility should be of primary concern. Better management of infrastructure could also be addressed during this time. Traffic patterns are dismal and fixable and should be. It shouldn’t be a life threatening nervous breakdown to travel around our little island.
These Comments by GEORGE are not reflective of recent Jet Schedules; in example – per AJC – Atlanta; May 01, 2020.
Delta Airlines is to restart some International routes, mid – May.
From Atlanta ( where I am now ) TO: Paris, St. Croix & also to St. Thomas.
Further restarts in second half of May include Peru, Costa Rica & Honduras. Also followed by to: Amsterdam, Mexico & San Juan.
American Airlines is also to restart several Caribbean & other Regional routes in May and early June.
These schedules are only published by the various airline companies so as to put pressure on the Government to lift travel restrictions. They are not thinking about our welfare, only their bank balance!
I agree that they, the Government, should be using this time to rethink their strategy on how as a country and a region we can become more self-sufficient, not just for now but for generations to come. Be more frugal and diligent when selecting our trading partners. If there is one thing that is apparent from this pandemic is the state of our health care system. This is where major investment both financial and vocational is needed.