Business

Mitchell warns Grenadians to brace for tough sacrifices

Friday, May 30, 2014    

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PRIME Minister Dr Keith Mitchell has told Grenadians that they should be prepared to undergo three years of "tough sacrifices" as the island implements a home grown economic strategy with assistance from the International Monetary Fund (IMF).

"Our citizens recognise that our country has been reeling from the effects of these difficult economic times. We have been faced with high debt, high unemployment, and low growth. We cannot negate that fact.

"What we can do, and have done, is seek assistance to develop our own programme to get us on a path to fiscal sustainability. We have solicited the help of the IMF and other international and regional organisations, and they have accepted.

"But, sisters and brothers, the road to recovery is arduous, and we implore your sacrifice and your patience. Our Home grown programme calls for three years of tough sacrifices," Mitchell said at an awards ceremony for a local hotel establishment.

"We are all feeling the pain, and no one enjoys this, least of all, me. I have stated countless times before, if we were provided a viable alternative to the austerity measures that we have undertaken, I would have been the first to embrace it.

"As it stands, this is the best way forward. But, my friends, it is imperative to remember that these measures are temporary," said Mitchell, who is hoping that the IMF would approve of the "Home Grown Structural Adjustment Programme" later this month.

In March, the IMF said it had reached agreement in principle with the Grenada government for a three-year US$21.9-million Extended Credit Facility to support an "ambitious programme" to correct the island's fiscal imbalances and lift sustainable growth.

"The agreement reached with the authorities is subject to approval of the IMF's Executive Board and is contingent upon the timely completion of prior actions to be taken by the Grenadian authorities and obtaining the necessary financing assurances," said Aliona Cebotari, IMF mission chief to Grenada.

As a result of the IMF agreement, the government has said it would also be able to secure US$100 million in soft loans and grant funding from regional and international lending agencies.

Mitchell told the award ceremony for local hotelier, Sir Royston Hopkins, that his administration expects "to see a significant turnaround in the economic climate within the time frame instituted for the (IMF) programme.

"As this happens and our economy is on the rise, the resources that we will start receiving shortly will be channeled into cultivating an atmosphere for local investment; for the propagation of smal- and medium-sized businesses; in providing sectoral support that will create jobs for our citizens; and in helping to salvage some of the present staggering enterprises."

But he said in the meantime, with the limited resources " we are promoting skills training opportunities for many of our young people, to prepare them for the opportunities that are to come.

"It has been said that success is what happens when preparation meets opportunity. We are therefore preparing our people and our country for the opportunities that will lead to our country's economic success."

Mitchell said that while there can be no accurate prediction "what our fiscal outlook will be in three years, we are optimistic that it will be much better than what we are currently facing.

"While we cannot commit to the removal of all the present sacrifices after the three years, we are certain that we will revisit and make adjustments that will ease the burden on many of our citizens who are labouring under the weight of the many challenges we now face."

"... we expect that we will emerge out of the darkness, and when we do so, the successes of Sir Royston and others will be the beacons that we look to in order to inform our direction in various sectors of our country."

He said that in the last year, Grenada has attracted a number of investors, and there are currently several hotel projects in the pipeline by foreign investors who have fallen in love with the island, and have seen the tremendous prospects in that industry.

"But even while we look to foreign investors for their business, Government is committed to fostering a climate that spurs the proliferation of new and existing ventures," Mitchell said.

"Therefore, I say to all the other hoteliers and aspiring business people, there is every reason to be hopeful. There is every reason to expect returns on your investment," he said, adding, "Sir Royston understood that, and as such, even in light of the present economic limitations on a national level, he has stepped up his game.

"More remarkably, he did not look to government because he knows that the resources are scarce and the needs are many. He embarked on his own path, and it is yielding dividends."

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