(Excerpts of Dr. Friday’s address at 41st Convention – Pt. 2)
National Development Bank
One of the most serious obstacles to development in St. Vincent and the Grenadines is the lack or scarcity of credit. The commercial banks see most business ventures as too risky and more often than not say “No” to their loan applications.
Financing is the lubricant that makes an economy move and credit is the most accessible form of financing. But, tell that to a farmer or fisherman, or small manufacturer or Agri-processor in St. Vincent and the Grenadines, who has been turned away repeatedly by the commercial banks. They need a hand up.
We will create a specialised bank, a National Development Bank, to eliminate the credit problem and make financing more accessible and more affordable for local businesspeople, especially small businesses.
The main objective of the Bank would be to promote economic development by fostering investment and business development in St. Vincent and the Grenadines. Since the aim of this Bank is not profit for shareholders, but to serve the national interest by promoting economic activity and business development, it will be able to provide cheaper loans to businesses. It will also provide financial and technical assistance in the areas of Agriculture, Fisheries, Tourism, Industry, Housing, Small Business Development and Human Resource Development.
Other CARICOM countries have Development Banks. These include: Grenada, St. Lucia, Antigua and Barbuda, St. Kitts and Nevis, Jamaica, and Trinidad and Tobago. The St. Vincent and the Grenadines Development Bank will contribute immensely to the economic development of the country. Funding for our Development Bank will come from a number of sources including the CBI programme which we intent to introduce in St. Vincent and the Grenadines. This will keep the cost of borrowing down.
Other objectives of St. Vincent and the Grenadines’ Development Bank will be to: promote and develop Small and Medium sized Enterprises; assist with the development of Agriculture and rural development; further develop the Fisheries sector; promote growth and diversification of the Tourism sector; finance student loans and develop new areas of the economy such as ICT.
Persons involved in the following areas will benefit. Small and Medium sized Enterprises; by provide funding to start business, training and assist with the business pre-start, start-up and development. Fisheries; providing funding to purchase engines, bigger boats, for example to get into tuna fishing. Agriculture; funding for farmers to assist with inputs, production, marketing, and to purchase vehicles and other tools. Tourism; funding to purchase taxi vehicles, water taxis, to develop hotels, restaurants, tour operations, and to develop and promote services like dive shops and boat charters. It will also finance students’ loans at a lower interest rate with flexible security and repayment schedules.
Relieve the Heavy Tax Burden
Vincentians are being taxed more and more every year. As the government’s debt increases, so too will taxes. The VAT, by various means, was increased three years in a row following 2015 elections. We have the highest taxes and the lowest wages in the OECS! No wonder we feel so poor. We don’t have to be poor; it is Ralph Gonsalves and the ULP who are making the country poor.
I believe we can do better. And will do better. To relieve the tax burden of people and free up money in the hands of consumers, we will reduce the VAT from 16 percent to 13 percent. Taxi and bus operators, we know you are struggling with high cost of vehicles and spare parts. We hear you and will help you. The local contractors also are feeling the pressure of living under this government, especially as government often behave like a bandit and fails to pay contractor on time or at all for their work. We will assist by reducing the duties and taxes associated with purchasing heavy equipment and other tool needed to do your work. We want you to be efficient and productive so you can serve the nation well and compete successfully for work in the other OECS countries.
To put it bluntly, VINLEC is killing us. Everybody knows the story: VINLEC is quick to increase the fuel surcharge with the slightest provocation, increase in oil prices, but slow to lower it when oil prices go down. To the consumer, it is just as painful to pay his light bill if the increase comes for rising fuel surcharge as from using more energy in his daily activities.
The light bill is too high. And we will do something about it, starting with ensuring that the fuel surcharge never exceeds the cost of units used. In other words, you should not have to pay more in fuel surcharge that you pay for the energy you actually use. Controlling the energy bill is important for the living standard of all households and critical to the competitiveness of businesses. Hotels, for example have to air condition their rooms. Imagine the bills they see each month, especially when the fuel surcharge jumps. In short, let’s get our people working, and let get the SVG economy moving so that we can create jobs for our people.
I believe in the capability and strength of our people. We cannot build a nation without engaging our people directly and completely in the process. Government cannot do it alone. Development must be essentially by the people and primarily for the people. I believe that is where we must begin. And so, that is where the NDP begins.
This is why I believe so passionately that we must give our people a hand up, not just a hand-out. The initiatives of a visionary and activist National Development Bank will give people the opportunity to lift themselves up and, collectively, lift up the nation. What could be more beautiful and rewarding than that? A people shaping out own destiny as best we can. I have said before and it bears repeating now: we can do great things when we work together, not only with one another but for one another.