The economies of the Eastern Caribbean Currency Union (ECCU), to which Dominica is a member, continues to face significant headwinds and recovery has been listless, the International Monetary Fund (IMF) has said.
The IMF just conculuded its 2014 discussion on the common policies of member countries of the ECCU and the picture is not good.
“Limited fiscal space and excessive public debt, financial sector stress, and weak external competiveness continue to hold back economic recovery,” the organization said in its report. “Inflation is expected to remain subdued at 1.7 percent. Risks to this outlook are high, stemming in particular from stress in the region’s financial sector and member countries’ fiscal pressures.”
Althought the so-called world economic recession eneded in 2012, economic recovery in the region is expected to be below par.
“This year, the economy is expected to grow by 1.3 percent, up from 0.5 percent in 2013, but well below the pre-crisis average of 3.8 percent,” the IMF said.
It pointed to a need for addressing “vulnerabilities associated with unsustainable public debt, financial sector stress, and weak external competitiveness” in order to grow regional economies.
“Directors agreed that the region’s growth and resilience would benefit from deeper regional cooperation, particularly in the areas of tax policies, fiscal frameworks, infrastructure, and financial sector strategies, taking advantage of technical assistance from international institutions and other development partners,” the report pointed out.
It further stated there is a need for “for ambitious, credible medium term fiscal consolidation to put public debt on a sustainable path and create the fiscal space for counter cyclical policies in the context of the quasi currency board arrangement.”
“A strong fiscal framework at the regional level, supported by effective monitoring and enforcing mechanisms, would help underpin these consolidation efforts and promote durable fiscal discipline,” according to the report.
The IMF has recommened what it described as a “two prong approach” to reducing fiscal imbalances in the ECCU.
“On the expenditure side, they saw scope to reduce the wage bill and budget transfers to state owned enterprises, while better prioritizing public investment and consolidating government functions through broader regional collaboration,” the IMF report said. “On the revenue side, a coordinated regional strategy is needed to streamline tax incentives, reduce intra regional tax competition, and enhance transparency in tax systems. Directors underscored the need for prudent management of citizenship by investment programs, backed by strong due diligence and a transparent operational framework.”
Other recommendations by the IMF include a comprehensive regional strategy vital to strengthen financial stability and avoid contingent fiscal risks, swift implementation of bank restructuring and resolution strategies, seeking private sector solutions where feasible to minimize fiscal costs while continuing to preserve public confidence in the banking system.
It also called for further efforts to strengthen the supervision of financial institutions and to enhance the legal and regulatory framework in line with international best practices.
The IMF see a great need for reforms aim at improving productivity, cost efficiency, and the investment climate in order to boost growth.
“Strengthened collaboration among the governments would help ease the region’s capacity constraints and improve economies of scale,” the IMF said.
ECCU countries include Antigua and Barbuda, Dominica, Grenada, St. Kitts and Nevis, St. Lucia, St. Vincent and the Grenadines, and Anguilla and Montserrat.
ECCU countries include Antigua and Barbuda, Dominica, Grenada, St. Kitts and Nevis, St. Lucia, St. Vincent and the Grenadines, and Anguilla and Montserrat…
These are the countries that will remain dormant if they continue to policies and directives by organisations like the IMF, if they don’t come together as one and device a strategy to move forward. These countries need to liberate themselves from mental slavery, poverty and political
vulnerability..
How much money a place as Dominica generates and has? How much tax is collected from the employed and businesses? Approximately a year ago it was stated that some nationals, whoever they are, collectively owed an exorbitant sum of income tax. Has this been rectified, in that, have they honored their obligation to the State?
IMF cannot expect those countries to be more than what they are. Those countries are somewhat dependent on loans and grants. Consider all what is being done in D/ca regardless of how much the Chinese government is assisting, it takes money to complete and achieve projects.
Everyone concerned must be considerate and not be critical. An open and broad mind in this case should enable them to consider Dominica’s situation. Dominica is still better off today than in previous years. It is so obvious that some still do not see it and view it that way,
mr labad, I will quote you and may your soul rest in peace.
“TIME WILL TELL”
anyway, that not for Dominicans. we doing well, we just build our state palace to put severin and our villas and apartment doing fine. the cost of living not to high and de hotels and tourism sector doing very well. we exporting more local produce than every other island in the ECCU and we as a government can give the majority of Dominicans(labourite) money from de treasury every Wednesday… the civil servants and police don’t need or even complain for an increase in salary because they are satisfied and have a big surplus when they pay all their bills. we are even thinking of raising the vat to 20 percent because the people don’t mind it…
so Mr. IMF this is not for Dominicans, as a matter of fact we doing so good we are going to give other ECCU assistance from the big surplus that we have.
i am very positive that the plan team Dominica have for pushing the economy forward is good,i live in london i am just waiting to take advantage of the real housing revolution
team Dominica promise reduce taxes on building martial my GOD,that will put truck drivers working builders working, the complete society will-see the benefit.its been done in the past.please let us reduce the hand out, and go to work
I AM READY FOR CHANGE ARE YOU DOMINICAN IN LONDON.
We need Leaders that concentrate on wealth creation. Our present leaders believe they can beg their way to prosperity.
Change is happening, and change will continue till we get it right again.
The resources of the world is finite and this gives value to our needs; wealth can neither be created nor destroyed. In all instances of economic success wealth is redistributed or pooled and that is the magic of US consumerism. Wealth can be pooled in large and insatiable markets infatuated with the young and new. But our demographics will not fit the US model; so the private sector should seek ideas from abroad or partner with companies willing to expand to the region. There was a time when we were advised to identify a need then fill it; today, we must also create the need.
Wealth is created any time anyone does something useful that adds value to a product or provides a service that’s valuable to others. Even basic resources can be created, that’s what mining and farming are for.
Similarly, wealth is destroyed all the time, by waste, fraud, theft, wars, and so forth.
When we look around the world at small societies that have become wealthy, what do we see? Singapore, Hong Kong, Dubai, Bermuda, Liechtenstein, the Caymans. They all have something in common in that they all shrank the state to a bare minimum so it would get out of the way of economic prosperity. This isn’t a confusing or difficult process, and we surely don’t need those people at the IMF advising us on how to screw it up.
We need leaders who will concentrate on wealth creation. Our present leaders believe that they can beg their way to prosperity.
They know all about wealth creation….for themselves!
One thing UWP and their supporters have working for them is that they are real boldface. Some of them have the guts to talk about spin operatives but they are just telling boldface lies day after day. Only evidence holds up in a court of law.
IMF aren’t here to help anyone. All they do is create an environment of poverty so ‘the rich godfather’ can bail u out.
Slavery via debt.
The Red clinic will become more important to the poor who have really been suffering so the little god becomes a bigger one. The breast minister will offer more Thighs,breasts and legs not forgetting the beef.
More prostitution. Building materials ,jobs promises will be come bigger bate. Al the sexy girls will really work it by doing the workie.
The Holly truth of suffering.
Actions speaks louder than words. What you sow that is what you will reap. The PM beloved IMF has just shown him the fruits of his LABOUR.
CHANGE IS A MUST NOT AN OPTION.
Ah yes, times are hard. Yet, my suspicion is that by the next IMF forecast we would have some less bleak news because every OECS member country is already putting in place aggressive growth measures.
that is an idiotic statement
Did Dominica’s PM read this report? If I was him I would hide in shame but he doh have no pride and he doh care about Dominica so he will come back on the radio station and lie for those foolish labourites about Dominica doing so well and better than most countries how we have to send money overseas to our relatives. Lying is the only qualification I see the PM have.
Labour ka twavie lol
the poor economic vision of our current government is the prime culprit of our economic woes .our biggest economic growth took place in the eighties.
Long time workers singing that song. But Dominicans head Hard… who cannot hear will soon feel. It is clear to anyone who have eyes to see that Dominica is suffering UNNECESSARILY because of this administration and Dominicans potential. But alas… ‘none so blind as those who will not see.’ Until the fire on top of their house they wouldn’t see it
it i not like before when rich folks use to settle on these islands and invest. Today the developed world suspect all their citizens investing in these islands ,especially the USA. They arrest and take them back as crooks ,jail them etc. like Sanford for example. what do you expect IMF miracles.
Everytime Skerrit talks to his fools he blames the Global Financial Crise WHICH ENDED LONG AGO, and had very very very little megative effect upon Dominica, for the poor and miserable state of the country. This is clearly a man who wiill take Dominica to the clearners as its Minister of Finacne. He does not understand Economics, or the parlance of the subject. The ECCU had already stated that for the economies of the ECCU to remain strong and viable,, economic growth had to be between 3-5%. Can a team like the broken cabinet which is lead by Skerrit attain this? The answer is clearly NO.
Even if these DUNCE CATS are given what to do on a platter, their GREEDINESS and ineptness is such that they won’t be able to do it. THAT’S WHY CHANGE IS A MUST!
The begging syndrome which will be Skerrits most damning legacy has to stop. The impoverishment of the people has to stop. The insulting of the people has to stop.
Thank God We have economists on TEAM DOMINICA/UWP who understand Economics and knows what to do to propell the country forward.
Dr Thompson Fontaine (International Economist)
Joshua Francis
Joseph Isaac
Claudius Sanford. CAN YOU BELIEVE IT??????????? WOW! WOW! WOW!
Compare this to Skerrit who is the courrupt Labour Party chief Ecomomist and Minister of Finance…. Absurd, laughable, preposterous and SHAMEFUL!
HOW LONG?
NOT LONG!
After discussing this IMF report with my son Ron not so Green, I asked him whether Lennox Linton didn’t show them (IMF) his plans to improve/grow the economy by 7% each year?
He told me that he Lennox wasn’t there and no one in the party has a blue print for that and even if he had it they wouldn’t be able to interpret it. He told me that maybe Thomson would be able to say if he has one, and that he Thomson was afraid to take it to his former bosses because they would use it confirm why he isn’t working/employed with them any more.
So wen my son Ron told me so, i asked him why not show them the plan or even talk to them about your party’s plans, he said ” we just trying something, hoping the voters will believe us”
@Ma Doris/La Plaine Why didn’t you refer to yourself as a buffoon instead. It is sad that idiots like you are taking something directly affecting a poor economy like Dominica, with inept and incompetent government as a joke. Are you one of those depending on Red Clinic Funds? Well that is a bad sign, because even it might dry out soon.
Thanks God though, TEAM DOMINICA LED BY LENNOX LINTON WILL SOON TAKE OVER.
CHAMGE IS A MUST. NOT AN OPTION!
Ma Doris…..Just like this inept, corrupt LABOUR government you`re taking this report and forecast as a big joke. It is your son who will suffer under this bleak economy.
Ron Green, Edison James will move on and they will not be affected. Lennox has OECS and CARICOM work experience and how these ECONOMIES works, HE WILL SERVE AS OUR NEXT PRIME MINISTER.
iun the meantime YOU AND YOUR SON RON –ALL you there playing silly stupid hopscotch politics with our poor economy.
By the way you are right, RON is NOT Green, he is BLUE…..and TEAM DOMINICA….CHANGE IS A MUST…….AND THAT IS THE RED GREEN AND LEAD BY THE BLUE.
WE NEED CHANGE…WE NEED ECENT GOVERNMENT
Ma Doris you can laugh but I’m going to pull all my EC.$. out of the Crapaud bank and change it into U.S.$. before the devalue our E.C own because I’m afraid that can really happen and then nobody will be laughing, except those guys who have stached their money away in secret off-shore bank accounts already.
Ma Doris WOY! why dont you wait for November you can then enter short story contest with that garbage you just wrote; this is serious business that requires astute and mature discussion – at least Lennox outlined his plans – why didn’t the party in power outline theirs to the IMF – every serious meeting that has been called our leader the PM, finds a way to excuse himself. Well Now that he is Chairman of OECS lets see how many meetings he will Chair and I hope he will be honest with the rest of his colleagues by saying whatever the IMF says about the ECCU that does not refer to Dominica because we in Dominica are doing better than all of you.
I don’t believe you know what you a saying or understood what your son explained because Team Dominica UWP do not have to show their plans for the development of the Island so try to have your facts in order before posting being uneducated is your set back.
U well trained under Tony, propaganda at its best.
Stupesss i wanted to put a thumbs down!
That’s funny!!!!
Nice one Dorris – try again. Ignorant!
idiot, you should be discussing how skerrit get us in that hole we are in and what he going to do to fix it.
lennox not in power.
Wonder how the spin-operatives going to spin this one on the “Next Level” program? Though the article addresses the ECCU as a group, it is fair to say that Dominica has the lowest foreign investment according to the last report, has one of the highest taxes in the group, VAT on electricity rates like no other and the highest unemployment rate in the region.
Well you just put a spin on it. As usual lacking credibility.
There is need to audit and restructure the OECS Economic Unit. New ideas need to come from various stakeholder in the OECS in the areas of manufacturing and the provision of services. Perhaps a greater effort at joint marketing should be looked at. The competition among member states for”economic citizens” is hurting them all. Both product and service differentiation are required along with transparency which is lacking. Unless the governments can demonstrate competitive advantages in value the perception of product is going to diminish. Governments, for want of eternal political power engage in activities that are politically correct and not necessarily fiscally prudent. Custodians of a country’s resources must allow trained technicians to suggest and handle matters of economic management. All in all, there has always been desperate need for governments of the subregion to work collaboratively instead of unwisely competing against each other resulting in minute economic, social and overall long-term benefits.
This region have just been taken for a ride by the politicians and as you can see, primarily the LABOUR PARTIES. These guys are just simply wicked or do not know what to do to manage the economies of the region, they have systematically destroyed the future of the region by amassing significant debts without paying attention to production and foreign currency earnings knowing full well that we importing everything. These governments have jeopardized the future of the ECCU countries by this strategy. And due to their nepotism and bobol 20 to 30 percent of these cost do not add value as they go in people personal pockets. The IMF didn’t have to come tell the people of the region the state of the economies because we feel it every day.
The IMF could not be referring to Dominica. Luckily, Dominica and UWP Team Dominica under the leadership of Mr. Lennox Linton, Prime Minister in waiting, have the services of Dr. Thompson Fontaine. It is the same Dr. Fontaine the IMP had tremendous confidence in over the years. It is the same Dr. Fontaine that was responsible for cleaning up all the economic mess all over the world on behalf of the IMF, especially in Africa.
It is the same Dr. Fontaine who/whom:
1. A few years ago made the rounds on Kairi, political platforms, and in print to tell Dominicans that the DLP’s programme of economic recovery was the best thing for Dominica.
2. After serving for years in one or two regions in the world (NOT “all over the world”) CANNOT point to one single earth shattering achievement that warrants the attention of any respected economist or political leader. NOT one!
3. The IMF gladly allowed to leave.
4. Siphoned DAAS funds into his personal account and later claimed that it was an “error of judgment”.
5. Unscrupulously acquired lands from DAAS …….(fill the blanks)
Choose your Dr. Fontaine. Make your pick of the kind of Dr. Fontaine whom you wish to remember but Dominicans will remember all of the above.
Typical labor party supporters, they always accuse supporters of the UWP of bringing down other Dominicans, but they are the guilty ones. You see how Doctor Fontaine’s name is easily dragged through the mud. All we are saying, Dominicans should be proud because a son of the soil has worked with the IMF.
You managed to bring yourself to write this? The same Thomson Fontaine the IMF refused to renew his contract.
The same Thomson Fontaine with all the questionable activities in the DAAS concerning land and money. So much guts!!
Wow how amazing this report is . reform for change is a must.
First reform that killed Dominica was Austerity with the VAT, second was ALBA.
@Morihei ALBA was touted as the thing that would solve all our energy woes!
You can well understand why i do not believe anything that the Labour Party says. If the tell mne jump, i will run. LIARS!!!!!
On the contrary, even IMF records show that VAT and ALBA have helped to rescue Domincia.
Go take your pills. Enough with your lunatic rantings.
as I said, you are an educated idiot. call a spade a spade