I want to thank you for your positive response to the invitation of Government to participate in this dialogue. Since we are only in the second week of a New Year, I extend to you sincere best wishes for a successful and satisfying 2010.
I also want to take this opportunity to extend congratulations to the firm of H.H.V. Whitchurch and Co. Ltd on their 100th anniversary of delivering valuable business services to the people of the Commonwealth of Dominica.
It is indeed a pleasure to be here this morning to continue our engagement and dialogue. In the preceding term, the input of the private sector in national policy making was most beneficial and it is the commitment of this Government that we will seek to continue this engagement.
Needless to say, my Government is proud of the achievements of its last term. But I am also constantly reminded that the reward for work well done is more work. And so here we are again, seeking your input on matters of importance to the people of Dominica.
Ladies and Gentlemen, this Government remains concerned about the global economic crisis and the impact on the countries of the region and on our own economy. Even as we see some light in some of the developed countries, there is a view that it is not significant enough to bring any meaningful improvement to the economic conditions of the world in the short term. For example, in the United States, the fact that unemployment continues to rise, albeit at a slower rate, will certainly have a negative impact on our tourism industry and remittances. Many authoritative sources have warned that the major global economies, China excepted, are not likely to show significant signs of recovery before the last quarter of 2010.
There is also concern that the full impact of the crisis may not yet have been felt in the region and even while the developed countries begin to see some positive changes, there may be more economic decline in the region before things get better. It means that while we have been spared the worst effects of the global recession to date, the truth is that we are not yet out of the woods.
But we are hopeful. We ran a campaign of hope and we believe that if we can make a collective effort we will be able to weather the storms. We expect to review the performance of the various economic sectors shortly and hopefully, the results of that analysis will be a positive one.
We note for example, the statement by the representative of DOMLEC, that performance of the company was better in 2009 because of the increased economic activity in the country. We are concerned though, that the output of some of our sectors is not commensurate with the level of investments that we are making. I speak in particular of the agriculture sector, and more specifically the banana subsector, which, notwithstanding growth in the early part of 2009, seems to be declining.
Ladies and Gentlemen, one thing is sure; that we must continue to exercise vigilance and fiscal prudence if we are to continue to ride out these challenging times. Government has continued to implement the capital programme in a manner that will increase economic activity. We are, however, challenged by the late disbursement of funds from our key development partners and we are hoping that these matters can be resolved as quickly as possible.
This leads me to underscore the importance of the private sector investment. Much of the investment driving economic growth in recent years has been (direct and indirect) governments investment through the capital programme.
You would recall that after hurricane Dean, there was significant investment in agriculture by the Government. After hurricane Omar, there was also significant investment in fisheries and sea defences.
We need now for the private sector to take off from where the government has now reached. As Government, we will continue to improve the enabling environment to make it more economical and efficient for you to do so. I speak of the work at the Registry and Customs, enhancement of the judiciary (a second judge has been appointed), the strengthening of the legal drafting capacity in order to accelerate the drafting of new legislation and the ongoing work on land tenure arrangements. I speak also of our tax reform, electricity reform and the improvement to physical infrastructure – roads, bridges and ports.
Government is also facilitating the AID Bank in accessing substantial new lines of credit. We expect that this will act as a stimulus to investments in the productive sectors, and it is our hope that the private sector will take maximum advantage of the facilities that will become available.
There is one matter however, which I hope we can discuss today. That matter is the issue of the cost of living. In our consultation with the population we have found that the main concern of Dominicans is the cost of living and the challenge of citizens to make ends meet and maintain minimum living standards. You will agree with me, that Government played its part in seeking to reduce or manage the increases in cost of living that have occurred in the last few years:
1. We removed the excise tax on fuel used by DOMLEC by 50%, thus reducing electricity bills by 6% and negotiated with DOMLEC for a reduction of 2 cents per kilowatt hour on electricity bills.
2. With the assistance of the Government of Cuba, we provided energy saving light bulbs.
3. We exempted the payment of VAT on the first 100 units of electricity consumed.
4. On tax reform we increased the tax free allowance threshold to $20,000 and reduced the rates in the various tax bands to 15%, 25% and 35%.
5. Presently, all approved pension incomes are exempt from the payment of income tax.
6. We have also brought relief to taxi operators by exempting the payment of import duty on new and under five years old vehicles, used in tourism transportation and removed import duty on a number of basic food items.
Our social protection policy, has sought to bring relief to families by relieving them of the day to day expenditures. This includes the introduction of the schools transfer grant of $500, acquiring school buses or contracting with bus owners to transport children to and from school in the rural areas, providing grants to all Day Care and Early Childhood Centres so that parents are not called on to meet the full operating costs of the Centres and providing daily care for 248 elderly persons throughout the country while employing 43 caregivers to do so.
As a result of the concerns of the people, I announced in December a number of measures to be implemented within the first 100 days of the new government being in office.
These include the following:
• Regarding public officers, regularisation of the minimum pay, so that all full time employees receive no less than $1000 per month and for a further review of the minimum wage.
• Regularisation of positions in the public service including:
1. The creation of 100 new positions for nurses;
2. Creation of 150 positions for teachers so as to continue with our program of the appointment of temporary teachers at all our primary and secondary schools who have been in the service for a minimum of 2 years;
3. Creation of 50 new graduate teacher positions at both the primary and secondary schools and in the process removing the disparity in pay between primary and secondary school teachers;
4. Completion of the audit on non established workers and appointment of a committee to advise on implementation of the recommendations.
• Establishment of an Employment Agency to:
1. Help persons find employment;
2. Provide an allowance to persons who for more than three months have been unable to find a job. This allowance will be paid for a period of up to six months; and
3. Guide jobseekers in acquiring skills demanded by the job market through the various skills training programmes.
We also advised of the following:
• Reduction in port charges by 20 per cent;
• Increase in the number of days goods can remain on the port without incurring port charges, from five to seven days;
• Removal of customs duties and port charges on gifts, including barrels, valued up to $150 and
• A review of the list of VAT zero rated items.
Basically, we are trying to address the matter of cost of living from the wages/salaries stand point and from the stand point of the cost of goods.
We hope to hear from you during these discussions how you can contribute to the programme to reduce the cost of living for the people of Dominica.
As a means of assisting our firms to become globally competitive we may have to adopt some measures that will help local production firms without contradicting our commitments to regional trade agreements.
We look for your support when we develop an apprenticeship programme which will allow small firms, particularly furniture manufacturers and metal workers, to recruit a certain number of apprentices who will be paid a stipend by Government.
Within a fortnight, we will be meeting with the representatives of the labour movement. We believe that an engagement with them at this time is invaluable in securing lasting benefits to our efforts at reducing the cost of living.
I look forward to our discussions and first to hear from you on issues relating to the cost of living and of course on other matters that will assist in achieving our objective of improving the lives of the people of Dominica and in enhancing the effectiveness of your enterprises.
Thank You
This might look good to the untrained eye, but if you notice, the left hand was showing you a “reduction in the cost of living” but the right hand was knocking you out with the GROWING GOVERNMENT, and LARGER GOVERNMENT ROLE. Now tell me, which is worst, what you hear and see or what you feel?
This is simply a way for the government to distract the people. Almost instantly your first reaction will be to blame the private sector, the businesses for the increasing cost of living. What you don’t see is the rising cost of doing business in Dominica which automatically translates to higher prices to the consumer, lower wages to the worker, and higher cost of living overall.
Wake up, People!
Mr prime minister i think it is time we start looking at charging the many bars and rum shops and other ‘ shops’ a quarterly tax . I think just paying a liquor licences is not enough. Another suggestion is the question of property taxes. After all we want street lights and other services . we have to meet some of the cost .Finally we must start looking at licencing the various trades e.g painters, electricians , building contractors etc.