Economy to worsen, people are hurting-Hon. Fraser
![Premier Dr The Hon. D. Orlando Smith said he still thinks that our economy is robust. He noted that while there have been some layoffs, that is something that happens in [other sectors] and businesses have to adjust their practices according to demand. Photo: VINO/File](https://www.virginislandsnewsonline.com/cache/images/800x_p_Premier_Smith_11_01.jpg)
In a release issued today, November 8, 2013, Hon. Fraser noted that beginning in 2007 just prior to the start of the Virgin Islands Party Administration and ending at about the middle of the fourth quarter 2013, that is exactly at the midterm of this current Administration, the territory was fortunate to be the beneficiary of substantial investment capital, most of which was for direct or associated government projects.
He argued that public spending had without question served to build private sector confidence and consequently fuelled reasonable private investments which have ran their course within this same period.
“Unfortunately, this phenomenon will not be repeated soon, if ever, thanks to the Protocols for Effective Financial Management which places us in an estranged relationship with borrowing of money, and even making partnership investments,” the former Minister for Communications and Works said.
He contended that, despite the recession which started in 2008 that persisted globally except in the United States to some extent, the Virgin Islands was fortunate to have had in circulation a $50 million loan for the construction of Peebles Hospital from 2007, buttressed by a subsequent $45 million which has just ran out.
That capital infusion, he added, saw another $23 million of confiscated IPOC money added, of which $10 million went directly into the same Hospital Construction. Other investments such as the $3.8 million spent on the Commercial Court building, and the $6 million Deutsche Bank loan funds spent on the Greenhouses must also be acknowledged.
Additionally, Hon Fraser said, the investment which resulted from a water production agreement between the government and a private company amounted to a further $25 million capital injection into the economy.
He felt that this $153 million which went directly into our economy over that six year period has served to make the difference between a Virgin Islands that fared rather well, and a Virgin Islands in recession.
According to the Third District Representative, “that is now coming to an end, unless our Premier does what I have advocated for the last 18 months, which is to inject capital into the economy.”
Despite all of this however, Premier Dr The Hon. D. Orlando Smith said, “I would still think that our economy is robust. Of course there have been some layoffs but I think that is something that happens in [other sectors] and businesses have to adjust their practices according to demand.”
“It is untenable for the Government of the Virgin Islands to owe vendors (common citizens) $12 million but yet have $24.9 million in a savings account. What is happening to these people is that they are unable to replenish inventory, pay their rent, pay staff, and are literally left to go out of business,” Hon. Fraser remarked.
At the First sitting of the Third Session of the Second House of Assembly on October 7, 2013, Hon. Fraser said, it was revealed that our government treasury was sitting on $12.1 million of unpaid vouchers with only $3.45 million in their checking account, obviously unable to pay its bills. But yet through some ill-advised policy, the same Government which cannot pay its citizens for services rendered, is sitting on a $24.9 million reserve with the hope of growing it to $64 million so that they may stand a chance to borrow once again.
This situation he added, reminds him of Hamlet's, "While the grass grows, the horse starves".
According to Hon. Fraser, “Our people are hurting, but people in authority don't seem to understand why, despite the obvious occurrences of jobs loss, company closures, and downsizing, they continue to take money out of citizens’ pockets which reduces their liquidity and further hurts the economy.”
He further argued that, at the exact time when the Government is supposed to make it possible for consumers to have more money to inject into the economy, government has decided to raise taxes on passengers traveling by boat to the US Virgin Islands, and what is terrible about this is that the money isn't even going to central government where they can pay some of the vendors they owe, so it can get back into the economy.
“I am genuinely afraid for where the territory is heading,” Hon Fraser stated, “given that since the general elections of November 2011 I have been observing a frightening trend of company closures, company downsizing, job redundancies, employee layoffs, and bank foreclosures that are unprecedented.”
The Third District Representative cited the pull out of American Eagle, which he said on its best days flew upwards of 12 flights a day with as many as 768 passengers, as having done irreparable damage to our economy.
He further noted, TMF's acquisition of Commonwealth and Equity Trust has resulted in the layoff of 15 employees; the closure of Columbian Emeralds, and A. H. Riise: two major multinational jewellers no tourism destination like ours could afford to lose; Long Bay Hotel has been reduced from an all year 100 unit hotel to a 42 unit seasonal hotel; LIME’s layoff of some top executives and is now about to layoff 30 technicians; First Bank served notice of employee cutbacks; First Caribbean Bank served notice of staff reduction; Pussers closed a popular restaurant with several employees; CCT’s layoff of 16 employees; Moorings’ layoff of 16 employees including top managers; all these things happening with no government intervention.
Premier Smith has argued, however, that the frequency of layoffs in the Territory does not reflect the state of the economy.
Questioned at a press briefing on October 18, 2013, about whether government was worried by the frequency of layoffs, Dr Smith replied, “The frequency of layoffs, depends on numbers, does not necessarily reflect the state of the economy. The state of the economy is determined by all the work that goes on in the Territory.”
“And as if all this wasn't enough bad news,” Hon. Fraser added, “on August 21, 2013 France has added us to its list of uncooperative Tax Havens, paving the way for tougher financial levies as the EU's No. 2 economy tries to crack down on tax evasion. What is particularly troubling about this development, is that the Premier tends to be somewhat nonchalant about it as he cites a comment made by David Cameron.”
He suggested, “In the face of all these setbacks, our Premier needs to sit with business leaders to find out where government can play a role in keeping people employed. There are incentives that governments usually give to businesses in times like these. He needs to eliminate certain government fees which would make it easier on mothers with children.”
According to Hon. Fraser, a major overhaul of the Development Planning Unit is a must.
He continued, “Until our leader has ready access to reliably accurate statistics nothing substantial can be expected. But naturally, the Premier must first acknowledge this as a major cause for his handicap.”
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30 Responses to “Economy to worsen, people are hurting-Hon. Fraser”
Fraser hush You set this up when you was in there 2 years ago.
Scatter your rass $%%£ MW you are the one we are tired of and you need to hush and take a hike back to Antigua tall lady; Tired of u Now
For over 20 years it has been getting worse and Fraser was in there too. He needs to remind the people it was VIP that started all this mess and then when NDP got in, they expected them to clean up their mess, trying to make the people think this was new mess. They should be made to step down, all of these old Baggers. Sick of all of them and it turns my stomach hearing these speeches. They never get up and state they were wrong, but can we now do it right for now on..they just keep on with the same lies over and over talking to the public like we are stupid.
I do not know who to blame, but if everyone is blaming the NDP i could do it too. Last weekend we had a lot of rain and some parts of my house got wet. Why did the ndp allow the rain to fall for so long. So much people got wet and some could not even leave home at times. We need help .Lets get another party started. What are we to do.BLAME BLAME BLAME> My fruit trees are empty . my car needs cleaning. I got paid and went out for the whole weekend and now my light cut, what is the NDP doing to help. Nothing.
I need to send a picture of our roads to the Queen......especially in front of Dr.Pickering house. Disheartening to natures little secret.