As the world contemplates the issue of a global recession that could have deep and lasting impacts on how we survive – even within the Caribbean region – it is imperative that we in Anguilla become very proactive. By that, we should be considering how we can take measures to cut the overall cost of running our country – Anguilla.
It seems as though government after government has ignored the need to engage in austerity measures to reduce public expenditure and creatively expand the economy. Instead, they take the easy way out and allow the ‘status quo’ to continue.
As each successive government finds it more and more challenging to manage the cost associated with running the country, the government of the day appears to seek comfort in the ‘status quo’ approach – generating new revenue through taxation.
Notably, there are significant problems that naturally lend themselves to this approach: it increases the cost of living for the people and residents of Anguilla; it makes Anguilla seem unattractive to visitors in terms of the cost to visit; and it discourages people from wanting to do business in Anguilla – all of which have a negative economic impact on the island.
In effect, the ‘status quo’ of revenue-generation primarily through taxation displaces some of our people, especially our young people who find it more and more unbearable to live in Anguilla. In order to survive or have a decent standard of living for themselves, their families and future families, they ‘throw their hands up in the air’ and migrate to the UK or to the US. When they migrate to other lands, we in Anguilla lose generations of working-class people who are not contributing to the social security scheme in Anguilla or to the economy and overall development of this country. When that happens, the country dies – its youth move away with no real prospects of ever returning home to live.
Looking at this problem wholistically, it is important that we create and actively seek out economic opportunities that attract our young people who have migrated out of Anguilla to return home, and that we retain our youth in this country within the workforce.
Whereas, the population in most of the region has grown substantially over the years, the population in Anguilla has grown very little. There was a time when Anguilla’s population outnumbered that of the BVI, of St Maarten, and of the Turks and Caicos Islands. Instead of growing, Anguilla today is experiencing an exodus of human capital, especially among our young people who are leaving Anguilla in search of better living opportunities elsewhere.
The ‘status quo’ of revenue-generation primarily through taxation makes Anguilla less attractive as a destination choice for visitors on limited budgets. Anguilla will probably always be a niche destination for high-end vacationers who tend to purchase all-inclusive vacation packages resulting in major spending profits going off island to the hotel property owners and investors.
The ‘status quo’ of revenue-generation primarily through taxation also forces would-be investors to not come to Anguilla to do business, but instead, to choose other jurisdictions that are just as appealing as Anguilla, but where the labour is cheaper, the water is cheaper and the electricity is cheaper. While Anguilla has ‘a very pretty expensive offering’ – sun, sea, and sand – it would still be ignored for other places with ‘many very pretty affordable offerings’ – sun, sea, sand, good-paying jobs, readily available goods, easy access to essential services, and affordable living, etc.
So, when we talk about austerity and finding creative ways of cutting cost in Anguilla, it is imperative that we act on it, because to not do so is having all kinds of negative impacts on our country – impacts on the population, on inward and foreign investment, on people’s quality of life and on the overall cost of living.
There have been so many missed opportunities for the governments of Anguilla to abandon the ‘status quo’ draconian mentality of entitlement, turn Anguilla around and steady her on an upward and forward trajectory.
There have been opportunities to move some of the public service workforce into the private sector workforce. There have been opportunities to address issues of redundancy, efficiency and productivity within the public service and government statutory bodies. There have been opportunities for government to reduce the size of its ground transportation fleets and cut back on its electricity and telephone usage – especially during off-peak hours.
Post Hurricane Irma Anguilla received large amounts of money from the UK Government in relief assistance and, with it, the government of the day moved with great haste to construct a number of needed buildings across the island. However, the extravagant size of those buildings comes with an increased consumption of everything needed to keep them operating. This too, adds to the cost of running the country putting more burden on a declining population.
Unless past governments, this government, and future governments, lose ‘the status quo’ and realise the need to streamline the cost of running Anguilla, it is unlikely that the cost of living in Anguilla will improve significantly. It is unlikely that the economy of Anguilla will realise much growth. It is unlikely that we will be able to attract many people to stay in Anguilla and keep its operations going year-round. It is unlikely that investors will consider Anguilla to be an appealing destination in which to invest.
The recent introduction of the Goods and Services Tax (GST) in addition to the Interim Stabilisation Tax, and all these knock-on effects, have also added to the cost of living and doing business in Anguilla. As a result, the residents, local businesses, local and foreign investors, as well as potential investors, are all suffering. The ‘status quo’ of entitlement and revenue-generation through taxation is taking Anguilla nowhere – quickly!
