Tuesday and Wednesday (March 12-13) was Anguilla’s Annual Review of the Medium Term Economic Strategy for 2010-2014. The review showed that the situation in the island is grim at present. According to Dr. Aidan Harrigan, Permanent Secretary in the Ministry of Finance, Anguillians are fearful about the future.
The review, presented by technocrats in the Ministry of Finance and Economic Development, was attended by representatives from the European Union, Caribbean Development Bank, Eastern Caribbean Central Bank, the United Nations Development Programme and the International Money Fund. The UK Government was represented by Governor Alistair Harrison.
Dr. Aidan Harrigan welcomed the participants to the Third Annual Review of the Anguilla Government’s Medium Term Economic Strategy. He noted that the island was now experiencing its most severe period since it became a tourism-driven economy at the beginning of the 1980s.
“Preliminary figures suggest that economic activity, as measured by Gross Domestic Product in 2012, declined for a fifth consecutive year. That is, it has declined every year since 2008,” Dr. Harrigan said. “This decline measured around 17% in 2009. Some success was made in arresting the rate of the decline in 2010 and 2011.
“However, the preliminary figures suggest that the rate of the decline increased in 2012 relative to 2011 when the rate had slowed to about 1.8 per cent. This, therefore, would represent a setback. These are worrying times, for us, Anguillians as what is in effect an economic depression, manifesting itself in the form of high unemployment and all its attendant ills – examples: business failures, home foreclosures, hunger and so on. Anguillians therefore are naturally fearful for the future.”
Governor Harrison said it was his last attendance at the annual economic review in that he would be leaving Anguilla later in the year. He described the review “as one of the most valuable things that we do in Anguilla, bringing in all the stakeholders – external and internal – and have a very thorough look at the economic strategy and the way forward.”
Mr. Harrison said the international context of the economy was rather gloomy and not much better than when Anguilla did its previous review.He spoke about the UK having lost its coveted triple A rating which led to austerity measures and the unemployment of one million people under the age of 20, thereby indicating Britain’s inability to assist its Overseas Territories.
The Governor was of the view that in order for Anguilla to get back where it was before the downturn in 2008, there was need for a 7% growth in the tourist industry over the next five to ten years. He was afraid that the downturn would last for the rest of this decade and possibly into the next decade. “We therefore have to adjust, as all other countries, to the reality that what we see now, is more or less what we are going to see in the foreseeable future,” he added.
Chief Minister and Minister of Finance, Hubert Hughes, was noticeably calm and well-focused in his scripted presentation. He indicated that the reason for the review was to ensure that at the end of a given period the Government’s goals and objectives were achieved. “A more appropriate approach is to set intermediate milestones and targets which currently examine at pre-determined intervals so that progress can be checked and necessary adjustments made,” he continued.
“Here we are now reporting on the progress of the Anguilla Medium Term Economic Strategy for the period 2010-2014 for the time. This is significant because it indicates the willingness and determination of all involved to make sure that the process is continually evaluated so that the desired results are not left to chance.”
The Chief Minister was grateful for the plethora of ideas that was being put to the task of formulating the annual review and strategy. “I will go on record and say that the harmonisation of ideas and approaches are a critical factor as we tackle the developmental issues facing our island,” he went on. “I applaud the vision of my Ministry for ensuring that our development partners – such as the United Kingdom Government, the ECCB, CDB, UNDP, IMF and EU – are represented here…I am very pleased to see that despite the real purpose of this review, was to serve a more limited audience, its scope has expanded in a way that Anguilla can benefit from a harmonised approach to its development.”
Mr. Hughes said that a problem with the island’s development was the need for a proper airport to service the island’s tourist industry. He hoped that Anguilla’s international partners would assist in meeting some of the development needs of the island. He said that because the UK had lost its financing rating, Anguilla could not rely on Britain exclusively as a traditional donor. “We must look for innovative means of developing our economy and preventing Anguilla from slipping into abject poverty,” he added.
Head of the European Union delegation, Mikael Barfod, was pleased to be in Anguilla for the first time. He said the EU had a longstanding history of cooperation with Anguilla. “It has been providing assistance since 1976 through no less than seven European Development Fund cycles,” he recalled. “Since 2005 when the UK Government stopped providing direct budgetary aid, the EU is Anguilla’s only source of grant-aid and the main stakeholder in its development and reform agenda. Through this partnership, EU resources have been provided in the areas of economic infrastructure for water, roads, seaports, airport, energy and tourism.”
He spoke about the recent 9th European development programme which amounted to 12.4 million Euros for infrastructural, technical and managerial improvements to the air transport sector and the establishment of the Port Authority; the 10th development programme which provided budgetary support of 3.6 million Euros in July 2012; and the next disbursement of funds in 2013 for procurement reform, property tax reform; education, training and the maintenance of catastrophic risk management insurance.
Mr. Barfod commended the Government of Anguilla for handling its fiscal problems and balancing the budget. He looked forward to receiving information about other economic and financial matters affecting the island.
The first three presentations by technocrats in the Ministry of Finance and Economic Development were the Medium Term Economic Strategy 2010-2014 and EDF 10 Update by Project Officer, Shantelle Richardson; Review of Anguilla’s Economic and Fiscal Targets, Management and Performance by Nashara Webster; and Tax Reform by Comptroller of Inland Revenue, Gecheal Richardson.
Various other technocrats in all the Ministries gave presentations over the two days of the review.
