Some 75% of cruise lines have indicated that they are suspending cruises for the balance of the season as a result of the coronavirus — COVID-19, Prime Minister Ralph Gonsalves said on Saturday.
“That’s hardship. We have to bear in mind we have 2,000-2,500 Vincentians working on those ships. Are they coming home right now?” he said in his National Heroes’ Day address at the Obelisk on Dorsetshire Hill.
“That’s an issue which has to be monitored from a health standpoint and also that has certain economic consequences for the families involved and for the economy, as a whole, because your earnings for this season have been cut short. And all the local support services for the cruise ships,” he said.
He made the announcement as he spoke about the economic impact of the virus.
“There’s no doubt that the economies in the world, the region and St. Vincent the Grenadines, the economies, have been adversely affected,” Gonsalves said.
This was to be expected. We should all hope that politicians begin to use their brains for the first time instead of thinking of “looking good” Most of what our PM has done is the right thing to do regardless of those that feel it is their responsibility to criticize absolutely everything he does. His 50% off the departure tax must have been a joke. It makes me think of the US Federal Reserve dropping interest rates to zero. These government measures will do nothing. Dropping interest rates to zero will actually hurt those that have saved money and hurt the US Economy. It is not difficult for us to imagine some of what lies ahead of us but we can expect inflation. The SVG Government and all governments will be forced to implement austerity measures hopefully only on the (unneeded) service end. Let me explain:
There are two sides of government implemented austerity: 1) Cutting costs, such as jobs and services. 2) Raising fees and taxes.
Thus far since I have lived in SVG the government has increased government jobs and services but raised taxes which is the worst thing to do when our private sector is in decline. It only accelerates the decline. We all see what has been happening in SVG for the last few decades. It is not rocket science! The Customs Department is far bigger than before, and taxes are astronomical!
If there is not a contraction in the “public” service and many other measures we will continue to spend beyond our means
“A country that spends beyond its’ means is destined to live beneath its means”.
Measures have to instead be taken to increase Private Sector jobs. In 2008 the SVG Government did exactly the wrong thing by raising taxes and cutting concessions (the concessionary system is already terrible and unfair) and caused our economy to further decline. It sacrificed the mid- and long-term gains for short-term crumbs. When the (hopeful) recovery starts after the worst of this virus, SVG must have new measures that encourage growth such as a competitive Corporate Tax below 21%, Streamlining the Customs Procedures and a 70% reduction of MOST duties, infrastructure renewal to increase efficiency rather than hinder it (what we have now with our bad roads and traffic situation. Rush-hour traffic situations is an all-day thing in Kingstown now).
Making SVG attractive for investment is essential. An additional benefit would eventually get most of the vendors off the streets (there would be better jobs available) when we could actually walk on the few sidewalks we have and maybe build more sidewalks so cars, trucks and pedestrians would not have to compete in front of Greaves, Massey’s Viera’s and other areas.
At present most of SVG is a total mess in many ways. This is a time for creative thinking. SORRY TO SAY THIS BUT…As they say:…
“Don’t let a good crisis go to waste.” ” When the going gets tough…”
I just hope the government re-prioritizes and does not put this crisis on the backs of the people, as usual, by raising taxes.
In the UK businesses are urging for more cash expenditure. “Chancellor Rishi Sunak is warned he must pump HUNDREDS OF BILLIONS of pounds into aid for stricken businesses to avoid MILLIONS losing their jobs amid coronavirus crisis”.
“French President Emmanuel Macron last night declared ‘war’ on the coronavirus impact, announcing a £300 billion fund (in euros) and guaranteeing that no business in the country will go under as a result of the crisis”. And “In the US, some politicians have been advocating so-called ‘helicopter money’ – cash handouts to the public to help keep the economy moving”.
https://www.dailymail.co.uk/news/article-8120341/Rishi-Sunak-unveils-massive-package-stop-UK-going-bust-amid-coronavirus.html
However, when you are a half bankrupted little country like SVG, ruled over by an extended family lead by a gaga old man who thinks that he is not only Joseph Stalin, Fidel Castro and Mao Zedong all rolled into one, there will indeed be nothing in the finance pot to put out there, unless that is, an election is called. Then the earth will be promised though could never be delivered.