Prime Minister and Finance Minister, Dr. Keith Mitchell on Wednesday delivered a $1.146 billion budget as he presented the Estimates of Revenue and Expenditure for the 2020 fiscal year at a Joint Sitting of the House of Representatives.
The budget was presented under the theme: “Towards Vision 2035: Empowering our communities, growing our Economy, protecting our environment strengthening our environment”.
According to PM Mitchell, this theme is in keeping with the “overarching focus of the government to commence the implementation of the National Sustainable development plan 2020-2035.”
He said the “priorities enshrined in the 2020 budget are framed within the context of Government’s Medium Term Agenda (MTA), which captures the essence of the National Sustainable Plan in three-year cycles.”
The Budget is summarised as follows: Recurrent Revenue $786.2m, Recurrent Expenditure $633.7m, Current Account Surplus $152.5m, Primary Surplus (after grants) $212.8m, Overall Surplus (after grants) $145.8m and Principal Repayments/Authorisation $287.0m.
Prime Minister Mitchell told legislators that “Preliminary data for the first half of 2019 indicates that the economy is poised to experience its seventh consecutive year of growth, estimated to be 3.2% in real terms.
“You would recall that when this Government took office in 2013, the unemployment rate was over 40%. Mr. Speaker, data collected for the first quarter of the 2019 Labour Force Survey, indicate that the unemployment rate fell to 15.2% (and) average inflation as measured by the Consumer Price Index remained subdued in 2019, estimated at 1%,” he said.
In terms of advancing health care in the country, the Prime Minister admitted that there are some weaknesses in the areas of stock management and control and the approach to patient-centered care and spoke of his government’s intention to enhance the system by “investing heavily in training health care providers to enable the delivery of the best service possible.”
This year, the Ministry of Agriculture is receiving an increased budgetary allocation of $1.9 m, moving from $16.7m in 2019 to $18.6m in 2020.
Major projects to impact the agriculture sector in 2020 include SAEP, which is a $38m project managed by the Rural Development Unit in the Ministry of Finance and the Agriculture Feeder roads project which is seeing increased investment in the amount of $100.62m bringing the total investment to $157.2m.
The allocation for Tourism has also increased by $6m from $21m in 2018 to $27.4 m in 2020, geared to facilitate airlift support and improvements to select tourism sites including the site that currently house Police headquarters at Fort Rupert.
Among several projects to come on stream in 2020 is the $16.1 m OECS Regional Health Project, which will be used to start the upgrades on five healthcare facilities including the Mt. Gay Psychiatric Hospital.
Prime Minister Mitchell also announced the implementation of a water supplyexpansion system and sewerage improvement project which is being financed by a $34.7m grant, which will be implemented by NAWASA and is expected to build resilience to the impact of Climate Change.
He also announced that government would receive a $38m grant from the Chinese government to refurbish the Kirani James Athletic and Football stadium at Queen’s Park.
The Prime Minister announced that his government will be returning to the BOLT system under which it had financed the first National stadium at Queen’s Park with assistance from the Republic of Taiwan in the 1995 to 2003 period.
He said: “Government is pursuing Build, Operate, Lease, Transfer (BOLT) arrangements for three major and long-awaited infrastructural projects – the Governor General’s residence, the Halls of Justice and the Police Headquarters. Plans for these are significantly advanced and Cabinet has already received presentations on all three projects.
“Mr. Speaker, Government would incur no upfront cost with these projects which are expected to commence in 2020. About 200 jobs will be created. The estimated value to the private entities is more than US $100 million.
Dr. Mitchell also announced plans by government to spend heavily in 2020 on refurbishing a number of government buildings.
He said that a major undertaking next year will be the refurbishment of Government-owned buildings to help minimise expenditure on rent and to generate additional revenue.
He disclosed that an Infrastructure Refurbishment Committee has been established and several buildings have already been identified for renovation in all parishes including the Ministerial Complex in Carriacou.
He said the estimated value of these projects is $10 million and it is expected to create over 150 jobs.
The Prime Minister read out a list of major Private Sector projects that are expected to help spur economic activities and growth in 2020.
He spoke of the state-run Grenada Investment Development Corporation (GIDC) giving approval to 21 of the 27 applications submitted for investment incentives.
“Collectively, these projects represent an investment of $2.3 billion in the local economy, creating more than 2,000 jobs”, he told parliament.
According to the Prime Minister, the approved projects are in the tourism, manufacturing and services sectors.
Dr. Mitchell highlighted several construction projects that have started in the south of the island to try and cash in on the growth of the St. George’s University (SGU) in the True Blue area.
He told Parliament: “There is continuing construction and many student accommodation facilities became operational in 2019, particularly in the True Blue area.
These include: • Hideaway True Blue – a total of EC $22 million was invested in this 44-bedroom condominium development, which created at least 70 construction jobs and now that operations have commenced, between 7 and 10 full-time jobs.
- Fifty (50) newly constructed single apartment units by Ace Holdings Ltd. (Honey Comb Apartment), have created permanent employment for 10 persons.
- Comfort Zone Ltd., located in True Blue, is a EC$4.3 million project that involved the construction of ten single apartment units, a restaurant and mini-mart. Construction employment averaged 80 persons and with the start of operations, 20-35 persons will be employed.
- An estimated EC$1.5 million was invested in the construction of 24 apartment units at Lance-Aux-Epines, Boucan Luxury Apartments, and when that project became operational in August 2019, seven persons were employed.
- The Aashirwadh Apartments project, consisting of 12 one-bedroom units, cost an estimated EC $1.125 million and employed four fulltime staff when operations commenced in August.
- Buena Vista Apartments Co. Ltd. – This remodelling of an existing four-storey building to construct seventeen (17) self-contained apartments for student accommodation, created about 30 construction jobs. Eight persons are now employed full-time. The project cost was estimated at EC$4 million.
In the area of manufacturing, Prime Minister Mitchell announced that Aqua Natural Ltd expanded its water bottling operation with an investment of EC $2.7 million.
“The project became operational in June 2019, creating employment for over 30 persons”, he said.
The Prime Minister also announced that a number of tourism projects under construction will come on stream in 2020.
- The transformation of what was formally the Grenadian by Rex Resorts into the multi-million dollar Royalton Grenada by Sunwing Travel Group Inc., is well underway. More than 400 persons are employed in the construction phase of this $201 million-dollar project.
Mr. Speaker, 450 persons are expected to obtain permanent employment when the hotel becomes operational in the first quarter of 2020. With 269 rooms, the Royalton will be the largest hotel in Grenada.
- Reese Investments has pumped $85 million into a commercial complex of hotel rooms with full amenities, entertainment facilities and a business centre, which is nearing completion. Twenty persons will benefit from permanent employment when the facility begins partial operations early in 2020.
- Phase one of the luxurious boutique resort, known as The Point at Petite Calivigny Resort is about 95% complete. Its anticipated operational date is January 2020 and it will add 32 rooms to Grenada’s room stock. The second phase of that project, estimated at $100 million, is expected to begin shortly after the completion of phase one.
- Prickly Bay Waterside Ltd. has invested $8 million into an expansion project which has created construction employment for 30 persons. When the project is completed in early 2020, an additional eight persons will be permanently employed.
- Close to $10 million is being invested by Luxe Modern Residential Living to develop tourist accommodation in L’ance Aux Epines. The project is providing employment for 22 persons in the construction phase.
- In St. Paul’s, The Tower Estate Grenada Limited, a tourism facility, providing garden and farm tours, will upgrade and expand its site. Six persons are currently employed and another five persons will gain employment when the expansion is complete. A total of $750,000 will be invested in the project.
The Prime Minister announced that by June 2020, Government will introduce a ban on the importation of vehicles exceeding 10 years, and at the same time his administration will introduce a 50% duty reduction on the importation of electric and hybrid vehicles.
Speaking to reporters after the budget presentation, Dr. Mitchell addressed the issue of plans to finance the billion dollar budget.
Prime Minister Mitchell expressed confidence that there will be “a massive influx of activity next year”, stating that “key” in this venture is getting on stream projects that are outstanding in terms of implementation, so that the funding for these projects would not be lost.
“We could lose the grant funding if we don’t implement and that’s why the Ministry of Works is mandated to retrieve contract staff and not public sector staff. So, they started hiring a number of engineers in October and November, a number of people have been hired – planners, architects and managerial persons – and next year we will put $3m in grant funding…just for personnel to make sure they implement the projects, because last year we only implemented 55% of the projects that we had…”, he said.
He stressed that “people give you money and you don’t spend it (then) you are the ones that (are) going to lose and so we can’t afford that this year”.
Last year, Grenada only expended $98.1m out of the $183.7m in grants received.
PM Mitchell announced 24 projects that are expected to come on stream next year including the refurbishment of several roads across the country in a project earmarked to commence in March 2020.
And although some investors have been complaining about the slow supply of concrete and other building materials, Prime Minister Mitchell expressed confidence in the country’s ability to sustain and carry out these projects.
“That’s something that we also have to work on with the private sector, for example the asphalt plant needs to be put down. That would have of course impacted seriously on the roads and that is why the road situation is becoming a problem in 2019 because we did not have hot mix because the new plant was ordered, it came in late and then when it came in there was a problem of where to put it and I think we have to settle up that quickly and if that is done then we should be able to implement a lot of the road projects because you could see there are a lot of road projects in the budget (and) we should be doing better with implementation,” he said.
Commenting on the budget presentation in an interview with reporters, one youth said that he is specifically pleased to see emphasis being placed on Agriculture in the country.
“I am pretty much happy to see that a lot of emphasis is being placed on the agriculture sector because agriculture is one of our strengths.
So I am happy to see that…if you look at most of the countries that have elevated economically over the years they have a very good educational system so emphasis on agriculture is a very good thing because once you educate you create wealth,” the young man said.
President of the Grenada Union of Teachers (GUT) Lydon Lewis said the budget did not reflect what he feels is important, which is emphasis on Mathematics.
“There was no focus on Mathematics and that’s the main area of concern. Yes, there was focus on literacy and there is nothing wrong with that but Mathematics is also part of literacy…so, while we are creating greater policing of the system…this is not what is essential to the educational system because Mathematics is an area that has come under serious review in the last few years,” he added.
President of the Grenada Trade Union Council (TUC), as well as the Technical and Allied Workers Union (TAWU) and Labour representative in the Upper House of Parliament, Senator Andre Lewis said there was nothing in the budget that got him excited.
”I would have to review it (the Budget speech) but I have not heard anything that has gotten me too excited but obviously I have just heard it and I would want to review it together with the rest of the TUC,” he said in an interview with THE NEW TODAY following the Budget presentation.