Does Montserrat Have an Economic Future?

Does Montserrat Have an Economic Future?

Montserrat just listened to the 2018 Budget Presentation and Debate. As we followed, one remembered this article, and there were several since. How come we are only where we are now?

Having read the budget presentations, information, critiques and opinions, would you read this and ask, have we progressed or after 19 years later have we retrogressed, a very popular view?

December 1999

I am somewhat surprised that apparently nobody appears to be addressing the issue of how and when Montserrat’s economy is going to get restarted so that one day the island may be able to balance its books without relying on cash from Great Britain.

If the situation continues as at present then the UK is going to have to make up the short-fall between income and expenditure for many years to come. The UK government should be addressing this question now and, instead of working on annual budgets to ensure this country’s future, must analyse together with the Montserratian Government what amount of capital investment is needed over the next 2-3 years to ensure that the economy is kick-started, so that hopefully in the years to come Montserrat will become very much less dependent on aid from the UK as far as its economy and balance of payments is concerned.

It is evident that any such funds must be used carefully and a thorough review of the direct benefits to the economy of any such investments must take place initially – i.e. how many jobs will be created and what potential exists in respect of the export of the goods produced and/or the services provided. Everything possible must be done quickly for Montserrat to try to become self-sufficient from an economic point of view without delay.

One final issue – there exists on Montserrat a certain number of expatriates who are committed to the island and with a substantial investment here. These individuals have time available and, in many cases, substantial business experience from their previous careers. I find it difficult to understand why neither the UK Government nor the local Montserratian Government are not interested in utilising this resource and their experience as far as the local economy and its development is concerned, as their services and advice would certainly be made available without any charge and would surely be beneficial to the community in which they wish to share. 

Or, does this Editorial from March/April 2002 hold any significance today

“After Listening to the CM’s Budget Message, One Wonders, Does He Live on the Island?”

It would have been great if the Chief Minister had put some stress in his 2002 Budget speech this afternoon on the development with which he associated that ill-used word “sustainability.”

He spent very little time on the whole issue of the airport, for which he repeated he expects construction to commence in August this year and to be completed 16 months later, in December, 2003. He referred to the EC$7.5 million subsidy for transportation in and out of Montserrat by ferry and helicopter, stressing, therefore, the importance of the need for an airport.

He referred to varying available options, but if we were wealthy we would do better than Geralds. Instead, he said, we are accepting a “safe, reliable and affordable Geralds, with the necessary checks and balances that would accommodate Twin Otter or similar aircraft, at a cost of $41.5 million.” To attempt any other option would be to seriously retard Montserrat’s  recovery effort. This is just a “cop out” of a somewhat one-tracked view by those responsible for making the decision.

We suspect that the whole truth will be aired when the debate takes place Monday on why we could not wait to see whether the new government support to the private sector will bear fruit before trying to stretch an already cash-strapped people by increasing the ferry fare by 33.3 percent and increasing the weekend fare by 60 percent. It would be too painful to try and figure the wisdom in increasing the helicopter fare by over 68 percent.

We know this is our government’s way of confronting HMG’s squeeze on the residents of Montserrat, having forced us to accept whatever is handed down to us.

The CM was pleased to announce that his budget was void of any “tax increases,” as his government believed that further tax burden would only produce a far too negative effect on the economy of an already burdened country.

With all that, however, it doesn’t change the facts that the cost of living in Montserrat will keep going up as transportation fares increase. That affects everything. For one thing, it will increase the cost of exporting tourism, and import costs will go up. The comparatively high increase in the helicopter fares will certainly restrict travel to passages paid for by government and businessmen who will be able to pass on the costs in their prices, which also will obviously go up.

The bottom line for travel to and from Montserrat is that it is quite expensive, especially when you add overnight costs and inland transportation in Antigua because of the difficulty of making connections. Travelling to Antigua for shopping is no longer attractive, not even by ferry, but this might give some encouragement to local merchants to stock items they ordinarily wouldn’t for fear they would remain too long on the shelf or in the freezer.

The return fare to Nevis in the north and to Dominica in the south is now over $600, these being the nearest points after Antigua (not considering the French territory of Guadeloupe). Montserratians who wish to visit the doctor in Antigua will find it no longer cheaper. Good travel planning will be very essential, and it is clear that only those who can absolutely afford it, or whose travel is sponsored, will leave the rock for whatever reason.

One expected a budget where the Chief Minister would have called on Montserratians to strap-up for the hard times. He chose, instead, to refer to a current level of development which is somewhat baffling, since he didn’t point out those areas, even after he acknowledged that there is still a housing problem. He was also upbeat about the fact that the Montserrat Building Society, Bank of Montserrat and the St. Patrick’s Credit Union will all be in a position to offer mortgages by the end of the year.

We also have to be patient with the fact that those still in shelters now must grapple with having to pay for their keep, since those who cannot afford it will be taken care of by the Social Welfare scheme.

The government is placing great confidence in an otherwise very quiet private sector. The CM mentioned in the budget speech that businesses in the public sector will be passed on to the private sector. We have heard already of some of those plans, some of which cannot be right. What will be left is whether the spread will be sufficient to reach all the right corners and not just the usual few, to leave the rest begging.  

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Montserrat just listened to the 2018 Budget Presentation and Debate. As we followed, one remembered this article, and there were several since. How come we are only where we are now?

Having read the budget presentations, information, critiques and opinions, would you read this and ask, have we progressed or after 19 years later have we retrogressed, a very popular view?

December 1999

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I am somewhat surprised that apparently nobody appears to be addressing the issue of how and when Montserrat’s economy is going to get restarted so that one day the island may be able to balance its books without relying on cash from Great Britain.

If the situation continues as at present then the UK is going to have to make up the short-fall between income and expenditure for many years to come. The UK government should be addressing this question now and, instead of working on annual budgets to ensure this country’s future, must analyse together with the Montserratian Government what amount of capital investment is needed over the next 2-3 years to ensure that the economy is kick-started, so that hopefully in the years to come Montserrat will become very much less dependent on aid from the UK as far as its economy and balance of payments is concerned.

It is evident that any such funds must be used carefully and a thorough review of the direct benefits to the economy of any such investments must take place initially – i.e. how many jobs will be created and what potential exists in respect of the export of the goods produced and/or the services provided. Everything possible must be done quickly for Montserrat to try to become self-sufficient from an economic point of view without delay.

One final issue – there exists on Montserrat a certain number of expatriates who are committed to the island and with a substantial investment here. These individuals have time available and, in many cases, substantial business experience from their previous careers. I find it difficult to understand why neither the UK Government nor the local Montserratian Government are not interested in utilising this resource and their experience as far as the local economy and its development is concerned, as their services and advice would certainly be made available without any charge and would surely be beneficial to the community in which they wish to share. 

Or, does this Editorial from March/April 2002 hold any significance today

“After Listening to the CM’s Budget Message, One Wonders, Does He Live on the Island?”

It would have been great if the Chief Minister had put some stress in his 2002 Budget speech this afternoon on the development with which he associated that ill-used word “sustainability.”

He spent very little time on the whole issue of the airport, for which he repeated he expects construction to commence in August this year and to be completed 16 months later, in December, 2003. He referred to the EC$7.5 million subsidy for transportation in and out of Montserrat by ferry and helicopter, stressing, therefore, the importance of the need for an airport.

He referred to varying available options, but if we were wealthy we would do better than Geralds. Instead, he said, we are accepting a “safe, reliable and affordable Geralds, with the necessary checks and balances that would accommodate Twin Otter or similar aircraft, at a cost of $41.5 million.” To attempt any other option would be to seriously retard Montserrat’s  recovery effort. This is just a “cop out” of a somewhat one-tracked view by those responsible for making the decision.

We suspect that the whole truth will be aired when the debate takes place Monday on why we could not wait to see whether the new government support to the private sector will bear fruit before trying to stretch an already cash-strapped people by increasing the ferry fare by 33.3 percent and increasing the weekend fare by 60 percent. It would be too painful to try and figure the wisdom in increasing the helicopter fare by over 68 percent.

We know this is our government’s way of confronting HMG’s squeeze on the residents of Montserrat, having forced us to accept whatever is handed down to us.

The CM was pleased to announce that his budget was void of any “tax increases,” as his government believed that further tax burden would only produce a far too negative effect on the economy of an already burdened country.

With all that, however, it doesn’t change the facts that the cost of living in Montserrat will keep going up as transportation fares increase. That affects everything. For one thing, it will increase the cost of exporting tourism, and import costs will go up. The comparatively high increase in the helicopter fares will certainly restrict travel to passages paid for by government and businessmen who will be able to pass on the costs in their prices, which also will obviously go up.

The bottom line for travel to and from Montserrat is that it is quite expensive, especially when you add overnight costs and inland transportation in Antigua because of the difficulty of making connections. Travelling to Antigua for shopping is no longer attractive, not even by ferry, but this might give some encouragement to local merchants to stock items they ordinarily wouldn’t for fear they would remain too long on the shelf or in the freezer.

The return fare to Nevis in the north and to Dominica in the south is now over $600, these being the nearest points after Antigua (not considering the French territory of Guadeloupe). Montserratians who wish to visit the doctor in Antigua will find it no longer cheaper. Good travel planning will be very essential, and it is clear that only those who can absolutely afford it, or whose travel is sponsored, will leave the rock for whatever reason.

One expected a budget where the Chief Minister would have called on Montserratians to strap-up for the hard times. He chose, instead, to refer to a current level of development which is somewhat baffling, since he didn’t point out those areas, even after he acknowledged that there is still a housing problem. He was also upbeat about the fact that the Montserrat Building Society, Bank of Montserrat and the St. Patrick’s Credit Union will all be in a position to offer mortgages by the end of the year.

We also have to be patient with the fact that those still in shelters now must grapple with having to pay for their keep, since those who cannot afford it will be taken care of by the Social Welfare scheme.

The government is placing great confidence in an otherwise very quiet private sector. The CM mentioned in the budget speech that businesses in the public sector will be passed on to the private sector. We have heard already of some of those plans, some of which cannot be right. What will be left is whether the spread will be sufficient to reach all the right corners and not just the usual few, to leave the rest begging.