Why are we forgetting about our growth strategy and linked breakthroughs?
BRADES, Montserrat, July 9, 2019 – Montserrat’s GDP in 2017 was EC$161,886,544. Dividing by 4,900 people, that’s EC$ 33,038 per capita or over $120,000 per family of four on average. So, why aren’t we all happy at our prosperity? First, because, the average is obviously not what most people are getting, nor is an evenly distributed national income a realistic expectation.
A more instructive picture can be seen by taking our current recurrent budget, EC$ 137,772,200 and multiplying by four to get an idea of how much GDP we would need to readily sustain our level of basic government services: about, EC$ 550 millions. An economy of that size – about three times where we are now – would have a lot of room for general prosperity. Where, for our economy to grow that large over the next twenty years, it would have to grow at about 6.3% per year, on average.
(That sounds a lot like the 5 – 7% annual GDP growth rate the late Sir Dwight Venner said we need as the EC Dollar region, and it is similar to the target growth rate in our Economic Growth Strategy.)
But is such a high growth rate achievable and sustainable for Montserrat?
Admittedly, it would be a serious challenge. Early in this series, we spoke about a leaky tyre economy: in 1995 – 97 we hit a volcano pot hole and not only holed the tyre but bent the rim. So, when we patch the tyre and try to pump in air, it always leaks back out again. Just so, until our economy’s productive core is rebuilt, annual aid money cannot get us to self-sustaining growth, investor confidence and prosperity.
However, it can be done. To get it we have to first put catalytic infrastructure in place that opens up room for growth, also helping to rebuild investor confidence. Yes, the sea and air ports, the fibre optic cable, geothermal energy, even improved hospital and schools, etc. Hand in hand with that, we will have to attract and facilitate a wave of local and foreign investment that would feed such growth. That’s what the 2012 MDC Business case argued for, and it is what our Sustainable Development Plan and Economic Growth Strategy are about. Let’s remind ourselves on the core EGS framework, which uses a SWOT analysis to figure out a good way to go forward:
It doesn’t take a genius to see that this analysis is on target. Looking at the OPPORTUNITIES box, we can see that Tourism is the obvious shorter term growth driver, but high capacity digital connectivity opens up the longer term opportunities for digitally based, globally accessible services. We must go digital or go bust, and that’s why we looked at digital transformation of education last time.
That’s also why the breakthrough sea port and fibre optic cable projects target major opportunities, as does the in-progress work on alternative energy (solar and geothermal). Airport upgrade and getting a better fleet of aircraft (Twin Otters to begin with) are a start, though it looks like our economy and tourism will have to show enough growth before we can make a good case for investing in a 5,000-foot, Boeing 737 jet-capable runway – which will probably require building a new airport. The good news on that is, that St Barths has been able to move ahead with a small airport as there is a good International Airport next door in St Maarten; that suggests that we need to further cultivate our air and sea travel links with Antigua, St Kitts and Guadeloupe.
The official Economic Growth Strategy was created through stakeholder consultations and builds on obviously sound analysis as we can see for ourselves. Much the same can be said for our Sustainable Development Plan and Physical Development Plan.
It is therefore unfortunate that too many voices in our print, electronic, online and social media seem to be ignorant of these plans. In some cases, it is worse than that: some who should know a lot better,
Similarly, let us notice a key point in the STRENGTHS box: UK support to OT’s under the UN Charter, Article 73.
This is our key lever in negotiations with the UK (as it has force of International Law that the UK has a “sacred duty” to carry out), and it is why Premier Romeo has now repeatedly gone to the UN, recently obtaining permission from the UK for a visiting mission. It is also the context for the December 7, 2018 UN General Assembly resolution on Montserrat, which clearly vindicates the Premier. In addition, this year provides a major opportunity for the OECS as a member state, St Vincent and the Grenadines, has been elected to sit on the UN Security Council, giving us a powerful voice through our friend, Dr Ralph Gonzalves. Unfortunately, it seems that many are still “stuck” on dismissing the significance of such a diplomatic breakthrough.
Instead of such ill-advised political rhetoric, let us instead refocus on our strengths and opportunities, building capacity to overcome weaknesses and counter threats, supporting and exploiting our five breakthrough opportunities.
As a reminder:
- Sea Port Development and
tourism opportunities
- Fibre Optic Cable & Digital Economy opportunities
- Alternative energy opportunities (solar, geothermal, etc)
- Development funding (through the UK CCRIF, the EU etc)
- A national Economic Growth Strategy
So, which is it going to be, crabs in a barrel fighting to pull one another down, or will we come together around a workable framework that builds a sound future for our nation?
