Source document: https://docs-lawep.s3.us-east-2.amazonaws.com/1698926946073.pdf (Saint Vincent and the Grenadines)
BUDGET ADDRESS 2016 Economic Growth, Job Creation, Zero Hunger, and Fiscal Consolidation Amidst Global Uncertainty Continuing by Dr.

The Hon.
Ralph E. Gonsalves Prime Minister of St. Vincent and the Grenadines Delivered on February 22, 2016 at the House of Assembly, Kingstown, St. Vincent and the Grenadines Office of the Prime Minister St. Vincent and the Grenadines February 22, 2016 CONTENTS Page INTRODUCTION (A) ECONOMIC GROWTH AND JOB CREATION (i) General Introductory Comments (ii) Public Sector Investment (a) (b) (c) (d) (e) (f) Economic Affairs Environmental Protection Health Housing and Community Activities Summary of Major Capital Projects Contribution of Recurrent Budget/Other Public Policies (iii) Private Sector Investment (iv) Some Strategic Public Sector Ventures (a) (b) (c) (d) (e) (f) Argyle International Airport The Geothermal Development Project and Energy Climate Change, Ocean Governance, and Resilience City at Arnos Vale A Modern Port Kingstown Educational Services as an Economic Niche (B) PRODUCTIVE SECTORS: A SUMMARY Agriculture and Fisheries (i) (ii) Manufacturing (iii) Construction (iv) Hotels and Restaurants (v) The Financial Sector (vi) Other Services (C) SOCIAL SECTORS (D) PUBLIC ORDER, PUBLIC SAFETY AND CITIZEN SECURITY (E) TOWARDS ZERO HUNGER 1 5 5 7 7 7 8 8 8 11 13 19 20 20 23 25 26 27 28 28 30 31 31 33 35 35 39 41 (F) FISCAL CONSOLIDATION (i) (ii) (iii) An Overview of Fiscal Consolidation Pension Reform Public Debt Management (G) RESOURCE REQUIREMENTS (H) FISCAL MEASURES General Value-Added Tax Excise Property Tax (a) (b) (c) (d) (e) Motor and Drivers Licences Vehicle Surcharge (f) Other Fees and Charges (g) (I) CONCLUSION ANNEXES/APPENDICES 46 47 50 52 54 56 57 57 58 58 58 58 59 59 Appendix I St. Vincent and the Grenadines Economic and Social Review: January to September 2015 65 Appendix II Beneficiaries under some social protection programmes 144 Appendix III Proposed Excise Duty Appendix IV Motor and Drivers Licences: Current and Proposed Appendix V Vehicle Surcharge on Vehicles over 4 years old Appendix VI Fees for Residence Permits, Work Permits, Citizenship and Renunciation of Citizenship Appendix VII Gun Licence Fees Appendix VIII Land Tax 146 147 148 152 154 155 2016 BUDGET ADDRESS ECONOMIC GROWTH, JOB CREATION, ZERO HUNGER, AND FISCAL CONSOLIDATION AMIDST GLOBAL UNCERTAINTY INTRODUCTION Mr. Speaker, Honourable members, this is the fifteenth Budget that I am delivering as Minister of Finance.
It has been crafted within weeks of the Unity Labour Party’s election victory on December 09, 2015, for a fourth consecutive five-year term in office.

To God we give the glory for this phenomenal political accomplishment; and we are thankful and grateful to the people for this vote of confidence, yet again.

This Budget, as contained, in the Appropriation Bill 2016, follows upon the passage, without dissent, in this Honourable House on January 29, 2015, of the Estimates of Revenue and Expenditure for 2016.
These Estimates total $912.9 million: Of this sum, Recurrent Expenditure accounts for $576.55 million; Amortization amounts to $116.67 million; Sinking Fund Contribution receives an allocation of $22.0 million; and Capital Expenditure is allocated $197.67 million.

A current account deficit of $11.9 million is budgeted in the Estimates, some 58 percent less than the budgeted deficit for 2015.
We shall seek, vigorously, in the actual implementation of the 2016 Budget to reduce the extent of this budgeted current account deficit.

Indeed, even in the face of a budgeted current account deficit of $28.5 million in 2015, we implemented the budget in a manner to secure, on the basis of the preliminary fiscal outturn for 2015, a small surplus of $6.2 million.

So, our intention in this regard in 2016 is not misplaced, barring unforeseen, adverse events.
The central theme for Budget 2016 is: “Economic Growth, Job Creation, Zero Hunger, and Fiscal Consolidation Amidst Global Uncertainties.” Each aspect of this thematic formulation is pregnant with meaning for the people of St. Vincent and the Grenadines.
Our government’s emphasis in 2016 is to facilitate further economic growth, create greater employment, including more quality jobs, accelerate a five-year push (2016 to 2020, inclusive) to achieve zero hunger, and to 1 | P a g e consolidate our fiscal condition, not through austerity, but by way of prudence and enterprise.

In 2015, the economy is estimated to have had real economic growth of a modest 1.4 percent.
The International Monetary Fund (IMF) and officials in the Ministry of Economic Planning are forecasting a better real economic growth in 2016 of 2.2 percent, but still not yet reaching a robust medium-term growth target of 5 percent.

Currently, the nominal Gross Domestic Product (GDP) at Market Prices is approximately $2 billion, an increase of some $200 million since 2010.
The GDP at Basic Prices in Constant (2006) Prices in 2015 was estimated at $1.5 billion, above the “pre-crisis” level of 2008; several countries in the Organisation of Eastern Caribbean States (OECS) are yet to return the “pre-crisis” levels of economic activity.
Financing Budget 2016 will be challenging within the context of the limitations of the small, open economy of St. Vincent and the Grenadines; the persistent structural weaknesses of an uncompetitive economy with colonial and plantation legacies; the economic slow-down in our regional and international partners; the uncertainties in the global political economy; and the on-going fallout from repeated recent natural disasters.
Still, our country possesses a bundle of strengths and possibilities which ensure that we continue to meet the multiple challenges in our national condition with a solid measure of success.
In successive Budget speeches, particularly since the massive global recession of 2008 to 2011, and its continuing adverse consequences, I have, over and over again, highlighted the structural limitations of the economy of St. Vincent and the Grenadines, the harsh effect of the removal of the preferential market treatment for our bananas in the United Kingdom, the debilitating impact of the continuing turmoil in global monopoly capitalism and its material discontents, the devastating blows inflicted on our small-island state through the terrible manifestations of a deleterious climate change, and home-grown restraints occasioned by the anti- social or violent conduct, and unproductive work habits, of a small minority of our people.
I again reaffirm all of this as the composite core of the contextual weaknesses and limitations of our social economy.

Unless we grasp properly the full meaning of this contextual frame for St. Vincent and the Grenadines, it would 2 | P a g e be hardly possible for us to fashion an appropriate strategic path forward, having taken account, too, of our strengths and possibilities.

And St. Vincent and the Grenadines possesses strengths and possibilities, not only limitations and weaknesses.
It is central to the development of our economy, and nation overall, that, as far as is humanly practicable, we reduce our weaknesses and limitations, and enhance our strengths and possibilities.

The core of our strengths and possibilities resides in ourselves, the people of St. Vincent and the Grenadines, at home and in the diaspora.

We are, increasingly, and largely, a skilled, industrious, and sophisticated people who are capable of running modern, competitive economic enterprises.
To be sure, there are gaps in the adequacy or sufficiency of our trained personnel, but such gaps can be, and are being, filled through prudent acquisition of the skills from abroad and by enhanced training of our nationals, concurrently.

Further, we are blessed with the bounty and beauty of our landscape of 150 square miles and our seascape of 10,400 square nautical miles.

Our land acreage though small, is fertile with an abundance of quality fresh water.
In our land, too, is the presence of substantial energy resources of hydro, geothermal, wind, and solar.

Our seas are full of a diversity of productive marine resources.

Our country’s geographic location and its tropical climate are bonuses, overall.
Mr. Speaker, in my 2013 Budget Speech, I addressed a raft of considerations which I consider apt to repeat here: “The inventory of our challenges and limitations, on the one hand, and of our strengths and possibilities, on the other, in their multiple dialectical interconnections, is the starting point to chart the way forward.

From a consideration of these flows the compelling developmental narrative of this ULP administration.
Our vision is people-centred based on our shared historical experiences and the resultant conscious expression of the uplifting Vincentian dream, for all.

Our philosophy is grounded in the universal principles of social democracy applied to the specific circumstances of our Vincentian condition.
is Our socio-cultural for advancement framework 3 | P a g e undergirded by our recognition of the authenticity, legitimacy, uniqueness of our ennobling Caribbean civilisation and its magnificent Vincentian component.

Our strategic economic outlook is premised on the quest to build a modern, competitive, many-sided, post-colonial economy which is at once local, national, regional and global.
Our governance agenda is focussed on reforming our constitutional, legal, and political apparatuses to enhance good governance, strengthen popular democracy and accountability, bolster fundamental rights and freedoms, enhance the quality and independence of the judiciary, and deliver responsible and responsive government.

Our unequivocal commitment to deepening regional integration, not as an addendum but as a core feature of national policy-making and implementation.
Our acknowledgement, and elaboration, of the assets of sovereignty and independence to be utilised in principled ways for the many-sided benefit of our people.
Our detailing of a wide-ranging bundle of policies and practical programmes which emerge from our extant condition and the practical fleshing-out of our vision, philosophy, socio-cultural rubric, economic strategy, governance agenda, and regional and finally, our fashioning of efficacious structures and systems of political-leadership and public management to implement the policies and practical programmes, within the interest of our people.” internationalist commitments.
And Mr. Speaker, the Election Manifestos of the ULP from 2001 to 2015, inclusive, contains the detailed policies, programmes and governance approaches which reflect our compelling developmental narrative.

This 2016 Budget is shaped, too, within the frame of the National Economic and Social Development Plan of St. Vincent and the Grenadines, 2013 to 2015 and the many regional and international developmental initiatives to which our government has contributed or subscribed.
Indeed, our Development Plan is designed with an overarching vision of “re- engineering economic growth, improving the quality of life for all Vincentians.” The St. Vincent and the Grenadines Economic and Social Review, January to September 2015, which is annexed to this Budget Address, and forms part of it, 4 | P a g e contains the relevant details of the immediate socio-economic backdrop and condition of our country.

There is thus no need for me to rehearse those details here.
I turn accordingly to provide the broad sweep, and relevant particulars, in the 2016 Budget under eight headings: Economic Growth and Job Creation; the Productive Sectors; the Social Sectors; Citizen Security; Zero Hunger; Fiscal Consolidation; Revenue Measures for 2016; and Resource Requirements.

The Ministers responsible for their respective portfolios will address the matters specific to those Ministries in the Budget.
(A) ECONOMIC GROWTH AND JOB CREATION (i) General Introductory Comments All things being equal, real economic growth and job creation are attained through the efficacious and harmonious workings, within, and through partnerships between, the private, cooperative, and the State sectors of the economy.

The investment for economic development, and job creation, comes from each of these sectors.

Domestic and foreign direct investment of a private kind are major investment contributors.
Substantial public sector investment takes place through the public sector investment programme of the central government and public enterprises (statutory entities and state-owned companies).
occur are: Agriculture The major productive sectors through which economic growth and job creation and Fisheries; Tourism; Manufacturing; Energy; Telecommunications; Wholesale and Retail Trade; Transportation; Banking, Insurance, Credit Unions, and Financial Services; Construction; Educational and Health Services; Real Estate and other Professional Services; and Creative Industries.

Historically, the economy of St. Vincent and the Grenadines has had a relatively low absorptive capacity for labour.
This fact is reflected in 5 | P a g e the continued stubbornness of the unemployment rate of roughly one- fifth of the labour force since the Second World War.

Interestingly, as the data from the 2012 Census show, although the actual number of employed persons increased from 35,036 in 2001 to 40,821 in 2012 ___ an increase of 5,785 persons or 14.7 percent, the rate of unemployment remained roughly the same (approximately 20 percent) in 2012 as in 2001.
This condition is explained by the fact that the labour force increased to 52,014 persons in 2012 from 44,984 in 2001, an increase of 15.6 percent.

The size of the labour force grew significantly between 2001 and 2012 despite the fact that the overall population increased marginally by only 0.01 percent between 2001 to 2012; the actual overall population in 2012 being 109,991 persons.
The significant increase in the size of the labour force in the midst of only a marginal increase in the overall population is explainable by way of the altered composition of the population: For example, the percentage of the population between 15-24 years fell between the inter-censal years 2001 to 2012 while the number of persons above 60 years increased sharply by 31.5 percent over the same period.

An increased number of the over-60 population actually remained in the labour force.
The finding in the 2012 Census that there has been an actual increase in the number of employed persons compared to 2001, is supported by the data of active registrants at the National Insurance Services (NIS).
The NIS data show that in 2000, there were 32,064 active registrants (30,061 active employees, 1,726 active employers, and 277 active self-employeds)); in 2014, there were 36,426 active registrants (33,642 active employees, 1,915 active employers, and 869 active self-employeds) an increase of 4,362 active registrants or an increase of some 14.0 percent.
So, the economy created an actual increase in jobs, but not enough to dent the unemployment rate in the face of the altered composition of the population and the increase in the size of the labour force.
This is 6 | P a g e one of the principal reasons why our government has been addressing in a focussed way the necessity and desirability of effecting structural changes in the nature of our economy through, among other things, investment, education, and health, appropriate private sector technological enhancements, and significant public sector investments in areas such as airports, energy, seaports, the roads and bridges networks, sea and river defences, information communications technology, housing, and initiatives in agriculture, fisheries, industry, and tourism.
This is what encompasses our quest to build a modern, competitive, post-colonial economy which is at once local, national, regional, and global.

(ii) Public Sector Investment The financing of the public sector investment programme comes from the following sources: Government revenues or the resources of state enterprises; grants from countries and agencies overseas; and local or external loans, mainly soft-loans.

The central government’s capital budget for 2016 amounts to $197.7 million.
Of the nine functional classification expenditure heads in the Capital Estimates, four have been allocated 88.1 percent or $174.2 million in the capital budget.

These four dominant functional classification heads in the capital budget are: (a) Economic Affairs, which receives a share of 52.5 percent or $103.8 million of the capital budget.

Projects financed under this heading include major infrastructural developments such as roads, bridges, and airport infrastructure.
Also included the central government’s capital under this heading expenditure on productive such as Tourism, Agriculture, Fisheries, and Telecommunications.

sectors is (b) Environmental Protection, which has been allocated $27.2 million or 13.8 percent of the 2016 capital budget.

As a small island developing state, St. Vincent and the Grenadines is 7 | P a g e extremely, and increasingly, vulnerable to natural disasters and the impact of rising sea levels as a consequence of climate change.
We must accordingly make the requisite investments to enhance our country’s resilience and disaster response capabilities.

(c) Health, which has received an allocation of $22.8 million or 11.5 percent of the capital budget.

The capital projects under “Health” are geared principally to improving the physical plant across the health sector.

(d) Housing and Community Activities, which account for $20.4 million or 10.3 percent of the capital budget.
Resources under this functional classification head are allocated to improve housing, the community levels.

rural development, and infrastructure at The other five functional classification heads which receive capital allocations are: General Public Services, Public Order and Safety; Education; Social Protection; and Recreation, Culture and Religion.

All nine functional classification heads are budgeted to receive, too, recurrent expenditure in 2016 of $715.2 million.
The total budget of $912.9 million contribute immensely to economic growth and job creation, among other things.

It is useful to provide a summary of the major capital projects earmarked to be implemented in 2016.
These include: (1) The Argyle International Airport: $30.8 million, inclusive of a $3 million contribution to the Argyle International Airport Capitalisation Fund; (2) The Regional Disaster Vulnerability Reduction Project: $9.3 million; 8 | P a g e (3) Caribbean Regional Communications Infrastructure Programme: $3.0 million; (4) Geothermal Development Project: $10 million; (5) South Leeward Highway: $12.0 million; (6) Natural Disaster Management Project – Hurricane Tomas and April 2011 Flash Floods: $5.9 million (7) Natural Disaster Management and Reconstruction Project – December 2013 Trough Event: $11.5 million; – Rehabilitation (8) Rehabilitation of Roads and Bridges/Road Construction: $4 million; (9) Housing Reconstruction/Rehabilitation Project: $5.5 million (10) Agricultural Modernisation and Development Programme: $4.6 million; (11) Rural Development-Community Development – BNTF7: $5.0 million; (12) Rural Development-Community Development – BNTF8: $3.0 million; (13) Improvement of Fishery Equipment and Machinery: $10.1 million; (14) Farmer Support Revolving Fund: $3 million (15) 10th EDF Modernisation of Health Sector: $11.8 million; 9 | P a g e (16) Modern Medical Complex, including Equipment: $5 million; (17) PAHO Smart Health Care Facilities: $3.5 million (18) Technical and Vocational Education and Training Development Project: $5.7 million (19) Tourism and Private Sector Development Project: $1.3 million; (20) Support for Education and Training (SET) Programme: $2.0 million; It is to be noted that the total cost of these twenty projects, excluding the Argyle International Airport, amounts to approximately $660 million, the bulk of which remains to be spent over the next three-to- four years.
Additionally, there are other capital monies ___ grants and soft loans ___ which are likely to become available during this very period, up to 2020, and beyond.

I repeat: All of these capital projects, and more, contribute to economic growth and job creation, among other things.

To be sure, there are challenges connected to the full implementation of the capital budget of $197.7 million.
These challenges include centrally: the timely draw-down of the grants and soft-loans; the inadequate or insufficient capacity in the public and private sectors in implementing the capital projects; and the unavailability on a sufficiently timely basis of local counterpart contributions to the particular capital projects.
Our government is confident that the streamlined capital budget for 2016 and the actual state of the projects’ preparation for implementation, ensure that the implementation challenges will be met, at least with more than moderate success.
In the public sector outside of the central government, continuing significant investments are planned to be carried out by VINLEC, the Central Water and Sewerage Authority, National Properties Limited, 10 | P a g e the National Lotteries Authority, and the National Insurance Services in partnership with a local credit union.
The recurrent budget’s direct contribution to employment is self- evident from the basic facts: The allocation for wages and salaries totals $281.9 million; and pension payments for retired public servants and the government’s NIS contributions for its current employees amount to $64.0 million.
Thus, in the aggregate, the recurrent spending in 2016 on current and retired employees of the central government amounts to $345.9 million or 60 percent of a total recurrent budget of $576.55 million, exclusive of Amortization and Sinking Fund Contribution.
Given the huge sums spent on public servants’ salaries, wages, and retirement benefits, the public have a reasonable and legitimate expectation that all categories of public servants would improve further their delivery of services to the public who pay them.

This is an important subject for an informed national conversation.

I intend to initiate such a conversation with the public servants and the general public.
In the recurrent budget for 2016, it is to be noted, too, that $85 million or 11.9 percent of the overall recurrent budget has been allocated to the category “Economic Affairs”.

through Additionally, the statutory bodies and other public enterprises, there is significant employment and local value-added.
Indeed, the 2016 Budget provides substantial contributions to these statutory entities and public enterprises, including: The Financial Services Authority ($2.35 million); Invest SVG ($1.30 million); SVG Community College ($13.1 million); Local Government Bodies ($3.6 million); BRAGSA ($13.0 million); and SVG Tourism Authority ($15 million).
Moreover, the 2016 Budget and an array of public policies undoubtedly facilitate the private sector, local and foreign, in their quest to create wealth, grow the economy, and increase employment.

11 | P a g e First and foremost, an efficient and effective system of public administration or management assists and engenders private sector development.
By and large, the public service and statutory bodies or public enterprises deliver on their obligations to provide services efficiently and on a timely basis at competitive prices.

Still, there are too many legitimate complaints by the general public and businesses of an uneven delivery of service particularly in vital areas of the public service.
Accordingly, I am urging public servants, police personnel, teachers, professionals and other workers in the health and educational sectors, and employees in the many public enterprises to be more productive and customer-friendly.

I reiterate that I intend to work closely with all relevant stakeholders to ensure that we lift “lift our game” uniformly in the delivery of public services.

We are all in this together as a small country.


Secondly, it is well-established that the fiscal and other public policies facilitate private sector of our government encourage and development.

At the same time, the private sector ought not to expect that this facilitation and encouragement mean that its private interests must be accommodated to the exclusion of other reasonable public policy concerns and those connected to the public interest or welfare.
In order to assist further the private sector, our government will soon cause to be appointed an Office of Private Sector Development within the Ministry of Economic Planning and Sustainable Development.

One of our government’s central aims this year, in the interface between the private sector and state agencies, is to improve markedly our performance on the “Ease of Doing-Business” criteria.
We simply must become more competitive in this modernised, global economy which does no favours to anyone, particularly small economies on the periphery of globalised capitalism.

Our government intends, too, this year, to appoint a Coordinator of Cultural Industries in order to boost wealth and job creation by our cultural artistes and entrepreneurs in the promising field of cultural industries.
12 | P a g e the strengthening of Mr. Speaker, at least four other leadership and managerial initiatives are being undertaken to bolster economic growth, job creation, fiscal consolidation, and an improved delivery of public services.

These are, first, the Inter-Ministerial Committees on Health and Wellness, Agriculture and Rural Development, and the Zero Hunger Initiative.
Secondly, the Public-Private Partnership venture in local governance for the Campden Park conurbation ___ to be declared the seventh city.

the capacity and administrative Thirdly, arrangements in the Ministry of Finance, the Customs and Excise, and Inland Revenue, respectively, to address debt management and internal expenditure controls, collection of tax arrears and improved tax administration, the stoppage of revenue leakages and an improved delivery of services at the Customs and Excise Department.
And fourthly, the establishment of a National Economic Advisory Council (NEAC) comprising of top officials and other distinguished professionals, business and labour executives from St. Vincent and the Grenadines, the region, and internationally, to provide structured advice, and more, on the economic development of our country.

Already, distinguished, and successful persons, in the fields of business, entrepreneurship, industry, wealth and job creation, have already consented to be part of the NEAC.
This body will be launched shortly.

(iii) Private Sector Investment Mr. Speaker, the global environment for trade and investment is changing rapidly.

Competition for both foreign direct investment and trade is intense.

For example, competition in tourism is increasing, both near home (for example Cuba and Dominican Republic) and further afield.

Countries both large and small are looking at ways to reduce the cost of doing business and are continuously assessing and improving their investment climate.
13 | P a g e St. Vincent and the Grenadines has a number of selling points which make it an attractive destination for doing business.

These include: • The significant progress made in re-orientating the economy towards a broad service based economy, while maintaining and expanding the solid base of agriculture and fisheries.

Service sectors’ contribution to employment and exports has grown rapidly in the past decade or so.
• The wide range of sites that are still available for the development of hotels and tourist facilities.

In addition, St. Vincent and the Grenadines can provide one of the most diversified tourism offerings in the Caribbean.

• St. Vincent and the Grenadines remains one of the most cost competitive countries in the region with significant cost advantages in terms of labour and general costs of living.

• The general regulatory environment in St. Vincent and the Grenadines ranks very well.
For example, the regulatory environment for anti- money laundering, on-shore and international financial services is on par with that in competitor countries.

• St. Vincent and the Grenadines continues to invest heavily in infrastructure and in productive capacity.

The completion of the Argyle International Airport will provide a significant stimulus for the further development of the tourism and other productive sectors.
Despite these significant attractions and possibilities, St. Vincent and the Grenadines is challenged in several areas.

These include: • The relatively high cost of electricity which persists despite the demand charge and in eliminating Government’s action introducing volume discounts industrial customers.
The high cost of energy is mainly attributed to the high for commercial and 14 | P a g e cost of imported fuel and difficulties in achieving economies of scale in power generation in a multi-island context; recently, the price of imported fuel has been falling but this is unlikely to last for any prolonged period.

• A shortage in supply of sufficient trained personnel in certain sectors of the economy.
• The relatively high cost of importing and exporting goods due in part to structural inadequacies and administrative inefficiencies at the Kingstown Port and Customs.

• Relatively high rate of corporate tax despite progress in reducing corporate tax rates.

Further progress towards lowering corporate taxes and simplifying the tax system will enhance competitiveness.
• The challenges posed by climate change, the high cost of adaptation and mitigation measures and building physical resilience that are vitally important for growth and development.

Invest SVG was created in 2003 to provide investment promotion, export development, business facilitation and research services to potential and existing local and foreign investors.
As competition for overseas investment continues to increase, it is ever more necessary that Invest SVG and the Government as a whole become more proactive in identifying strengths and targeting activities that matches these, while also promoting efforts to address weaknesses.

Public and private investments are to be ramped up in order to achieve higher levels of economic growth and job creation.
St. Vincent and the Grenadines has had, in recent years, above- average levels of foreign direct investment, as a proportion of Gross Domestic Product (GDP), comparatively, across the Caribbean and Latin America.

Domestic investment, too, has been on the rise in 15 | P a g e particular economic activities.

Most of the private sector investment has been in the hotel and tourism sector.
Investment of a more modest kind has also been put into other sectors, especially wholesale and retail trade, restaurants, manufacturing, agriculture and fisheries, transportation, estate development, financial and other services, including educational services to non-nationals, and entertainment.
telecommunications, construction, real Among the major domestic investment initiatives in tourism are those of the Kelly Glass Group at Blue Lagoon and at two locations in Bequia, including the well-known Plantation House; and the Browne Group at Spring Estate on the Windward side of St. Vincent.
Several local hoteliers, for example the Gunn family, have invested in refurbishing and expanding their hotels; and many local entrepreneurs have expanded, or constructed, apartments and guest houses for tourists and students attending the four medical schools.

An increased number of building permits and appropriate concessions has been approved for hotel expansions, the construction of apartments and guest houses over the last two years.
The NIS and the Government Employees Cooperative Credit Union (GECCU) are engaged in a joint venture to pursue a housing and commercial development on some 65 acres of land at Peter’s Hope.

This development project is being done in six phases over the period up to October 2020.

The NIS is developing 102 lots of land, ranging from between 5,785 square feet to 11,657 square feet; and GECCU is involved in developing 142 lots.
Phase I of the project, the construction of a spine road, and drains, was completed in 2015 at a cost of $1.6 million.

Phase II commences in March 2016 with further infrastructural work scheduled to be completed in July 2017, at an estimated cost of $3.1 million.

Land sales for middle-income housing and tourism/business facilities are being processed.

This is an exemplary partnership between the NIS and GECCU which presages other appropriate joint ventures involving the NIS and other domestic investors.
16 | P a g e local entrepreneurs or I again appeal to our local entrepreneurs to engage our government, the NIS, and National Properties Limited in serious discussion on possible investment opportunities of a credible or bankable kind.

Our government and its public enterprises are keen on investment their partnerships with investments.

Both the NIS and National Properties Limited have separately been partnering with local investors; and they are interested in doing more.
Further, specialised agencies of the government such as Invest SVG, the Centre for Enterprise Development, the National Centre for Technology Innovation, the SVG Bureau of Standards, and the SVG Tourism Authority are available to assist our entrepreneurs in the areas of their responsibility.

facilitating in Foreign direct investment in tourism development is on-going especially in the Grenadines, most significantly in Canouan.
At Canouan, developmental work in both the northern and southern parts of the island is proceeding apace consequent upon the resolution of the impasse between the two major developers six or so months ago.

It is vital that these investors be accorded the requisite level of support and encouragement by all stakeholders, including the local population.

I urge that we all adopt a mature and welcoming disposition especially when difficulties or challenges, real or imagined, arise.
It is problematic enough to attract foreign direct investment in this to react in an unnecessarily competitive world, for us then confrontational manner at any perceived slight.

Still, investors are strongly advised always to be sensitive and take account of the public interest and the juridical foundations upon which our country rests.

As always, in life, living, and production a sensible balance is wise and is likely to yield positive results for all stakeholders.
In the developed north of Canouan, the top-class Pink Sands Hotel/Canouan Resort has opened and construction is underway for several private villas.

Additionally, more villas are planned to augment the capacity at the Pink Sands/Canouan Resort itself.

17 | P a g e Investment of some US $250 million is being injected into the north of Canouan.

In the south, the US $100 million investment in the top- of-the-line marina and real estate development is proceeding well.
The government of St. Vincent and the Grenadines is a minority shareholder is spearheading this development in the south of Canouan.

Currently, employment in Canouan for nationals of St. Vincent and the Grenadines in the operation of the hotel and villas, in the construction of the various projects, and in consequential spin-offs, is in excess of 1,000 persons.
the Glossy Bay Marina Company which in Outside of the developed north and the construction activities in southern Canouan, further investment is planned by the developers.

Renovations and refurbishments are earmarked for the Tamarind Beach Hotel.

Consequent upon discussions, and in broad agreement with the government, the developers in the north are preparing a draft plan and concomitant financing for substantial improvements in the infrastructure in the main village on Canouan.
Tentatively, some US $20 million these itself has infrastructural undergone substantial enhancements in recent years due to major public sector investments by our government.

I predict that if carefully managed and supported responsibly by all concerned, Canouan is likely to become an even greater contributor to economic growth and employment than Mustique, which itself currently makes a gross contribution to the economy of some $100 million annually, including its employment of some 1,000 persons.
is proposed over a five-year period for improvements the village, which in On Bequia, the Morstedt Group is currently expanding its hotel operations by its investments at Friendship Bay.

This development adds to the Group’s hotel plant at the Bequia Beach Hotel, and the Grenadines House at Kingstown Park.

At Adams Bay, construction is underway, through Kelly Glass’s Group and a foreign investor, of several top-class villas.
Government approval has already been secured, too, for the construction of villas on Mayreau.

The 18 | P a g e investment at Petit St. Vincent continues to grow; and significant investments are planned for the improvement and expansion of Palm Island the Anchorage on Union Island.

The Government is engaged in discussion with possible investors for a major tourism development at Chatham Bay, Union Island.

On St. Vincent itself, major foreign investment is planned for Mt.
Wynne-Peter’s Hope on approximately 250 acres of land below the public road and bounded by the sea.

The Government of St. Vincent and the Grenadines and the international hotel group Karisma have signed a Memorandum of Understanding for the development of three hotels at this location.

At the same time a group of Canadian entrepreneurs and our Government have agreed for the construction of villas on other lands belonging to the State at Mt.
Wynne-Peter’s Hope; this latter project is slated to be on approximately 35 acres of land.

These very entrepreneurs are also in advanced discussion to build condominiums of 88 rooms on eight or so acres of the land belonging to the State at Anse Horry.

site of the E.T Joshua Airport, when The Arnos Vale decommissioned, is earmarked as the location for a new city.
A master-plan is being elaborated for this development but already our Government has signed a Letter of Intent with a highly-successful entrepreneur from Trinidad for the construction of an entertainment complex and boutique hotel at this planned new city.

Invest SVG has done commendable work in this regard.
(iv) Some Strategic Public Sector Ventures In the ULP’s Manifesto for the 2015 General Elections, major strategic ventures or initiatives were identified for our pursuance over the next five years which impact further on economic growth and job creation.
I shall comment briefly on five of them, namely: Argyle International Airport; the Geothermal Project and Energy; Climate Change and Ocean Governance, and Resilience; the City at Arnos 19 | P a g e Vale; a Modern Port Kingstown; and Education Services as an Economic Niche.

(a) Argyle International Airport The completion of the Argyle International Airport is imminent.
As a consequence, much focus has been placed on three urgent matters: putting the management structures in place for the airport’s operation, and recruiting the requisite personnel to operate the airport; finalising arrangements with several airlines which are interested in flying into Argyle International Airport; and securing the requisite regulatory approvals from the Eastern Caribbean Civil Aviation Authority, with which our officials have been interfacing continuously.
Satisfactory work is being done in all three areas.

Our government intends to commence actual operations at the airport, soonest!

This international airport has a central place in our government’s strategy for economic growth in the immediate future and beyond.
In this regard, it is to be noted that the International Monetary Fund (IMF) Staff indicated that the international airport is expected to increase tourist arrivals by 10 percent yearly over the next three years following its completion, with a cumulative impact on real GDP of up to 4.2 percent.
(b) The Geothermal Development Project and Energy the requisite documents formally In December 2015, establishing the legal relations between Emera Caribbean, Reykjavik Geothermal, and the Government of St. Vincent and the Grenadines, were signed.

The delays encountered in the formal preparation and signing of these contractual documents have inevitably pushed the commissioning and start-up of the geothermal plant from the end of December 2018 to early April 2019.
Some important milestones on which I now report are: 20 | P a g e A scoping report on the environment and social impact was completed by the Japan International Cooperation Agency (JICA) and submitted on December 29, 2015.

An Environmental and Social Impact Assessment (ESIA) commenced on February 08, 2016.

The consulting firm, Environmental Resources Management (ERM) has been awarded the contract for the ESIA services.
The Inter- American Development Bank (IDB) has provided grant funding for the services of ERM during phase I of the project.

The IDB’s grant of US $250,000 is part of the government’s equity contribution to the project.

On February 02, 2016, I signed in Abu Dhabi on behalf of our government the agreement with the Abu Dhabi Development Fund (ADFD) for the US $15 million concessionary loan.

These funds would be utilised in the post-drilling phase of the first production well is dug.
Resources are available from the CDB and IDB for the drilling phase.
the project, after The project schedule is as follows:- - Civil works (Soil and Water Investigation): January 25, 2016; - Civil Works Contract (to be awarded): July 25, 2016; - Construction of Well Pad (for production wells): August 15 – September 23, 2016; - Construction of Well Pad (for injection well): September 26 – November 04, 2016; - Drilling Contract (to be awarded): July 2016; 21 | P a g e - Rig Mobilisation: August 1 – November 25, 2016; - Grid Study: August 1 – October 28, 2016; - Drilling (3 production wells): November 28, 2016 – May 5, 2017; - Drilling (1 injection well): May 15 – June 23, 2017; - Well Testing (including all production and injection wells): July 16 – August 04, 2017 - Engineering Procurement Contract (EPC) (to be awarded): September 4 – October 13, 2017; - Plant Construction: March 05, 2018 – April 05, 2019 - Commencing and Start-up: March 11 – April 05, 2019 These time-lines are by their very nature flexible.
It is anticipated that they may well be abbreviated as the process unfolds.

Mr. Speaker, I remind Honourable Members that the estimated cost of the project overall is US $82 million of which the drilling phase is expected to cost US $32 million.

The project will be financed by 35 percent equity and 65 percent debt.

22 | P a g e low-cost kind.


Our government is continuing its search for additional funds of Further promising funding a grant or opportunities exist the Caribbean International Development Bank, Development (DFID) of the United Kingdom government, and additionally from the Abu Dhabi Development Fund.

The government of New Zealand is also lending technical advice.

the Department through JICA, IDB, for Meanwhile VINLEC continues to invest in the improvement of the hydro-plants and in solar energy.
The Energy Unit of the government continues its excellent all-round work in the area of renewable energy, particularly in respect of solar energy facilities on selected government buildings.

The initiatives of VINLEC and the Energy Unit are consistent with our government’s National Energy Policy, and Action Plan, upon which I have repeatedly commented.
(c) Climate Change, Ocean Governance, and Resilience Global climate change is creating immense challenges, and in many instances causing havoc to Mother Earth and her inhabitants.

St. Vincent and the Grenadines, and other Small Island Developing States (SIDS), contribute very little to global warming yet we are on the frontline of the very damaging consequences of climate change.
To St. Vincent and the Grenadines, climate change is an existential issue of the highest order; it goes to our very existence as a country.
For this very reason, St. Vincent and the Grenadines, the OECS and CARICOM are at the forefront internationally in championing the cause of SIDS, in seeking to ensure the arresting of harmful climate change and the prodding of developed countries and emerging economies, which are largely responsible for “man- made” climate change through the excessive carbon emissions into the atmosphere, to embrace meaningful “climate change” goals and to provide a sufficiency of resources for adaptation and mitigation.
23 | P a g e in the too, This policy thrust of our government regarding climate change is embedded, recently-adopted Sustainable Development Goals (SDGs) at the United Nations.
St. Vincent and the Grenadines has been playing an activist role in the Alliance of Small Island States (AOSIS), in the recently- constituted SIDS-DOCK (a veritable docking station for SIDS), in the Caribbean Climate Change Centre, and related entities in CARICOM, within the overall context of the United Nations Framework Convention (UNFCC).
In the latter regard, the December 2015 UN-COP21 in Paris was a vital staging post in the quest to adopt and implement a legally-binding global agreement in combating climate change.

The consequences of harmful climate change is evident in the more frequent and severely damaging adverse weather events that St. Vincent and the Grenadines, the Caribbean, and the world have been experiencing in recent years.

Accordingly, our government has been instituting measures to bolster the resilience of our country.
Among these are the following: (a) The setting up of the National Emergency Management Organisation (NEMO) and its strengthening; (b) the making of towards our country’s substantial budgetary provisions resilience; in fact in the 2016 Capital Budget there is an allocation of $27.2 million or 13.8 percent of the total Capital Budget directed towards the strengthening of our country’s resilience to natural disasters; and (c) the establishment of a specific ministerial portfolio of Sustainable Development which includes subject areas of climate change and oceans.
St. Vincent and the Grenadines has oceans amounting to 90 times our country’s landscape; the total area of our oceans amount to 10,400 square nautical miles.

Our government has elaborated a National Policy on Ocean Governance.

It is our duty to utilise our oceans and resources therein sensibly and 24 | P a g e sustainably for our people’s benefit.

Our quest for a Green Economy, including renewable energy, is conjoined with that of a Blue Economy grounded in our oceans.
(d) City at Arnos Vale Much preparatory work has been done regarding the building of a city at Arnos Vale site of the E.T.

Joshua Airport when it is de-commissioned.

Although, the state-owned Arnos Vale Development Company has been registered, to drive this project, the preliminary preparatory work is being done under the direction of National Properties Limited.
Clearly, this is a project which will take more than the five years of the usual election cycle to complete; it will be constructed in a phased manner.

It is intended as a public-private partnership and is hugely ambitious.

Already, our government has identified two major public sector-driven projects to be located there: A modern cruise ship pier and support facilities; and the Modern Acute Referral Hospital.

We are actively seeking funding for these two projects.
Additionally, the proposed entertainment complex, inclusive of a boutique hotel, is being pursued with a reputable entrepreneur from Trinidad in accordance with the already- signed Memorandum of Understanding.

The elaboration of the details of this venture will be presented to the public later this year.

Part and parcel of this initiative is an alternative route to and from Kingstown, possibly through a tunnel under Cane Garden.
The proposed modern city at Arnos Vale is to be placed within our governments overall for urban the cleaning-up and sustainable development, development of Kingstown, and the proposed development of Campden Park as a city.

strategic vision including 25 | P a g e (e) A Modern Port Kingstown The existing port facilities on St. Vincent are highly inadequate.

Port Kingstown is some sixty years old and is in a run-down condition.
The Campden Park Container Port (CPCP), though constructed only some twenty years ago, has deteriorated abnormally amidst structural problems; CPCP currently handles eighty percent of the container cargo for St. Vincent and the Grenadines.

In any event, the projected expansion of the container trade demands enhanced Port capacity.
The St. Vincent and the Grenadines Port Authority has caused to be conducted extensive studies on Port Modernisation by Mott Mc Donald of Canada through funding provided by the Caribbean Development Bank.

The preferred recommendation by the Consultants is that a modern port be constructed at the western end of Kingstown in the Rose Place area.

The estimated cost of the preferred option for the modern port is approximately US $50 million.
Several options are being weighed for the expansion, and possible relocation, of the cruise ship facility, preferably at Arnos Vale.

Further follow-up technical, and comparative cost assessments for the modern cruise facility are required before a final determination; but let it be clear that the current cruise ship facility cannot meet the requisites of a modern, competitive cruise industry.

Indeed, the current cruise facility is already a brake on the industry’s further development.
Our government and the Port Authority are exploring possible public-private partnerships for the construction of both the modern port and the expanded/relocated cruise ship facility.

We have been in discussions on these matters with investors from the USA, China, and the Middle East, and with multi- lateral finance institutions.
Further, we are pursuing in respect of the construction of the modern port facility, a possible 26 | P a g e funding source through the recent initiative of the United Kingdom government for infrastructural development in the Caribbean.

A modern port and an expanded cruise ship facility are vital for the modernisation and enhanced competiveness of our economy to increase economic growth and employment.
(f) Educational Services as an Economic Niche Our government to pursue aggressively educational services, mainly delivered to students who originate from overseas, as an economic niche for St. Vincent and the Grenadines.
is determined Currently, St. Vincent and the Grenadines benefits from the presence of four international medical schools (Trinity, All Saints, St. James, and American Medical Schools) with some 1,000 students, and the teaching of English as a second language to Spanish-speaking persons through the St. Vincent and the Grenadines Community College (SVGCC); there is a first batch of 50 teachers from Ecuador on a seven-month English Language programme at the SVGCC.
There is a huge potential for further growth in the student- intake at the medical schools.

Indeed, all four schools have concrete plans for further expansion.
the completion of The renovations and upgrade at the Milton Cato Memorial Hospital, the Medical Complex at Georgetown, the construction of two polyclinics (Buccament and Marriaqua), to complement the one at Stubbs, the improvements at the clinics, and the proposed Modern Acute Referral Hospital, are all intended to deliver optimal medical services to our people and to provide additional hospital and clinical facilities for use by the Medical Schools.
27 | P a g e The economy of St. Vincent and the Grenadines benefits from the presence of the overseas students through rental income for services, accommodation, transportation, and sale of food, drink, and other commodities.

On an annual basis, 1,000 students contribute an estimated $35 – 45 million to the economy of St. Vincent and the Grenadines.
entertainment restaurant and (B) PRODUCTIVE SECTORS: A SUMMARY The performance of the major productive sectors for the first nine months of 2015 is reviewed in detail in the SVG Economic and Social Review, January to September 2015 which is annexed to this Budget Address, and forms part of it.
I will thus not traverse that terrain, save and except to present some highlights in six main productive sectors of Agriculture and Fisheries; Manufacturing; Construction; Hotels and Restaurants; the Financial Sector; and Other Services.

(i) Agriculture and Fisheries For the period January to June 2015, the production of crops continued on its positive growth path as it did in 2014.
Following upon four years of consecutive growth, preliminary data show crop production as having increased by 21.0 percent to 33.4 million lbs.

Non-banana crops grew significantly, especially dasheen, plantains, eddoes and sweet potatoes.

Despite the droughts, floods, the on-going challenge of Black Sigatoka, and the virtual cessation of market preferences in the United Kingdom, activity in the banana industry continues to improve.
Preliminary estimates indicate an increase in banana production in the first half of 2015, although banana exports remained virtually unchanged at 1,969 tonnes.

Our government values highly the contribution of “the traffickers” in agricultural produce in the region.

They encounter several challenges which will be addressed comprehensively.

Accordingly, an Inter- 28 | P a g e Ministerial Committee has been set up to address these in tandem with the traffickers, farmers, and shippers.
In the fishing industry, there was growth for the period January to September 2015.

Preliminary data for this period reveal an increase in fish landings to 1.40 million lbs at a value of $8.5 million compared to 1.23 million lbs value at $7.3 million for the corresponding period in 2014.
The recurrent expenditure allocation for the Ministry of Agriculture, Rural Transformation, Forestry and Fisheries for 2016 amounts to $20.2 million, an increase over the allocation for 2015, and nearly $5 million more than the actual expenditure in 2014.

The increased allocation to this Ministry in 2016 is noteworthy particularly when account is taken of the fact that the portfolio of “Industry” was shifted in December 2015 to the Ministry of Economic Planning and Sustainable Development.
Capital expenditure estimates in the budget for 2016 in the Ministry of Agriculture has been put to $26.7 million.

It continues to be a Ministry of fundamental importance to our government and the people of St. Vincent and the Grenadines.

In addition to the significant budgetary allocations to this vital Ministry, to expand the overall public policies are designed agricultural production and to assist the farmers.
Among the beneficial policies for farmers are the soft-loans from the Farmers’ Support Company, the 75 percent duty-free concessions for farm vehicles, income tax exemption for income from farming, the provision of helpful extension services, and the assistance from the Banana Services Unit.
In 2016, our government is determined to improve the feeder road system through the Agriculture Modernisation and Development Project, BRAGSA, the Basic Needs Trust Fund (BNTF), and a 29 | P a g e specific feeder-road rehabilitation programme through the Ministry of Works.

(ii) Manufacturing For the first nine months of 2015, the manufacturing sector is estimated to have expanded.
The significant growth areas were galvanise sheets, up by 30 percent; beverages, up by 13.6 percent; alcoholic beverages, up by 20.7 percent, fuelled by regional exports; PVC pipes, up by 84.3 percent.

The output of flour declined marginally by one percent, due to tough regional competition.

The manufacturing sector receives a bundle of fiscal incentives, including the duty-free treatment for all raw materials imported in the manufacturing process.
This latter incentive, introduced by the ULP government, is very helpful to manufacturers, especially small-to- medium-sized entities.

Still, the sector, like other productive sectors, are constrained by restrictive lending by the commercial banks.

As at September 2015, the sum of $26.3 million was disbursed in loans to manufacturers, down 18.3 percent relative to the corresponding period in 2014.
It is imperative that our government’s proposal to the ECCU-member countries for the establishment of a Regional Development Bank to lend exclusively to the private sector be urgently addressed.

Small, stand-alone, national development banks are not adequate for this purpose.

I am pleased to report that on February 12, 2016, the Monetary Council of the ECCU decided to spearhead the process to establish such a Regional Development Bank in the shortest possible time.
(iii) Construction Value-added in the construction sector remained flat for the first nine months of 2015, amounting to $121.7 million.

Public sector investments particularly at the Argyle International Airport, the South in public housing activities, boosted Leeward Highway, and 30 | P a g e construction in 2015.
However, the practical cessation of construction in Canouan for most of 2015 occasioned by unresolved differences between the developers at that time, and the completion of several public sector projects, stalled growth in this sector.

Still, in the first nine months of 2015, there were promising developments in construction.

Commercial bank credit towards the construction sector increased by 10.2 percent over the corresponding period in 2014, from $22.3 million to $24.6 million.
Further, construction permits increased in this nine-month period by 25 percent over the comparable period for 2014.

These permits related primarily to the construction of new residences, new commercial construction, and building expansions/additions.

An inadequacy and insufficiency in capacity continue to limit the construction industry.

This many-sided challenge is being addressed in both the public and private sectors.
(iv) Hotels and Restaurants For the period January to September 2015, total visitor arrivals remained flat at 145,680 visitors, although the vital category of stay- over visitors increased by 4.0 percent compared to a 2.7 percent decline in the previous year.

Stay-over visitors represented the largest category of visitors, 37.6 percent.

Visitors by air, which accounted for 37.1 percent of total visitors, increased by 3.2 percent, while visitors by sea fell by 2.7 percent.
Yacht visitors declined marginally by 0.7 percent.

For the first nine months of 2015, there were 54,759 stay-over visitors ___ a 4.0 percent increase; in the previous two years this stay-over category declined by 1.7 percent and 4.9 percent respectively.

Increases in stay-over visitors were evident from all major source markets: USA, UK, Canada, and the Caribbean.
31 | P a g e The 4.0 percent decline in cruise ship passengers was mainly as a result of the 59.4 percent reduction in cruise visitors to Bequia, even though there were increases at Kingstown (8.0 percent), Canouan (7.8 percent), and Union Island (34.4 percent).
Several important developments in the tourism sector augur well for the immediate future, including: (a) The imminent opening and operation of the Argyle International Airport; (b) The significant on-going and prospective investments in hotels, villas, and apartments in the Grenadines and on St. Vincent itself, as I outlined earlier in this address; (c) An increase in the subvention to the SVG Tourism Authority in the 2016 Budget from $12 million to $15 million, to facilitate, among other tourism promotion and product development; things, (d) The continuation of the numerous fiscal incentives and other support for the tourism sector; (e) The enhancement overall of the Tourism Standards as overseen by the Tourism Authority; (f) The strengthening of security for citizens and tourists alike; (g) The proposal to clean-up Kingstown; (h) The elaboration of supportive public sector infrastructure initiatives.
32 | P a g e (v) The Financial Sector Central to government’s public policies in this area of the economy is the maintenance of a sound banking and financial sector, including insurance companies, the building and loan association, and credit unions.

Through the regulatory agencies of the Eastern Caribbean Central Bank, the Financial Services Authority, and the Financial Intelligence Unit, St. Vincent and the Grenadines has been able to ensure financial sector stability.
Continued diligence in regulation and a further sensible strengthening of the regulatory regimes for the various financial sector entities are on-going.

The International Financial Services sector continues to make an important contribution to the economy, although challenges abound.

Fee income earned from the International Financial Services in the first nine months of 2015 amounted to $2.9 million, a decrease of 2.8 percent compared to the corresponding period in 2014.
Mr. Speaker, unpaid BAICO policyholders continue to be agitated by the suspension of payments under the Relief Programme due to the non-receipt of the pledged resources from the Government of Trinidad and Tobago.

The sum of US $64 million is outstanding; and the long- awaited tranche of US $40 million is yet to come.
In my capacity as Chairman of the Insurance Sub-Committee of the ECCU Monetary Council, I have yet again written ___ last week ___ to the Government of Trinidad and Tobago requesting their fulfilment of their obligation.

I am hopeful that now that the new government in that country has properly settled in, they would meet their obligation to the ECCU on this matter.
We are awaiting, too, the passage of the Plan of Arrangement (BAICO and CLICO) Bill in some other countries of the ECCU in order for the Judicial Manager to proceed with the distribution of some US $30 million to BAICO policyholders in the ECCU member-countries.

Meanwhile in St. Vincent and the Grenadines, the claim of EC $145 million in the Law Courts against RBTT on a related BAICO matter instituted by the Supervision of Insurance of St. Vincent and the Grenadines is proceeding.
33 | P a g e On CLICO International Insurance (CIL), we in the ECCU have instructed our lawyers to appeal a judgment on a specific issue from a judgment of the High Court of Barbados which approved the implementation of what is a “Barbados First Plan”; this specific issue relates to CIL’s operation as a single entity throughout the ECCU.
At the same time, the ECCU has called on CIL’s Judicial Manager and the Government of Barbados to exercise transparency, fairness, and accountability in the exercise of the “Barbados First Plan”, and the Judicial Manager’s use of the premiums.

The work on the uniform Insurance Bill across the ECCU has been taking much longer than anticipated.

The third draft of the Bill was released for consultation in early November 2015.

Comments were due by January 31, 2016.


We are anxious for this Bill to be finalised and taken to the respective Parliaments.

There is urgency, too, for the the Eastern Caribbean Financial Regulatory establishment of Commission.
As regards commercial banking, there are a few issues to be highlighted: First, the reduction last year of the minimum savings rate in the ECCU has not translated in a reduction of the average lending rate to customers of the commercial banks; this is a matter to be kept under review.

Secondly, commercial banks continue to be averse to lending to the main productive sectors; the Monetary Council recently decided to address the banks on this matter in a regional and not in an isolated national context.
Indeed, even as money supply has increased due to a growth in private sector foreign deposits and savings deposits, the ECCB has noted a tightening of credit conditions and a falling of domestic credit in the ECCU by 4.4 percent in 2015.

Finally, it is imperative that the ECCU keeps a watchful eye on the challenges to corresponding banking arrangements in some member- countries.
34 | P a g e (vi) Other Services Significant contributions to the economy arise from the four medical schools in St. Vincent and the Grenadines, ships’ registration which netted in 2015 some $5.0 million, the creative industries and entertainment.

Our policy is to continue to promote aggressively these services and economic sub-sectors.
(C) SOCIAL SECTORS The details pertaining to the social sectors of Education, Health and Wellness, Housing, Social Development, sports and Culture are available in the 2016 Estimates of Revenue and Expenditure, inclusive of the Result Indicators, and will be elaborated upon in this Budget Debate by the Ministers with responsibility for these portfolios.

I shall, however, address briefly some important public policies particularly regarding Education, and Health and Wellness.
In respect of Education, our government will in 2016, emphasise the following, among other things: (i) Adoption formally of the Revised Educational Sector Plan; (ii) Continuing to pursue without let-up, every single facet of the Education Revolution; (iii) Working assiduously with teachers and parents to ensure a marked improvement in quality teaching, particularly in core subjects, and quality leadership in schools; (iv) Delivering value for money in the educational system, including cutting out waste and inefficiencies; (v) Aiming, overall, for education to deliver optimally on its four basic goals: 35 | P a g e (a) to train critical minds, fit to receive and transmit universal culture, including science and technology, but with a Caribbean particularity; (b) To produce persons with the requisite skills to man the in a modern, competitive production apparatuses economy which is at once local, national, regional, and global; (c) To inculcate in students the tried and tested values of our Caribbean civilisation, including those of its Vincentian component; and (d) To assist in fashioning finished, creative personalities and worthy citizens.
In the 2016 Budget, recurrent expenditure on Education is estimated at $120.3 million or 21 percent of total recurrent expenditure, exclusive of amortisation and sinking fund contribution.

This is a huge allocation.

Additionally, $11.65 million has been budgeted for capital expenditure.

Further, through the Student Loan Company, the government lends and guarantees some $6 million annually to economically-disadvantaged students to attend university.
Over the past 14 years, the government has guaranteed in excess of $85 million in these student loans.

Moreover, the government sources hundreds of scholarships for students to attend universities in the region and elsewhere.

to enable them In the area of Health and Wellness, several initiatives are to be emphasised in 2016, including: i. Finalising the elaboration and adoption, for implementation, of the National Strategic Policy on Health and Wellness; 36 | P a g e ii.
Finalising the adoption and implementation of the Patients’ Charter of Rights and Responsibilities; iii.

Focussing on the optimal delivery of the wide range of medical and health services offered by the public health delivery system, especially public health (including the war against Zika and other infectious diseases), primary healthcare and wellness, and hospital services; iv.
Accelerating further the capital infrastructure projects and programmes under the 10th EDF Modernisation of the Health Sector; implementation of the v. Implementing further the PAHO Smart Hospital Initiative; vi.

Continuing the practical elaboration of the project to build a Modern Acute Referral Hospital at Arnos Vale; vii.
Strengthening the integration of Visiting Medical Missions and specialist professionals at the four medical schools into the National Health delivery system; the work, for example, of the World Pediatric Project in St. Vincent and the Grenadines has been exceptionally good for our children and their families; viii.
Working assiduously with the National Insurance Services, in conjunction with other stakeholders and the general public, to fashion an appropriate National Health Insurance System for implementation in the medium-term; In order to facilitate the further elaboration and implementation of the policies and programmes in Health and Wellness, an Inter-Ministerial Committee on Health and Wellness has been established by Cabinet to be chaired jointly by the Prime Minister and Minister of Health.
Further, administrative and managerial support to the process has been 37 | P a g e put in place through the appointment of an experienced health professional as the Coordinator of Special Projects in the Ministry of Health.

In the 2016 Budget, the Ministry of Health, Wellness, and the Environment (Public Health) has been allocated recurrent expenditure of $66.77 million or 11 percent of the total recurrent budget, exclusive of amortisation and sinking fund contribution.
Additionally, $22.8 million in capital spending has been earmarked for this Ministry in 2015.

Thus, in the aggregate, the total budget (recurrent and capital) for this Ministry in 2016 is a whopping $89.6 million.

In terms of the functional classification of expenditure for 2016, the category “Health” stands fourth in the pecking order of expenditure, after General Public Services, Economic Affairs, and Education.

Clearly, Health and Wellness are priority areas for our government.
Much has been achieved, but much more still remains to be done.

It is well-known that among the major health challenges in St. Vincent and the Grenadines, and the wider Caribbean, are those connected to diabetes and hypertension.

These non-communicable diseases constitute a burden to individuals, their families, our country, and our health services.

Healthier life-styles grounded in better eating, drinking, and physical exercise habits are major preventative answers to diabetes and hypertension.
But, too many of us disregard these preventative answers.

So we suffer.

There has to be an enhanced focus on healthy living to ensure a marked reduction of diabetes and hypertension.

In addition to all the health and wellness initiatives to be further deployed and enhanced in this battle, I intend to apply our fiscal policy to spur a reduction in the consumption of sugar and certain drinks.

Later in my address, I shall announce the appropriate tax measures.
38 | P a g e Mr. Speaker, our government’s initiative to treat diabetic ulcers with the drug Herboprot-P is expensive.

The cost of the drug and the accompanying treatment per patient is approximately $30,000.00.

This treatment is not a miracle drug, but it has a success rate of in excess of 90 percent in patients for whom it is applicable.

Its success is likely to mean the avoidance of the loss of a limb.

Most of the patients are poor and cannot afford the treatment; so, the State has to pay.
The additional revenues from the enhanced revenue measures on sugar and some beverages will help to defray the cost of this initiative, and others, in battling diabetes.

I feel sure, the public, will support the very modest tax measure which I will propose in this regard, today.

(D) PUBLIC ORDER, PUBLIC SAFETY AND CITIZEN SECURITY The government’s central policy in the area of public order, public safety, and citizen security is to be tough on crime and tough on the causes of crime.
The first obligation of the State is to maintain law and order and public safety and to ensure citizen security.

Without public order, public safety, and citizen security, the economy will fall apart, organised society will disintegrate, and the rule of the jungle, manifested in the survival of the fittest, will prevail.

By and large, St. Vincent and the Grenadines remains a peaceful, law- abiding country, despite the misconduct of a small recalcitrant minority, including the purveyors of violence.
Our people are law-abiding and the institutions of the Police, the Prisons, the Coast Guard, the Immigration Department, the Customs, the Financial Intelligence Unit, the Office of the Director of Public Prosecutions and the Prosecution Service, and the Law Courts, function professionally, within the law, and independent of any political or other undue interference.
The functional classification category of expenditure entitled “Public Order and Safety” has been allocated in the 2016 Budget the sum of $66.57 million of which $61.34 million is provisioned for recurrent spending and $4.23 million for capital expenditure.
39 | P a g e At the front-line of public order, public safety, and citizen security are 836 Police Officers, 20 Rural Constables (to assist in dealing with praedial larceny), 15 Traffic Wardens, 91 Coast Guard Officers, 99 Fire Service Personnel, who are Police Officers, and 136 Prison Officers.

In all, therefore, there are 1,197 persons at the forefront of the State’s security apparatus.
This number is supported by some 600 watchmen of public buildings, and buttressed by private security at business places and homes.

Clearly, huge financial allocations are made by the State and the private sector to provide safety and security.

St. Vincent and the Grenadines is a well-secured country, judged from the standpoint of the sizeable number of security personnel who are deployed.

is located the Grenadines Still, St. Vincent and in a dangerous neighbourhood.
Criminals from other Caribbean countries, South and Central America, North America, and elsewhere come to our lands and seas to carry out multiple nefarious activities.

Fighting crime is a local, national, regional, and global venture.
It is for this reason that our government is part of the Regional Security System, IMPACS of CARICOM, INTERPOL, the relevant agencies of the United Nations, the Organisation of American States (OAS), and other hemispheric security entities, and regional professional bodies of Police Officers, Prison Officers, and Fire Fighters.

Our government works closely, too, on matters of public order and citizen treaty and security with friendly countries appropriate administrative arrangements.
internationally through Our government has elaborated a many-sided National Strategy on Crime Prevention, with supportive institutional arrangements for its on-going implementation.

Our crime-fighting strategy and tactics are continuously being refined to meet all threats to public order, public safety, and citizen security.
I continue to give the assurance that our government will not compromise on any of this, while at the same time respecting and defending the fundamental rights and freedoms of individuals as protected in the law.

Mr. Speaker, one final matter on public safety and citizens security.

It relates to road traffic.

In 2015, there were 25 fatal accidents on the roads of 40 | P a g e St. Vincent and the Grenadines caused by motor vehicles.

Such a state of affairs is wholly unacceptable.


There is too much carelessness and recklessness on the roads; there is insufficient consideration by too many motorists for other road users.

There are too many defective vehicles on the road; there are too many unlicensed drivers, unlicensed and uninsured vehicles on the road.

I am urging motorists to exercise due care and attention on the road, to obey the traffic laws, and pay the requisite monies for the licenses and insurance coverage.
I have asked the Police to step up their surveillance on these matters; and I have requested a comprehensive plan for law enforcement on the road.

This year, I intend to bring to this Honourable House a modern, revised Motor Vehicle and Road Traffic Bill and consequential legislation, to strengthen order and discipline on the roads.

I propose, too, to increase the fees for drivers’ licences and motor vehicle licenses to assist in defraying the costs for the use and regulation of traffic on the roads.
I will address these increases shortly when I announce the revenue measures.

(E) TOWARDS ZERO HUNGER Mr. Speaker, the facts and figures regarding poverty, indigence (“dirt poor” poverty), and under-nourishment in St. Vincent and the Grenadines are well- known.

In 1996, the Kairi Consultants of Trinidad and Tobago found that general poverty in St. Vincent and the Grenadines stood at 37.5 percent of the population and indigence was at 25.7 percent of the population.
By 2008-2009, the same group of Consultants assessed that general poverty had fallen to 30.0 percent of the population and indigence had dropped sharply to 2.9 poverty of the population.

Similarly in 1995, the Food and Agricultural Organisation (FAO) of the United Nations assessed the population were undernourished; by 2012, the FAO’s assessment was that undernourishment had decreased markedly to 3.5 percent of the population.
that 22 percent of Indeed, on two occasions, in 2013 and 2015, at their headquarters in Rome, the FAO formally recognised St. Vincent and the Grenadines as being one of 41 | P a g e a very select group of countries globally that had met the relevant targets of the Millennium Development Goals (MDGs) and the FAO’s World Food Summit Goals of more than halving both the percentage of the population living in extreme poverty (“indigence”) and the absolute number of persons who were under-nourished.
These outstanding accolades by a reputable international body are undoubtedly a tribute to the government and people of St. Vincent and the Grenadines.

In September 2015, at the United Nations, St. Vincent and the Grenadines, and all other nations globally, signed on to the achieving of 17 Sustainable Development Goals (SDGs) by 2030; the SDGs replace the MDGs of the earlier fifteen-year period, 2000 to 2015.
In October 2015, the Honourable Minister of Agriculture, Fisheries, Forestry, and Rural Transformation, introduced a motion in this Honourable House to establish, in accordance with a FAO proposal, a bi-partisan Parliamentary Front Against Hunger.

This motion was unanimously accepted by this House.

The ULP incorporated the SDGs, inclusive of the goal to end Hunger, as central to its policies and programmes in its Manifesto for the 2015 General Elections.
Further, the ULP pledged to get to Zero Hunger in St. Vincent and the Grenadines by the very ambitious date of 2020, not 2030, as prescribed in the SDGs; the ULP promised that its aim was to ensure that by 2020 “no man, no woman, no child would go to bed hungry at nights”.

Immediately upon returning to office after the general elections of 2015, the ULP government set about on its quest to achieve Zero Hunger.
Swiftly, it established an Inter-Ministerial Committee under the Joint Chairmanship of the Prime Minister and the Minister of Economic Planning and Sustainable Development; the Secretariat of this Inter-Ministerial Committee resides in the Office of the Director of Planning.

Swiftly, the officials of the Ministry of Social Development provided from its data base the names, addresses, and other relevant particulars of each of the approximately 3,000 persons whom it considers to be in indigence and hunger.
Through the diligent work 42 | P a g e of the relevant officials across the Ministries, a draft Plan to Achieve Zero Hunger has been produced, in accordance with a written Policy Declaration (including programmatic elements) on the subject by the Prime Minister.

Central to the draft National Zero Hunger Action Plan is the establishment of the Zero Hunger Trust Fund (ZHTF).
The ZHTF will support the multi- faceted efforts needed to eliminate hunger in St. Vincent and the Grenadines, and establish a model approach that can be replicated across the Caribbean.
The ZHTF is designed to achieve the following major objectives: Ascertain the precise extent of hunger in St. Vincent and the Grenadines; Ensure that the specific circumstances or condition of each person afflicted by indigence or hunger is addressed appropriately and successfully; Establish action-oriented programmes in education and training; health and wellness; housing; employment and productive work; and the strengthening of social safety nets; and Make sure that the targeted beneficiaries are transformed into self- sufficient and self-sustaining human beings.
The ZHTF will be established by statute law.

Its Trustees will be drawn from public servants, professionals, other esteemed personalities at home or abroad, and persons drawn from civil society organisations, inclusive of charitable entities.

The ZHTF will not have any politician or political activist among its Trustees.

Its Secretariat will be located in the Ministry of Sustainable Development.
It will support existing relevant “Zero Hunger” initiatives by the government and will itself spearhead others.

The funding of the ZHTF will be sourced from the Consolidated Fund, a special levy on telecommunications, grants from local, regional, and 43 | P a g e international organisations, donations from individuals, and grants from friendly governments globally.
I have already been in discussion on this matter personally with the Director General of FAO, the state authorities in Dubai, and an important charitable organisation based on Mustique.

I have received pledges of support.

A five-year Zero Hunger Action Plan is being fully elaborated, with particular components of the Plan being of a shorter time-span.

The estimated cost of the overall Plan is put at $10 million per year.
Our government intends to begin work on the ZHTF immediately with whatever resources are at hand.

I intend to impose a levy of two percent on mobile telephone calls and on international calls to be paid directly into the ZHTF in accordance with a specific statute law.

This levy is estimated to raise $2.7million annually.

I am personally pledging for each of the five years (2016 – 2020), one month of my net basic salary, to the ZHTF.
In effect, I will be taking an 8.3 percent cut in my net annual salary for each of these five years to support the push towards Zero Hunger.

In order to encourage contributors, especially businesses, to donate to the ZHTF I intend to amend the Income Tax Act to enable contributors to treat the contribution as a tax deductible expense for the assessment of taxes to be paid.

I will not myself take advantage of this amendment in respect of my contribution.
As always, in respect of the poor, the ULP government keeps its word.

In the recently-concluded general elections, the ULP pledged to increase the monthly public assistance for beneficiaries below the age of 65 years from $200.00 to $225.00 and to those 65 years of age and above, from $220.00 to $250.00, from January 01, 2016.

The naysayers and chronic doubting- Thomases charged that our promise in this regard was a mere election gimmick.
Within weeks of the elections, in the month of January, the recipients of public assistance got their increases as promised.

Our government, this Prime Minister, will NEVER deceive the poor!

We will always consider the poor; and for that reason the Lord will protect us in time 44 | P a g e of trouble, as advised by the Psalmist.

The Hebrew Bible had long assured us that the Lord our God will bless us in all our works and in everything that we put our hands to, in our generous consideration of the poor.
It is to be pointed out that in the recurrent budget for 2016, the sum of $77 million or 10.8 percent of overall recurrent budget has been allocated across several Ministries for Social Protection.

More specifically, there are numerous programmes in the 2016 Budget which already touch and concern the poor or economically disadvantaged.

These include: 1.

2.

3.

4.

5.

6.

7.

8.

9.
6.

7.

8.

9.

Social Assistance (including Social Welfare) and Home-Help-for-the-Elderly Child Development Youth Development (including YES Programme) Special Education Services (School for Children with Special Needs) Adult and Continuing Education School Feeding Programme Gender Development (including Crisis Centre) NEMO and Disaster Management Social Welfare (Transport Subsidy) : : : : : : : : : $17.5 mn; $ 1.0 mn; $ 3.2 mn; $ 1.8 mn; $ 2.6 mn; $ 1.3 mn; $0.52 mn; $0.85 mn; $0.94 mn; 45 | P a g e 10.
Geriatric Care (including Lewis Punnett Home) 11.

Nutritional Support Programme and Nutrition Unit 12.

Social Assistance Benefit (Ministry of Health) 13.

Book Loan Scheme 14.

Rural Development/Community Development 15.

Housing Reconstruction/Rehabilitation 16.


Social Assistance (including Medical Assistance) at PMO : : : : : : : $2.29 mn; $1.47 mn; $0.14 mn; $ 1.0 mn; $ 8.0 mn; $ 5.5 mn; $0.52 mn; These, and other such connected programmes, are to be utilised to assist in the drive towards Zero Hunger.

Under these existing programmes several thousands of persons are targeted to be served or assisted.
I have listed for Honourable Members, in an Annex to this speech a bird’s eye sketch, the number of some of these targeted beneficiaries particularly through some programmes in the Ministries of Social Development Education, and Health.

More details are available in the 2016 Estimates.

(F) FISCAL CONSOLIDATION Mr. Speaker, I shall address the issue of fiscal consolidation, under three specific headings: An Overview of Fiscal Consolidation; Pension Reform; and Public Debt Management.
46 | P a g e (i) An Overview of Fiscal Consolidation Our Government has made substantial progress in implementing its fiscal consolidation plan.

Tax compliance has improved significantly, due in part to implementation of e-filing for income taxes and the development of an arrears monitoring and management system.
The wage bill as a percentage of GDP and revenue has started to decline and practical strategies have been adopted to accelerate the process for elimination of wastage and misuse of Government resources.

These reform measures have already begun to pay dividends and the Central Government has realized small current account surpluses for the last two years.

Notwithstanding this considerable progress, there is still need for an even stronger fiscal consolidation to build fiscal space and improve resilience.
We are therefore implementing a number of measures to strengthen our fiscal position including further improvements to the revenue collection machinery, tax exemptions, restraining any excessive growth of wage and non-wage current expenditures, placing caps on transfers to state institutions, and an orderly reform of the public service pension system.
reduction of With respect to tax collection, while there has been significant progress in respect of arrears collection, the level of outstanding taxes is still too large, and now exceeds $250 million including interest and penalties.

The Inland Revenue Department (IRD) recently received support from CARTAC in strengthening the collection enforcement operations of the Department and has formulated new approaches and procedures for the collection of these tax arrears.
Four areas have been identified as pivotal to the overall reform of the IRD – the reform plan and program; reorganization, taxpayers to strengthen relations and services; and collections enforcement.

IRD also faces challenges related to the legislative changes 47 | P a g e existing skill set of staff, and inadequacies in office space.
Further, the question of workplace culture will be carefully considered in order to boost staff moral and motivation, leading to a continued sense of commitment to a new paradigm and work ethic.

Reform efforts are also underway at the Customs and Excise Department (CED).

The task of Customs has become increasingly difficult due to the proliferation of regional and international trade agreements, the greater sophistication of traders, and the multiple of shifting objectives imposed on customs.
Speedy release of goods is critical to supporting the competitiveness of traders and exporters.

There is also a need to adhere to international standards on value and classification as well as regional standards on rules of origin.

The upgrading of ASYCUDA was a major turning point in modernising the CED and reforming the nature of the relationship between traders and CED.
While there was initially much resistance and concern on the part of traders about the changes, this quickly turned to strong support for the system and its implementation which is recognized as a success for CED and the trading community.

There is also recognition that there have been improvements in release times for most traders.

While the overall state of the relationship is improving there remains considerable room for further progress.
Accordingly, we will be accelerating the reforms at CED to achieve the cultural and operational changes which are necessary.

This will require the continued presence of advisors and trainers to provide management and staff with an understanding of international best practices and the practical knowledge needed to implement and build capacity to sustain the changes being introduced.
The specific strategies to be pursued include: 48 | P a g e • • • • • Implementation of community; legislation to regulate the brokerage Strengthen client services and information available to the public to enable them to improve the self assessment system; Introduction of the code of conduct for employees of CED and adoption of procedures that provide little discretion to customs staff, and that have built-in accountability mechanism; Further elaboration of the “gold card” program consistent with international best practice to grant privileges to traders with strong compliance records; and Better rationalisation of the system for granting custom duties concessions.
On the expenditure side, efforts to implement measures to improve the efficiency of public expenditure, while promising, have had uneven results.

There is still a tendency by too many public servants to emphasize the size of appropriations, rather than the efficiency, effectiveness and quality of expenditure.

Further, efforts to encourage productivity by shifting the administrative culture in the direction of results-based management has a long way to go.
There has however been some success with a number of institutional restructuring measures aimed at through services and decentralized management of privatization of government spending.

spending efficiency improving On the basis of these considerations, our fiscal consolidation plan places emphasis on the development of a public management culture resting on the concepts of scarcity of public resources and the achievement of results.
Constant attention will be given to the prioritization of items of expenditure, both across and within sectors, 49 | P a g e and to the efficiency, effectiveness and quality of public sector services.
We have therefore provided funds in the 2016 Estimates for programmes which will promote this objective, including, an acceleration of the reform of the public procurement system, staffing of the Internal Audit Unit in the Ministry of Finance, upgrade of the monitoring and oversight framework for State Owned Enterprises (SOEs), upgrade of the Financial Management Information System to SMARTSTREAM 8, and an improved cash management system.
The upgraded and reformed Budget System which has been introduced in five Ministries from this year is an essential part of this This has required result-based public management paradigm.

institutional changes that allows for the establishment of formal mechanisms demanding of public agencies to set management objectives and goals regularly and assess their results periodically.
This is essentially an evolutionary process that calls for persistent efforts by public servants so as to enable it to take root in the day-to- day practices.

To ensure that these reform measures achieve the objectives of increasing the efficiency, effectiveness and quality of public expenditure, we will implement a programme of training of public sector employees to make them more business-friendly within a broader policy of modernizing the state.
(ii) Pension Reform Mr. Speaker, the growing cost to provide pensions and other retiring benefits is an area of real concern.

Expenditure on these benefits has doubled in the past eight years growing at more than twice the rate of the wage bill.

As at December 31, 2011, there was an implicit Government Pension Debt of $741 million or 37% of 2011 GDP.

This debt is the actuarial liability for providing promised pensions benefit into the future.
50 | P a g e There are five (5) separate pension plans which together constitute the public service pension systems for civil servants, teachers, police, judges, and elected parliamentarians.

These plans are all non- contributory and unfunded.

Further, the Public Service Pension System (PSPS) operates in parallel with the National Insurance Services (NIS).

The two systems are not coordinated, with a varying retirement age.
The current arrangement clearly poses significant risk for both the Government and the participants.

It is therefore of vital importance that participants and the general public understand the fiscal problems and risks posed by the pension systems and support efforts by the Government to institute much needed reforms.
In 2013, an actuarial analysis of the Government of St. Vincent and the Grenadines Public Service Pension System was conducted in order to identify reform options for reducing the Government’s long-term fiscal costs and to rationalize the combined pensions for PSPS and NIS to a level consistent with normal pension practice.

The analysis was based on data of the active pensionable employees and retirees as of December 2011.
Additionally, the analysis was based on a defined set of assumptions, actuarial cost method and principles.

The options recommended for the PSPS include:- • • • A reduction of the benefit accrual rate.

An increase in normal retirement age in stages, to age 65, consistent with the increase for the NIS.

Introduction of mandatory employee contribution rate of 5.0% of payroll.

51 | P a g e • • Phase-out of the PSPS to new employees.
Limit participants in the PSPS to a maximum pension from NIS of 30% of the Annual Insurable Earnings Limit.

It is our Government’s intention to have these recommendations considered carefully by all stakeholders, with the outcome being a reformed pension system than can be promulgated and enacted within the next few years.

The intention is to design the pension reforms in a sensible and sustainable way so as to protect the integrity of retirement benefits and the welfare of pensioners.
(iii) Public Debt Management Mr. Speaker, preliminary data show that as at December 31, 2015 the total outstanding public debt stood at $1.566 billion (76.9% of GDP) a decrease of 0.3% when compared to the debt of $1.571 billion at the end of December 2014.

Of this total $894.4 million or 57.1% was held externally with the remaining $672.0 million being held domestically.
The ratio of public debt as a percentage of GDP has risen moderately, which compares favourably with other member- countries of the ECCU; still, we intend to arrest this trend once the period of high capital expenditure associated with the airport and disaster rehabilitation tapers off, within the context, too, of an expanding GDP.
During 2015 there were significant draw-downs from ALBA, the Exim Bank of the Republic of China on Taiwan, and from the UK Export Credit Guarantee Department for continuing works on the international airport, as well as disbursements from the Caribbean Development Bank International Development and Association (IDA) for other ongoing projects including the South Leeward Highway Rehabilitation Project and the Disaster Rehabilitation and Vulnerability Reduction Project.
On the domestic (CDB) 52 | P a g e debt there were disbursements of new loans for the National Lotteries Playing Field Development Project, the National Student Loans Company, and for the International Airport Project from Petro Caribe.

the required The current debt situation has not arisen from any profligacy, and is quite manageable.

Indeed, the recent Debt Sustainability Analysis (DSA) indicated that St. Vincent and the Grenadines’ external debt distress remains moderate.
Government has placed a high priority on infrastructure for growth and the provision of development, and for poverty reduction.

As a result the public debt has been used, among other things, for construction of schools, roads, bridges, hospitals, clinics, river defences, and the international airport.

Other loans have been contracted for development of education, health, telecommunication, and support for LIAT.
We have also had to borrow heavily to replace damaged infrastructure in the aftermath of the many weather related events which have impacted St. Vincent and the Grenadines in the last decade or so.

For the year 2015 the Central Government expended some $143.1 million for servicing of the public debt, comprising $44.64 million for interest payments and $98.51 million for debt amortization and contributions to Sinking Fund.
Interest cost has been declining in recent years, but this has been offset by much higher cost for debt amortization and contributions to Sinking Fund.

For 2016 the cost of debt amortization and contribution to Sinking Fund is projected at $138.7 million, the equivalent of 25% of projected revenue.

High levels of debt repayment place a strain on Government’s finances and undoubtedly restricts Government’s provision of public services generally.
Given this constraint, Government has been exploring various options for restructuring the debt using the substitution and transformation principles.

Substitution basically constitutes a search for terms that can lengthen the repayment periods and reduce cost.

Transformation of both the debt profile structure and the debt management apparatus is always sensible in the quest to 53 | P a g e make the debt more manageable.
In this regard we will be conducting a Debt Management Performance Assessment in collaboration with the Eastern Caribbean Central Bank (ECCB) and will also update the Medium Term Debt Strategy.

The targeted Debt- to-GDP ratio for the ECCU-member countries, including St. Vincent and the Grenadines, has been set by the Monetary Council at 60 percent by 2030.
(DeMPA) The Medium Term Debt Strategy (MTDS) provides information on Government’s debt management objectives and outlines its plan for achieving a desired composition of its debt portfolio over the medium term.

It is crafted within the context of the Medium Term Macroeconomic Framework to provide quantitative analysis to evaluate the costs and risks of different debt management strategies.
The MTDS demonstrates Government’s commitment to carrying out its debt management objectives by implementing best practices aimed at achieving medium and long term debt sustainability.

(G) RESOURCE REQUIREMENTS Mr. Speaker, as I pointed out earlier in this Address, the expenditure budget for 2016 is estimated at $912.90 million which is some 6.0% less than the 2015 expenditure budget of $971.37 million.
The reduction in estimated outlay in 2016 is accounted for on the capital side of the budget which is 33.3% less that the capital programme last year.

Total estimated expenditure is comprised of current expenditure is $576.55 million, amortization of $116.68 million, contributions to Sinking Fund of $22.00 million, and capital expenditure of $197.67 million.
The main source of funding for the 2016 Budget is of course current revenue which is estimated at $564.63 million, 6.1% more than the 2015 Revenue Estimates, and 9.0% more that the amount actually collected in 2015.

Such an increase in current revenue in all the circumstances is a challenge, but we are confident that this revenue 54 | P a g e target could be met, and indeed, surpassed once the desired effort is made by those concerned with revenue collection.
Our confidence is based on a number of factors.

First, for 2016 we are projecting a 3.3% growth in nominal GDP (2.2% real growth and 1.1% inflation), and given the high correlation between revenue collection and GDP, this is envisaged to result in additional revenue of approximately $17 million.

Secondly, we are introducing a number of new revenue measures which together will yield an additional $20 million (that is, 1% of GDP).
Thirdly, we are taking serious action to improve tax administration and to collect the outstanding tax arrears due to the Government.

This renewed effort to improve tax administration includes a reduction in tax exemptions and concessions granted to various groups.

Financing for the capital budget will be provided from a mixture of grants, external loans, local loans, capital revenue and other receipts.
Grants totalling $53.73 are expected from the European Union in the amount of $15.49 million, the Government of Japan $20.00 million, the Republic of China on Taiwan $9.0 million, the Caribbean Development Bank $8.1 million, and other donors $11.14 million.

All of these Grants have already been approved and it is now up to the Government machinery to ensure that the projects to be financed from these funds are implemented in a timely and efficient manner.
Draw-downs from multi lateral institutions would account for $81.4 million (94.8% of the external loans) expected during this year.

The major multilateral lenders are the Caribbean Development Bank ($29.13 million), the UK Export Credit Guarantee Department in the amount of $25.5 million for the Argyle Airport, the Abu Dhabi Fund for Development of $10.00 million for the Geothermal Project, ALBA Bank $6.54 million and the International Development Agency $9.00 million.
Draw-downs on bilateral loans are expected from the Republic of China on Taiwan $3.5 million and Kuwait Fund $1.0 million.

55 | P a g e Local loans in the amount of $46.74 million will also be raised for financing of the Capital Programme.

Towards this end, a bill to authorize the Government to raise up to $50 million in the local and ECCU markets is before this Honourable House.

Included in the financing plan for 2016 is an amount of $149.6 million under the caption “Other Receipts”.
Various devices are available to the Government under this heading, for example, we still have available over 200,000 shares in the Bank of St. Vincent and the Grenadines from the batch of shares allotted for sale to the public.

There are various other state assets which may be made available for sale should the opportunity arise.

One additional option for financing the ‘Other Receipts” is through expenditure savings particularly on current expenditure.
The expenditure estimates are by nature very conservative and make provisions for various contingencies.

With proper management of these expenditures and in waste and inefficiency, we expect to restrict recurrent expenditure to within ninety to ninety-two percent (90-92%) of the budget.

This will provide cost savings of between $35 million and $60 million for the year.
the reduction through (H) FISCAL MEASURES (a) General Mr. Speaker, since the global economic and financial crises, it has become increasingly difficult for member-countries of the ECCU, including St. Vincent and the Grenadines, to raise the necessary resources to finance our growth and development.

A number of fiscal consolidation and debt restructuring measures, among other things, 56 | P a g e has been implemented by our government towards maintaining fiscal and debt sustainability.
In addition, a few tax measures have been introduced to increase revenue intake.

initiatives have produced moderate These results with an improvement in the fiscal balances.

There is need now for more revenue to finance our ambitious plans for growth which I have just outlined.

In this regard, emphasis will be placed on an increased revenue intake by reducing tax exemptions and concessions and improving tax administration and compliance.

I also propose to introduce the following revenue measures.
(b) Value added Tax than in other developing small The list of VAT exemptions in St. Vincent and the Grenadines is much wider island States.

Accordingly, in order to widen the tax base and to improve its buoyancy I propose to remove a number of items from the VAT exemption list and the zero-rated listing with effect from May 01, 2016.
The list of items are: Zero-rated items to be made taxable (i) (ii) Whole chicken and chicken parts (except chicken back, necks Package rice for retail sale and wings) (iii) Table and cooking butter (iv) Brown sugar Exempted items to be made taxable Lentil and pigeon peas (i) (ii) Cooking oils (except coconut oils) (iii) Shortenings (iv) Salt (v) Yeast 57 | P a g e (vi) Baking powder The revenue yield is estimated at $8.00 million per annum.
(c) Excise As pointed out earlier I proposed to increase the Excise Tax on alcoholic and some other beverages as shown in Appendix III.

(d) Property Tax At the time of introduction of the new property tax system, a concessionary rate of 0.06% was instituted for all commercial properties.

At that time I indicated that this was a temporary arrangement to give businesses time to adjust to the new system.
I therefore propose to increase the rate on commercial properties from the present 0.06% to the standard rate of 0.08%.

The new rate will come into effect from the current tax year and will yield an estimated $300,000 per annum, most of which will accrue to the Kingstown Town Board.

As you are aware, a priority of the Government in 2016 is the cleaning-up of Kingstown and improving its appearance.

More resources are thus required.


(e) Motor and Drivers Licenses For the reasons which I indicated earlier, I propose to increase motor and drivers’ licenses by approximately 25% for the various categories as shown at Appendix IV.

The estimated revenue yield from this increase is $3.0 million.

(f) Vehicle Surcharge As is well-known, imported vehicles beyond a particular age, create environmental challenges.
Some countries in CARICOM impose 58 | P a g e bans on the importation of vehicles older than four years.

We do not, but we impose a special surcharge on them.

The surcharge payable on imported vehicles older that four (4) years was last adjusted in 2008.

I now propose to increase the charge by approximately 15% for each category shown at Appendix V. The revenue yield from this measure is estimated at $0.5 million per annum.
(g) Other Fees and Charges I propose to increase the fees payable for Residence Permits, Work Permits and Citizenship, Gun Licenses and Land Taxes as shown in Appendix VI, VII and VIII respectively.

The rates of land tax have not been adjusted for over twenty years despite the significant appreciation in land prices since then.

The estimated revenue yield from these composite measures is $0.75 million per annum.
(I) CONCLUSION Mr. Speaker, Honourable Members, the economy of our St. Vincent and the Grenadines has been through eight extremely challenging years, from 2008 to 2015, inclusive.

During this period, our small, multi-island, open, resourced-challenged, and vulnerable country has withstood mighty externally-sourced blows from the regional and global economy, and from adverse weather events associated with climate change.
Yet, this small nation of 109,000 persons on 150 square miles of territory has survived and thrived.

In the process, too, we have chalked up some impressive material achievements, including in Improved Living Conditions, and Job Creation, Education, Health, Housing, Airport Development, Roads and Bridges, and Poverty Reduction.
59 | P a g e Mr. Speaker, Honourable members, I have earlier addressed the immense progress which St. Vincent and the Grenadines has made over the past fifteen years in reducing extreme poverty and under-nourishment.

We have noted, too, that almost 6,000 more persons are in active employment today than in 2000.

And it is undeniable that the average wage of working people has increased sharply since 2000.
Indeed, the data at the NIS show that in the year 2000, the average insurable wage of the insured employees under the NIS was $12,459.41 annually but by 2014 the average insurable wage per insured person had risen to $19,193.68, or $6,734 more per employed insured person, on average, or an increase of 54 percent, an increase substantially in excess of the inflation rate.
Specifically, minimum wages have been increased thrice since 2001; all categories of public servants have been accorded salary enhancements through salary increases, annual increments, and pay rises through the Reclassification Exercise; and severance payments and other workers’ benefits have improved appreciably.

Meanwhile, the rate of inflation, especially in recent years has been low, and has never been more than moderate since 2000.
Clearly, on these and other indices, the working people are much better off in 2012 than in 2000.

Similarly, it is accepted by all objective observers that the poor and indigent persons on public assistance have had their material condition of life lifted markedly.

And the safety net of public assistance has widened to include many more persons, including children attending primary and secondary schools.

The current public assistance list contains almost 5,000 persons.
Mr. Speaker, at the NIS, social protection of the working people has been strengthened immensely.

The data show that in the year 2000, total benefits (pensions of all kinds, sickness benefits, maternity and funeral grants) amounted to $8.5 million; in 2015, the NIS delivered benefits in the sum of $51.6 million.

The principal driver of the increase is the Old Age Pension Category which amounted in 2015 to $39 million.
In fact, the aggregate of all pensions through the NIS moved from $6.5 million in 2000 to $45.3 million in 2015.

In 2000, there were 2,940 pensioners; in 2015, there were 6,693.

In 2000, the average pension per 60 | P a g e beneficiary was $44.27 per week; today, it is $130.30 weekly.

In 2000 the average minimum pension was $50.00 weekly; today, it is $70.00.
Mr. Speaker, many critics of our government, well-meaning and perverse, conveniently forget the following, among other things: Fuel prices rising to the unprecedented level of US $148 per barrel in July 2008; the worst global recession for 100 years from 2008 to 2011, the effects of which are still being felt; the CLICO-BAICO insurance debacle which generated liabilities for St. Vincent and the Grenadines of 17 percent of GDP; multiple natural disasters especially those of 2010, 2011, and 2013 which in the aggregate caused loss and damage amounting to over $650 million or some one-third of our country’s annual Gross domestic Product (GDP), and several unfortunate deaths; and the transmission of externally-driven infectious diseases such as Chikungunya and the threat of others such as Ebola and Zika.
Accompanying all this has been the acceleration in the process of the dismantling by Europe of the preferential market regime for our banana exports to the United Kingdom, a process which commenced after July 1993, but speeded up in the following years and particularly so after the year 2000.

This collapse of the market preferences for banana has dealt a body blow to the economy as a whole, but especially so for the rural economy.
After all, in its hey-day, banana exports amounted to $120 million in 1992; today, banana exports are valued at single digits or thereabouts.

Thus, the government has had to spearhead a rapid transformation of the economy while at the same time providing adequate safety-net arrangements and instituting a host of targeted strategic interventions in the economy and society to cushion all the adverse, externally-sourced challenges.
It is in this very period that we have witnessed massive infrastructural developments (for example, the Canouan Jet Airport, Argyle International Airport, Rabacca Bridge, Reconstruction of Highways, Health and Educational facilities, Police Stations, other Government buildings, Sporting facilities, and so forth); the Education, Health, and Housing Revolutions; hugely enhanced Social Protection; improved living standards and a rise in average 61 | P a g e per capita income; increased numbers of employed persons; a reduction in poverty; and a marked decrease in indigence and under-nourishment.
In the future, historians would marvel at our nation’s resilience and its huge developments and improvements in these especially challenging eight years, 2008 to 2015, inclusive.

Mr. Speaker, in this very period, the people stood firmly with the ruling ULP by re-electing it for a third consecutive term in 2010, and then a fourth consecutive term in 2015 with an increased majority of the popular votes.
By any measure, these impressive political accomplishments matched, indeed reflected, those in the economy and the society.

Mr. Speaker, St. Vincent and the Grenadines is still not yet out of the proverbial woods.
Difficulties lay ahead; the uncertainties in the global economy and the threats of infectious diseases from afar are ever present threats; so, too, are our continuing vulnerabilities to the deleterious effects of climate change; the troubling socio-economic costs of imported and home- grown criminal activities; and all this is compounded by the silly political antics of sore losers and other disgruntled elements who are unable to countenance a further five years in opposition.
Nevertheless in the face of these negative occurrences our government is undaunted.

We shall continue to address in a focussed way the challenges of financing and implementing this budget.

Those who have been preaching doomsday for 15 years have no credible answer, to our nation’s problems.
Under God’s guidance, the compelling developmental narrative of our government’s vision, philosophy, socio-cultural rubric, economic strategy, regionalist and internationalist solidarity, and good governance approaches, will see us through.

Mr. Speaker, our government is being faithful to the policies and programmes as outlined in the ULP Manifesto for the General Elections of December 2015.
Our faithfulness to this renewed Covenant with the people of St. Vincent and the Grenadines is reflected in the 2016 Estimates and Budget.

As Political Leader of the ULP, and as Prime Minister, I take 62 | P a g e seriously the sacrosanct pledges which we made to the people.

These are public policies endorsed in free and fair elections; and we shall carry them out in ways responsible and responsive to the people.
The professional public servants, whatever their private political views, are reasonably and legally obliged to act in pursuance of government policies and decisions, lawfully determined by Cabinet and Parliament.

To be sure, the public servants are duty bound to proffer advice dispassionately; that advice may or may not be accepted by the policy- makers, Cabinet and Parliament.
What no public servant can do is to sabotage or undermine public policy lawfully determined or to be recalcitrant in the exercise of his or her duties.

Fortunately, the vast majority of public servants conduct themselves professionally, and in accordance with the Regulations which govern the conditions of their employment.

I am pleased to report that the overwhelming number of public servants take seriously the task of nation-building.

And I thank them!
And I thank them!

Mr. Speaker, in this profound and sacred exercise of nation-building I am fortified by the touching words of someone whom I rarely quote, President Theodore Roosevelt of the USA, in a speech entitled “Citizenship in a Republic” and delivered at the Sorbonne in France in 1910: “It is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better.
The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood; who strives valiantly; who errs, who comes short again and again, because there is no effort without error and shortcoming; but who does actually strive to do the deeds; who knows great enthusiasms, the great devotions; who spends himself in a worthy cause; who at the best knows in the end the triumph of high achievement, and who at the worst, if he fails, at least fails while daring greatly, so that his place shall never be with those cold and timid souls who neither know victory nor defeat.” 63 | P a g e And so, Mr. Speaker, I end on a personal note: I thank Almighty God for according me an “unconquerable soul”.
Under Him, and at His pleasure, “I am the master of my fate; I am the captain of my soul.” I assure this Honourable House and the people of St. Vincent and the Grenadines that in “no fell clutch of circumstance” will I wince or cry aloud; nor will I surrender the people’s trust; and so my head is unbowed; my strength is renewed by an amazing grace; and in the pursuance of my duty I will not be found afraid of any challenges ahead.
Mr. Speaker, reverberating daily in my ears is the charge given to us, by the esteemed Bishop Sonny Williams of the Pentecostal Assembly of the West Indies, on the occasion of the swearing-in of the Cabinet on December 14, 2015, at Heritage Square.
His charge was issued through the magnificent and inspiring words of the Hebrew Prophet Micah [Chapter 6, verse 8]: “What doth the Lord require of thee, but to do justly, and to love mercy, and to walk humbly with thy God?” I take this sacred text to my heart, my soul, my very being.

It will guide me daily as I do my duty in leading the process of implementing the 2016 Budget, as contained in the Appropriation Bill before us.

Thank you!
64 | P a g e Appendix I St. Vincent and the Grenadines Economic and Social Review January to September 2015 Prepared by: Ministry of Economic Planning, Sustainable Development, Industry, Information and Labour 1st Floor Administrative Complex Kingstown, St. Vincent and the Grenadines 65 | P a g e Table of Contents List of Figures ............................................................................................................................... 68 List of Annexes ............................................................................................................................. 70 SUMMARY OF ECONOMIC AND SOCIAL ACTIVITY FOR 2015 ....................................... 74 REVIEW OF ECONOMIC AND SOCIAL ACTIVITY JANUARY TO SEPTEMBER 2015 .. 76 1. INTERNATIONAL AND REGIONAL DEVELOPMENT ................................................ 76 1.1 International Developments ........................................................................................... 76 1.2 Regional Developments ................................................................................................. 77 2.
ECONOMIC AND FINANCIAL DEVELOPMENTS ........................................................ 78 2.1 Consumer Prices ............................................................................................................. 78 2.2 Government Finances ..................................................................................................... 78 2.3 Public Debt ..................................................................................................................... 82 2.4 Debt Servicing ................................................................................................................ 83 2.5 International Trade ......................................................................................................... 83 2.6 Money and Credit ........................................................................................................... 86 3.
THE REAL ECONOMY ...................................................................................................... 89 3.1 Agriculture ..................................................................................................................... 89 3.2 Fishing ............................................................................................................................ 90 3.3 Manufacturing ................................................................................................................ 91 3.4 Construction ................................................................................................................... 92 3.5 Tourism (Hotels & Restaurants) .................................................................................... 93 3.6 Financial Sector .............................................................................................................. 95 4.
PUBLIC INFRASTRUCTURE ............................................................................................ 98 4.1 Public Utility .................................................................................................................. 98 4.1.1 Energy ..................................................................................................................... 98 66 | P a g e 4.1.2 Electricity ................................................................................................................ 99 4.1.3 Water and Solid Waste.......................................................................................... 100 5.
SOCIAL SECTOR .............................................................................................................. 102 5.1 Education ...................................................................................................................... 102 5.2 Health ........................................................................................................................... 107 5.3 Social Development ..................................................................................................... 111 6.
PUBLIC SECTOR INVESTMENT PROGRAMME ......................................................... 114 6.1 Introduction .................................................................................................................. 114 6.2 Overview ...................................................................................................................... 114 6.3 Financing the PSIP ....................................................................................................... 115 6.4 Sources of Financing .................................................................................................... 115 6.5 Composition of Actual Expenditure ............................................................................. 116 6.6 Expenditure by Source of Funds .................................................................................. 117 6.7 Sector Performance ...................................................................................................... 117 6.8 Prospects for 2016 ....................................................................................................... 125 7.
PROSPECTS....................................................................................................................... 126 8.
ANNEXES .......................................................................................................................... 127 67 | P a g e List of Figures Figure 1.1: Real Growth Rates 2011 -2015 ............................................................................... 76 Figure 2.1: Point-to-point Inflation Rates, Jan – Sept 2011 – 2015 ....................................... 78 Figure 2.2: Central Government Fiscal Operations ............................................................... 79 Figure 2.3: Composition of Current Revenue ........................................................................ 80 Figure 2.4: Composition of Current Expenditure .................................................................. 81 Figure 2.5: Composition of Total Public Debt 2015 and 2014 .............................................. 82 Figure 2.6: Import composition by SITC Sections ................................................................. 84 Figure 2.7: Composition of Import Markets ........................................................................... 85 Figure 2.8: Export composition by SITC ................................................................................. 85 Figure 2.9: Composition of Export Markets ........................................................................... 86 Figure 2.10: Liquidity Ratios .................................................................................................... 88 Figure 2.11: Weighted Average Interest Rates ....................................................................... 88 Figure 3.1: Composition of other crops ................................................................................... 90 Figure 3.2: Composition of Fish Landings ............................................................................. 91 Figure 3.3: Output Volume of main Manufactured Items ................................................... 91 Figure 3.4: Credit to the Manufacturing Sector ..................................................................... 92 Figure 3.5: Activity in the Construction Sector ...................................................................... 92 Figure 3.6: Construction permits issued January to September 2011-2015 ...................... 93 Figure 3.7: Stay- Over visitors by major markets .................................................................. 94 Figure 4.1: Brent Crude Oil Prices (Oct 2014- Sept 2015) ..................................................... 98 Figure 4.2: Electricity consumption 2014-2015 (Jan-Sept) .................................................... 99 Figure 4.3: Importation of fuel 2014-2015 (Jan-Sept) ........................................................... 100 Figure 5.1: Number of CPEA passes by sex ........................................................................ 102 68 | P a g e Figure 5.2: Overall Pass Rate, CPEA 2015 ............................................................................ 103 Figure 5.3: CSEC pass rate for the period 2006-2015 ........................................................... 103 Figure 6.1: 2015 Capital Budget by Type of Funds ............................................................. 115 Figure 6.2: 2015 Revised and Actual Expenditure by Types of Funds ............................. 115 Figure 6.3: Capital Budget by Source of Funds ................................................................... 116 Figure 6.4: Actual Expenditure by Type of Funds ............................................................. 116 Figure 6.5: 2015 Actual Expenditure by Source of Funds .................................................. 117 Figure 6.6: AIA - Control Tower and Met.
Station .............................................................. 119 Figure 6.7: Completed Bridge at Chateaubelair .................................................................. 120 Figure 6.9: Indian Bay Beach Facility .................................................................................... 121 Figure 6.8: Ongoing construction at the HMTI .................................................................... 120 Figure 6.10: Ongoing Construction of the Buccament Polyclinic ..................................... 123 Figure 6.11: Modern Medical Complex ................................................................................ 123 69 | P a g e List of Annexes Annex 1: GDP by Economic Activity in Current Prices 2010-2014 (EC$M) .................... 127 Annex 2: GDP by Economic Activity in Constant (2006) Prices: 2010-2014, (EC$M) .... 128 Annex 3: Percentage Contribution of Gross Value Added by Economic Activity in Current Prices: 2010-2014 ........................................................................................................ 129 Annex 4: Percentage Contribution of Gross Value Added by Economic Activity in Constant (2006) Prices: 2010-2014 .......................................................................................... 130 Annex 5: Rate of Growth of Gross Value Added by Economic Activity in Current Prices: 2010-2014 ................................................................................................................................... 131 Annex 6: Rate of Growth of Gross Value Added by Economic Activity at Basic Prices, in Constant (2006) Prices 2010-2014 ........................................................................................... 132 Annex 7: Point to Point Inflation Rate January to September 2011-2015 ...................... 133 Annex 8: Central Government Fiscal Operations (EC$M) ................................................. 134 Annex 9: Debt Composition in EC$M
 ................................................................................... 135 Annex 10: Merchandise Trade - January to September (EC$M) ....................................... 136 Annex 11: Stay –Over Visitors by Country of Residence ................................................... 138 Annex 12: Cruise visitors by Port of Entry ........................................................................... 139 Annex 13: Yacht visitors by port of entry ............................................................................. 139 Annex 14: Distribution of Assistance .................................................................................... 140 Annex 15: Leading Causes of Death (2010-2014)................................................................. 141 Annex 16: Number of HIV/AIDS Cases and Deaths (2010-2015) .................................... 141 Annex 17: 2015 Capital Expenditure by Type and Source of Funds ................................ 142 Annex 18: 2014 and 2015 Capital Expenditure by Type of Funds .................................... 143 70 | P a g e List of Acronyms Agriculture Modernization Programme Average Price for diesel Banana Accompanying Measures Building and Loan Association Brazil, Russia, India and Canada Basic Needs Trust Fund Caribbean Regional Communication Infrastructure Programme Caribbean Community Caribbean Development Bank Climate Investment Fund Caribbean Knowledge Learning Network Classification of Functions of Government Chronic Non-communicable Diseases Country Poverty Assessment Caribbean Primary Exit Assessment Consumer Price Index Cardio Pulmonary Resuscitation Caribbean Secondary Education Certificate Caribbean Single Market and Economy Caribbean Vocational Qualifications Central Water and Sewerage Authority Eastern Caribbean Central Bank Eastern Caribbean Currency Union Eastern Caribbean Telecommunications Authority European Development Fund e-Government for Regional Integration Project European Union Foreign
 Direct Investment Financial Intelligence Unit International Financial Services Authority Global Climate Change Adaptation Gross Domestic Product Global Environment Fund Giga Watt per hour Good Agriculture Practices Gross Value Added International Airport Development Company International Business Companies International Bank for Reconstruction and Development Information Communication Technology International Development Association International Monetary Fund Kilo Watt Hours Least Developed Countries Millennium Development Goals AMP APd BAM BLA BRIC BNTF CARCIP CARICOM CDB CIF CKLN COFOG CNCDs CPA CPEA CPI CPR CSEC CSME CVQ CWSA ECCB ECCU ECTEL EDF EGRIP EU FDI FIU FSA GCCA GDP GEF GWh GPA GVA IADC IBC IBRD ICT IDA IMF kWh LDC MDG 71 | P a g e NDMRP NESDP NIS NQF NTRC ODA OECD OECS PAHO POCA PSIP RRACC RDVRP RGSM SARs SET SIDS SVGCC SWMU UNEP US USD VAT VINLEC WHO XCD m b National Disaster Management Rehabilitation Project National Economic and Social Development Plan National Insurance Services National Qualifications Framework National Telecommunications Regulatory Commission Official Development Assistance Organisational Economic Cooperation and Development Organisation of the Eastern Caribbean States Pan American Health Organisation Proceeds of Crime Act Public Sector Investment Programme Reducing Risk to Human and National Assets from Climate Change Regional Disaster Vulnerability Reduction Programme Regional Government Securities Market Suspicious Activity Reports Support for Education and Training Small Island Developing States St. Vincent and the Grenadines Community College Solid Waste Management Unit United Nations Environment Protection United States United States Dollar Value Added Tax St. Vincent Electricity Services World Health Organisation Eastern Caribbean Dollars Million Billion 72 | P a g e Selected Key Indicators ( 2010 -2014) Real Sector Real GVA Growth (%) 2010 -2.3 2011 0.2 2012 1.3 2013 2014 P -0.2 2.3 Nominal GDP at Market Prices (EC$M) 1,839
 1,826 1,871 1,959 1,969 Per Capita GDP at Market Prices ( EC$) Point-to-Point Inflation Rate ( End of period) Point-to-Point Inflation Rate ( Period average) Travel Receipts (EC$M) Tourist Arrivals Fiscal Sector Current Account Balance ( % of GDP) Total Debt Outstanding ( % of GDP) Current Revenue ( % of GDP) Capital Revenue ( % of GDP) Current Expenditure ( % of GDP) Capital Expenditure ( % of GDP) Debt Service ( % of Total Revenue) Debt Service Ratio (%) External Sector Current Account Balance ( % of GDP) Capital and Financial Account Balance ( % of GDP) Overall Balance (% of GDP) Total Exports (% change) Total Imports ( % change) Monetary Sector Monetary Liabilities - M2 ( % change) Money Supply - M1 Net Foreign Assets Net Domestic Assets Social Sector Human Development Index (HDI) Rank Human Development Index (HDI) Net Enrolment Rate – Primary Net Enrolment Rate – Secondary Life Expectancy at birth ( years) Crude Mortality Rate ( per '000) Expenditure on Education ( % of Total Expenditure) Expenditure on Health ( % of Total Expenditure) N.a - Not Available 16,749 0.9 0.8 232.7 n.a 17,019 0.1 1.0 0.2 2.6 n.a 254.2 72,478 73,866 74,364 71,725 70,713 17,395 0.0 0.8 249.3 16,617 4.7 3.2 247.6 -1.7 65.4 26.6 5.4 28.3 4.5 27.9 4.3 -30.8 33.8 3.7 110.9 912.5 2.6 -3.8 475.3 639.7 n.a n.a 89.5 66.0 73.9 7.5 17.4 9.2 -1.8 67.8 25.0 2.5 26.7 3.9 26.3 4.6 -28.7 25.6 -3.3 103.5 895.6 -0.03 -4.1 393.2 715.8 85 0.717 83.7 87.9 74.2 8.0 21.2 8.2 -0.9 71.4 25.3 1.7 26.1 2.9 25.7 4.1 -26.3 29.1 2.9 115.4 964.3 6.6 8.9 408.8 775.2 83 0.733 75.7 73.6 73.4 7.8 17.8 10.5 -1.5 73.8 24.6 3.1 25.7 7.7 27.7 3.7 -30.4 35.2 3.3 132.6 999.0 8.8 3.7 493.8 792 91 0.719 73.9 74.5 72.5 8.4 21.0 12.2 0.5 78.5 26.6 1.6 26.1 5.8 27.4 n.a n.a n.a n.a 129.9 976.8 9.6 13.9 508.2 900.4 97 0.720 n.a n.a 74.9 n.a 19.0 11.3 73 | P a g e SUMMARY OF ECONOMIC AND SOCIAL ACTIVITY FOR 2015 Based on economic indicators for the first hotels and restaurants sector, combined to nine months of 2015, preliminary
 data fuel overall growth in tourism.
indicate that economic activity in St. Vincent and the Grenadines registered growth of 1.4 percent, when compared to the 0.2 percent decline in 2014.

This performance is based largely on increase activity in the agricultural sector, manufacturing, financial intermediation, high-end tourism (hotels and resorts), real Activity in construction, as measured by the imports of building materials was less predictable.

Imports accelerated in the first half of 2015, but sharply declined the second half.
Hence the contribution of the construction sector to GDP growth was negative.

estate and public administration.

The contribution of the wholesale and retail The improvement in the agriculture sector was largely on account of continued increase in production of other crops, higher sector to the 2015 GDP growth rate is estimated to have been negative as suggested by the decline in the fuel imports .

registered fish landings and steady output of Preliminary data at the end of 2015 indicate bananas.
Growth in manufacturing was on public sector investment was 4.2 percentage account of increases in the production of points lower than the 2014 figure.

The galvanise sheets and beverages which grew decline in the implementation rate could be by 29.9 per cent and 13.6 per cent, attributed in part to delays in the completion respectively, and regional markets fuelled of crucial procurement activities in key growth in alcoholic beverages (20.7%) programmes.
which outpaced the decline in non-alcoholic beverages (1.5%), thus resulting in the increase in the output of beverages.

While total visitors for the first nine months declined marginally, impressive growth in stay- over visitors and performance in the In 2015, lower prices for oil, along with other major commodities influenced low inflation.

The annual average inflation rate was negative 2.1 per cent compared with a 0.1 per cent in 2014.
The groups registering the largest decreases during 2015 were transport (6.9%), housing, water, electricity, 74 | P a g e gas and other fuels (4.8%), food and non- alcoholic beverages (2.3%) and restaurants and hotels (1.!%).

An analysis of the data indicates that economic activity is expected to improve in 2016, with real GDP projected to grow by 2.2 percent.

This performance is expected to be driven by continued expansion of the agricultural, manufacturing, financial intermediation and tourism sectors.
These projections do not fully reflect the full impact of the airport on the economy.

P a g e | 75 75 | P a g e P a g e | 76 REVIEW OF ECONOMIC AND SOCIAL ACTIVITY JANUARY TO SEPTEMBER 2015 1. INTERNATIONAL AND REGIONAL DEVELOPMENT 1.1 International Developments The global economy is projected to grow at Improved activity in the second quarter of 3.1 per cent in 2015.

This performance is 2015 contributed to the performance of the largely on account of improvements in the US economy.
In first six months of 2015, advanced economies while activity in the the US economy expanded by 2.6 percent emerging market and developing economies buoyed mainly by lower capital spending in slow down.

Low productivity growth in the sector and lower oil prices.

There was a some advanced economies, demographic general improvement in the unemployment transition, ongoing adjustment in many rate which fell to 5.1 per cent.
emerging economies, China growth realignment, lower commodities prices are some of factors associated with this performance.

The United Kingdom (UK) and Japan posted growth of 2.5 per cent and 0.6 percent in 2015 respectively.

The UK performance was largely as a result of Figure 1.1: Real Growth Rates 2011 -2015 expansion in the services sector as well as falling unemployment rates.
The opposite was the case for Japan after a rebound in the first quarter, there was some deterioration in economic activity as consumption fell and net exports declined substantially.

Economic activity in the Euro Area is recovering, as Spain, Ireland and Italy economies continue to record growth.

This growth was spurred by increased domestic demand which outpaced the lower than expected growth recorded in Germany.
During the first half of 2015, China’s 76 | P a g e Source: IMF World Economic Outlook Database October 2015 INTERNATIONAL AND REGIONAL DEVELOPMENT economy continued to post robust growth of merchandise trade deficit narrowed on 6.8 per cent, although the rate of growth account of a decline in imports and slowed.

This growth was mainly attributed increased levels of exports.

Monetary to increase consumption improvement in net liabilities and net foreign assets increased exports.
Economic activity in some advance while domestic credit decline.

On the other and emerging countries (Korea, Republic of hand liquidity in the commercial banks rose China (Taiwan) and Association of while the weight interest rate spread Southeast Asian Nations-ASEAN) between loans and deposits widened.

slowdown as export and domestic demand declined.

Meanwhile in Latin America, Brazil continues to record a decline in growth with declining commodity prices.
Mexico also recorded lower growth as a consequence of a fall in oil production.

1.2 Regional Developments Economic activity in the ECCU currency union continued on a path to recovery based on preliminary estimates for the first half of 2015.

This improved performance was fuelled by increased activity in construction, hotels and restaurants and agriculture.

There was evident growth in six member countries, while Dominica and Montserrat registered declines in economic activity.
All member countries experienced declines in price levels.

The fiscal operations showed improvement as a result of recording an overall surplus on the consolidated central government accounts compared to a deficit for the same period of 2014.

Total outstanding debt contracted as the 77 | P a g e ECONOMIC AND FINANCIAL DEVELOPMENTS 2.
1 Consumer Prices The annual average “point-to-point” inflation rate for the January to September 2015 was recorded at negative 1.6 per cent, compared to 0.1 per cent for the corresponding period in 2014.

All the monthly point-to-point inflation rates for the period under review were lower in 2015 than those in 2014.

The highest decline 2.2 percent was recorded in April, with the lowest being 0.2 per cent in January 2015.
Figure 2.1: Point-to-point Inflation Rates, Jan – Sept 2011 – 2015 S ource: Statistical Office, Min Economic Planning, Sustainable Development etc.

The “All Item” index was 105.8 for 2.2 Government Finances September 2015 compared with 107.6 in Central Government Fiscal Operations September 2014.

The central government fiscal operations for As at September 2015, three (3) groups the first nine months of 2015 turned in an recorded decreases.
These groups were improved performance when compared with transport (1.8%); housing, water, electricity, the same period in 2014.

Although current gas and other fuels (1.0%) and clothing and revenue fell marginally by 0.1 per cent to footwear (0.1%).

Six (6) groups increased, $374.9m, the current expenditure education (1.0%); restaurants and hotels experienced a larger decline of 1.1 per cent (0.3%); food and non-alcoholic beverages to close the period at $375.0m.
(0.1%); alcoholic beverages, tobacco and Consequently the current account improved, narcotics (0.1%); furnishings, household moving from a deficit of $4.0m in 2014 to a equipment and household maintenance much smaller deficit of $0.05m in 2015.

The (0.1%); and miscellaneous goods and overall deficit also contracted from $38.3m services (0.1%).

Three groups remained in 2014 to $27.0m in 2015. unchanged, health, communication and recreation and culture.
78 | P a g e ECONOMIC AND FINANCIAL DEVELOPMENTS Figure 2.2: Central Government Fiscal Operations increase in corporation tax receipts while individual and withholding taxes declined by 4.5 per cent and 3.5 per cent respectively.

The enhanced collection of corporation taxes was due mainly to the collection of arrears.

Property tax receipts rose by 19.9 per cent to $3.4m.

This was marginally 0.9 per cent above the amount budgeted for this item to date.
Revenue from international trade taxes which amounted to $141.3m increased by 9.3 per cent when compared with 2014.

Under this rubric all the major revenue sources except travel tax and direct entry tax registered improved performances during the period.

Import duty, excise duty and VAT improved, growing by 6.9 per cent, 16.4 per cent and 5.6 per cent, respectively.
These performances were impacted by a 7.9 per cent reduction in revenue loss during the period on account of a significantly lower amount of duty free concession granted.

Receipt from customs service charge which increased significantly by 16.3 per cent, benefitted from a 1.0 per cent increase in the rate during 2015.

The 15.8 per cent rise in receipt from vehicle surtax resulted mainly from an increase in the importation of used vehicles during the period.
79 | P a g e Source: Ministry of Finance Current Revenue Current revenue as at September 30, 2015 totalled $374.9m.

This amount was marginally a 0.1 per cent lower than the amount collected during the same period of 2014.

The figure is composed of tax revenue of $347.2m and non-tax revenue of $27.7m.

During the period, tax revenue increased by 5.0 per cent while collections from non-tax sources fell by 37.8 per cent.
Of the major tax revenue items, collection from taxes on income and profits and taxes on international trade improved but takings from taxes on domestic trade and licences fell.

All the major components of non-tax revenue performed lower than during the same period in 2014.

Revenue from taxes on income and profits grew by 8.8 per cent to $90.0m, on the strength of a significant 58.4 per cent ECONOMIC AND FINANCIAL DEVELOPMENTS Taxes on domestic trade which totalled less than the amount collected in 2014.
This $90.5m declined by 1.2 per cent during the was mainly due to lower receipts from period.

Lower revenues collected from merchant international fees (16.8 %) and stamp duty and VAT was responsible for the fees from offshore financial services (5.1%).

deterioration, as receipts from these items Revenue from interest, rents and dividends fell by 13.6 per cent and 1.2 per cent, also deteriorated significantly moving from respectively.
The fall in receipt from stamp $13.9m in 2014 to $5.5m in 2015. duty was due to lower land sales recorded during the period.

Notwithstanding the Receipts from other revenue fell overall fall in revenue, receipt from excise significantly during the period moving from duty, insurance premium tax and interest $16.7m in 2014 to $8.4m in 2015.
This was levy were stronger, experiencing growth of mainly because a significant amount of the 10.7 per cent, 6.3 per cent and 16.0 per cent, monies received under this rubric in 2014 respectively.

The improved collection of was of a non-recurring nature.

Therefore excise duty was partly the result of enhanced with no such receipt in 2015 the result is a enforcement effort by the Inland Revenue comparative decline in revenue for the Department (IRD).

The relatively significant period.


growth in receipt from interest levy was mainly due to the collection of arrears.

Figure 2.3: Composition of Current Revenue Licences grossed $21.4m; this was 9.5 per cent below the amount collected in 2014 and mainly due to a significant drop in collection from alien land holding licences consistent with lower land sales.
Revenue from non-tax sources declined moving to $27.7m in 2015 from $44.6m in 2014, representing a significant 37.8 per cent decline, as all sub-components declined during the period.

Receipt from fees, fines and permits totalled $13.9m or 1.0 per cent Source: Ministry of Finance 80 | P a g e ECONOMIC AND FINANCIAL DEVELOPMENTS Expenditure cent mainly due to reduced expenditure on As at September 30 2015, current utilities, supplies and sundry expenses expenditure amounted to $375.0m.
This during the period.

figure represents a 1.1 per cent reduction in spending when compared with the same Figure 2.4: Composition of Current Expenditure period in 2014, as all components of current expenditure except the wage bill recorded lower levels of expenditure.

Payment of personal emoluments and wages amounted to $172.6m and $14.7m, respectively.

Personal emoluments increased by 1.4 per cent mainly on account of increases in increments during the period.
Wages increased by 6.1 per cent mainly as a result of increased payments by the ministries of Agriculture, Education and Health of 8.3 per cent, 18.9 per cent and 2.4 per cent, respectively, reflecting an enhancement of their work programme over the period.

Interest payments fell by 4.1 per cent to $31.9m due to the lower amount paid on the domestic component mainly resulting from the maturation of an amortised bond in late August 2014.
Source: Ministry of Finance Capital Receipts Capital inflows as at September 30, 2015 amounted to $27.4m.

This represents an 11.0 per cent reduction relative to the same period in 2014 and was due to a significant fall in receipts from sale of lands and capital grants.

Capital Expenditure Expenditure on transfer and subsidies was Spending on the Public Sector Investment reduced by 2.3 per cent to $108.0m.
This Programme (PSIP) for the first nine months was due to a decrease in the amount spent of 2015 amounted to $54.4m or 16.3 per on social welfare payments by 26.2 per cent cent lower than the $65.0m spent for the and training by 10.8 per cent.

Spending on same period in 2014.

Capital expenditure is goods and services contracted by 6.8 per affected by the continued slow 81 | P a g e ECONOMIC AND FINANCIAL DEVELOPMENTS implementation of the PSIP in 2015.
The Central government debt increased by 3.3 following are the major capital projects per cent from $1.25b in 2014 to $1.29b in undertaken which contributed to the amount 2015 while public corporations’ debt recorded above: increased by 4.7 per cent from $208.4m in • Rehabilitation of South Leeward 2014 to $218.3m in 2015.
Of the total Highway - $1.2m central government’s debt, the external • Rehabilitation of Vigie Highway - portion increased by 4.9 per cent while the $1.2m domestic portion increased by 0.9 per cent.
• Modern Medical Complex - $2.7m • Argyle International Airport - $31.0m • Regional Disaster Vulnerability Rehabilitation Programme - $3.0m • 10th EDF Modernisation of the Health Sector - $1.8m • Capital Subscription CDB/IBRD - $1.5m 2.3 Public Debt As at the end of September 2015, total public sector debt stood at $1.51b compared with $1.46b at the end of September 2014, an increase of 3.5 per cent.

Domestic debt increased by 2.6 per cent while external debt increased by 4.2 per cent.
Of the total debt, 57.2 per cent or $864.5m was held externally with the remaining 42.8 per cent or $646.7m held by domestic creditors.

Figure 2.5: Composition of Total Public Debt 2015 and 2014 Source: Ministry of Finance The debt owed by public corporations increased by 4.7 per cent from $208.4m to $218.3 in 2015. while the external portion decreased by 2.4 per cent the domestic component increased by 8.8 per cent.
The decrease in the external component can be attributable to the effects of amortisation which out paced disbursement.

Conversely the increase in the domestic portion is as a result of disbursement on new loans by the National Lotteries Authority and the National Student Loans Company from the 82 | P a g e ECONOMIC AND FINANCIAL DEVELOPMENTS National Insurance Services as well as September 2015.
The increase on external disbursements to the Arrowroot Industry debt servicing is on account of the Association from the Bank of St. Vincent commencement of the repayment on some and the Grenadines and the International loans including the Financial Stabilisation Airport Development Company from Petro Loan.

Conversely, domestic interest and Caribe.


As at the end of September 2015 disbursements on existing loans amounted to $30.0m compared with $52.7m during the same period in 2014, a decrease of 43.1 per cent.
The reduction can be attributable to the full disbursement in 2014 of most of loans relating to the construction and supply of equipment for the Argyle international airport as well as the slow disbursement rate on some existing projects including the Technical Vocational Education and Training Project and the Natural Disaster – Torrential Rainfall Project.
2.4 Debt Servicing During the period ending September 30 2015, central government external debt servicing increased by 5.7 per cent to $49.4m from $46.7m during the corresponding period in 2014.

Comparatively, the domestic component decreased by 5.5 per cent to $49.6m from $52.5m, resulting in a slight overall decrease of 1.0 per cent from $104.7m at the end of September 2014 to $103.6m at the end of amortization payments decreased by 7.5 per cent and 4.4 per cent respectively.
The slight decrease in the debt service resulted in a marginal improvement in the debt service indicator as a percent of revenue moving from 27.9 per cent at the end of September 2015 to 27.6 per cent in September 2015.

2.5 International Trade Merchandise trade Preliminary data show that merchandise trade fell by 11.1 per cent as at September 2015.
For the first three quarters of 2015, merchandise trade amounted to $728.7m, 11.1 per cent lower than the $809.5m recorded for the corresponding period in 2014.

The balance of trade also fell to a deficit of $548.0m, $68.1m lower than the 2014 amount.

This reduction was as a result of the decreases in imports as well as exports.

Although there was growth in domestic exports, this was not sufficient to offset the decline in re-exports thus causing the overall decline in exports.
83 | P a g e ECONOMIC AND FINANCIAL DEVELOPMENTS Merchandise imports Figure 2.6: Import composition by SITC Sections As at September 2015, merchandise imports continued the trend from the previous year.

Merchandise imports amounted to $638.4 m, a 10.4 per cent decline when compared with the corresponding period in 2014.

Of the major import categories, food and live animals was the only category which grew for the first three quarters of 2015 with a 1.0 per cent growth rate.
The declines in the other major categories, machinery and transport equipment (4.6%), manufactured goods (4.8%) and mineral fuels (46.1%) contributed to the overall decline in merchandise imports.

Food and live animals and machinery and transport equipment occupied the largest share of the import market as at the end of September, 2015.

These two categories accounted for 24.3 per cent and 20.0 per cent of total imports.
Two other important categories were manufactured goods classified chiefly by material and mineral fuels, lubricants and related materials which accounted for 17.5 per cent and 12.2 per cent, respectively.

(See figure 2.6) Source: Statistical Office, Ministry of Economic Planning, Sustainable Development etc The United States of America (USA) was the primary extra regional supplier of imports to St Vincent and the Grenadines.

Imports from the USA totalled $260.9m, accounting for 40.9 per cent of imports.
The second largest source of imports was from the CARICOM countries accounting for 22.2 per cent.

Within CARICOM, Trinidad and Tobago (68.1%), Barbados (12.5%) and Jamaica (7.1%) were the major suppliers.

The third and fourth largest suppliers of imports were the United Kingdom (UK) and China, with market shares of 7.4 per cent and 5.2 per cent, respectively.
84 | P a g e ECONOMIC AND FINANCIAL DEVELOPMENTS Figure 2.7: Composition of Import Markets Figure 2.8: Export composition by SITC Source: Statistical Office, Ministry of Economic Planning, Sustainable Development etc.
Source: Statistical Office, Ministry of Economic Planning, Sustainable Development etc Merchandise Exports During the first nine months of 2015, As at the end of the third quarter of 2015, merchandise exports amounted to $90.3 m, a 6.6 per cent reduction when compared with the corresponding amount of $96.7m which was recorded for the same period in 2014.

This outturn was on account of a 56.2 per cent reduction in re-exports which outpaced the 5.2 per cent growth in domestic exports.
CARICOM countries absorbed $81.8m or 90.6 per cent of Saint Vincent and the Grenadines’ exports.

Within CARICOM, Saint Lucia (19.3%), Barbados (18.9%) and Antigua and Barbuda (15.8%) absorbed the majority of the exports.

The second and third largest export markets were the USA and the UK, respectively.

Exports shipped to these two partners amounted to $3.1m or 3.4 Food and live animals accounted for the per cent and $2.1m or 2.3 per cent, majority of exports occupying 63.3 per cent respectively.
of the export composition as at September 2015.

Two other important export categories were beverages and tobacco and manufactured goods which accounted for 14.9 per cent and 10.8 per cent, respectively.

(See figure 2.8).

85 | P a g e ECONOMIC AND FINANCIAL DEVELOPMENTS Figure 2.9: Composition of Export Markets in private sector foreign currency deposits (48.8%) and private sector saving deposits (3.9%).
Increased inflows to a number of tourism-related companies were a major driver of the noticeable growth in private sector foreign currency deposit.

The growth in narrow money of 6.8 per cent was buoyed by increases in demand deposits, currency with the public and issued EC dollar cheques and drafts.

Domestic Credit Domestic credit expanded by 4.7 per cent largely attributable to a 32.0 per cent increase in net credit to central government.
This expansion in net credit to central government reflected increased drawdown on government’s deposit at commercial banks and the Central Bank.

A 1.6 per cent increase in private sector credit, which remained the major category, influenced this movement in domestic credit.

Meanwhile, the net deposits of non-financial public enterprises fell by 2.3 per cent largely resulting from decline in deposits.
Commercial Bank Credit by Economic Activity Total credit to the economic sectors grew moderately by 2.5 per cent for the review period.

An analysis of the distribution of 86 | P a g e Source: Statistical Office, Ministry of Economic Planning, Sustainable Development etc 2.6 Money and Credit Money and credit conditions in the domestic economy improved for the period January – September 2015.

Total monetary liabilities, domestic credit, net foreign assets and liquidity all grew relative to 2014.
However, the weighted average interest rate spread widened over the same period.

Money Supply Monetary liabilities (M2) increased by 6.0 per cent to $1.4b during the period January – September 2015 relative to a 6.9 per cent increase for the corresponding period in 2014.

This rate of expansion was occasioned by a 5.7 per cent increase in quasi money, accompanied by a 6.8 per cent growth in narrow money (M1).
Growth in quasi money, which accounts for approximately 71.3 per cent of M2, resulted from increases ECONOMIC AND FINANCIAL DEVELOPMENTS commercial bank credit by economic Net Foreign Assets Position activity reveals that loans disbursed stood at During the first nine months of 2015, the net $1.2b at the end of September 2015.
Further foreign assets of the commercial banking examination shows that credit extended for system stood at $486.0m, a decline 1.0 per personal use rose by 4.9 per cent from cent from the $489.2m recorded at the same $810.8m in September 2014, to $850.6m in period in 2014.

This performance was September 2015.

This largely reflected a 7.8 fuelled by a decline in the economy’s share per cent increase in outstanding credit for of foreign assets accumulated by the Eastern home construction and renovation.
Caribbean Central Bank (ECCB).

Meanwhile, loans disbursed to the major productive sectors declined by 15.8 per cent Liquidity and Commercial Interest rates in 2015 as a result of lower credit extended to the manufacturing sector, as commercial Liquidity in the commercial banking system institutions continued their risk aversion remained the same during 2015, relative to policies.
Credit to the agriculture and that of the period ending September 2014. fisheries sectors increased by 21.0 per cent The ratio of liquid assets to total deposits and 6.0 per cent, respectively.

Similarly, and liquid liabilities decrease to 42.0 per outstanding credit in the other sectors cent as at September 2015 from 43.0 per increased; entertainment (12.4%), cent as at October 2014, which is above the construction (10.2%), tourism (2.0%) and prudential ratio of 25.0 per cent.
This is government services (3.6%).

Conversely, consistent with the ratio of total loans to credit disbursed to manufacturing contracted total deposits (70.0%) which remained by 18.2 per cent.

There were also declines in unchanged over the period under review.

lending to transport (9.4%) and public While deposits increased by 3.0 per cent utilities (20.2%).

Credit to professional during 2015, the total number of loans services and financial institutions also increased by 3.0 per cent.
Correspondingly, declined, by 26.1 per cent and 32.0 per cent, the ratio of cash reserves to total deposits respectively.

Credit to distributive trade augmented by 1.0 per cent, from 21.0 per sector remained unchanged.

cent in 2014 to 22.0 per cent in 2015.

These ratios exceed the international standard with the exception of total loans and advance to 87 | P a g e ECONOMIC AND FINANCIAL DEVELOPMENTS total deposit which fell below the threshold the minimum savings rate to 2.0 per cent of 75.0 per cent.
with effect from May 2015.

Figure 2.10: Liquidity Ratios Figure 2.11: Weighted Average Interest Rates Source: Eastern Caribbean Central Bank (ECCB) Source: Eastern Caribbean Central Bank (ECCB) The weighted average interest rate spread widened in September 2015 to 7.3 percentage points from 6.8 percentage points in September 2014.
The average lending rate showed a slight decline, as it stood at 9.2 per cent in September 2015, moving from 9.3 per cent in September 2014, as financial institutions sought to improve the competitiveness of their loan products.

On the other hand, average interest rate on deposits moved from 2.6 per cent in 2014, to 1.9 per cent as at September 2015.

This was as a result of the implementation of the decision by the Monetary Council to lower 88 | P a g e THE REAL ECONOMY 3.
THE REAL ECONOMY 3.1 Agriculture The agricultural sector continues to be an important sector and plays an integral role in the growth and development of the domestic economy of St. Vincent and the Grenadines.

It is also a major contributor of foreign exchange earnings and is essential to food and nutritional security.

The sector is not without its challenges which include the constant threat of severe weather conditions and plant diseases such as the Black Sigatoka.
Amidst these challenges however, the sector continues to show resilience and tenacity.

Continued growth in the sector reflects government’s commitment in achieving its development thrust of reviving the agriculture sector.

During 2015 government continued to implement progammes and projects aimed at reviving the agricultural sector.

In the first nine months of 2015, several components of the Banana Accompany Measures (BAM), a $34.5m project financed by the EU, were ongoing.
Contracts were awarded to carry out the following activities: • A verification study, design and supervision of feeder roads.

• A value chain analysis for fruits, vegetables and livestock.

• The preparation of a business plan.

• Supply of dolomite limestone and calcium ammonium nitrate.

• Procurement to supply fisheries laboratory equipment.

These supplies were delivered in January 2016.


• Several training sessions in pig, ruminant and poultry production took place from June to September 2015 and included Animal Welfare, Pasture Management for Ruminants and Nutrition for Pigs and Poultry.

• Supply and delivery of climatological stations.

• Animal identification material and supplies along with training in the use of the equipment were delivered to the Ministry of Agriculture.
Crops For the period January to June, 2015, the production of crops continued its positive growth path as it did in 2014.

Following four years of consecutive growth preliminary data show crop production grew 89 | P a g e THE REAL ECONOMY by 21.0 percent to 33.4m lbs over the 27.5m Figure 3.1: Composition of other crops lbs in 2014.
Bananas Following the effects of the floods in 2013 and the ongoing problem of plant diseases such as Black Sigatoka over the past few years which negatively affected the banana industry, activity in the banana industry continues to improve.

Preliminary figures for January to June 2015 estimate that Source: Ministry of Agriculture, Forestry and Fisheries banana production increased.
Exports of 3.2 Fishing bananas for the review period remained virtually unchanged with 1,969 tonnes exported in 2015 compared with 1,971 tonnes in 2014.

Other Crops Government’s efforts towards diversifying the agriculture sector around ‘bananas’, continued and output of other crops grew for the seventh consecutive year in 2015.

Preliminary data for the first six months of 2015 show that production expanded by 21.0 per cent in 2015.
A yield of 40.3 m lbs was realized in 2015 compared with 33.4m lbs for the comparative period in 2014.

Crop produced included dasheen (17.1%), plantains (13.5%), eddoes (10.9%), sweet potatoes (9.2%) and tannias (1.7%).

Government’s commitment to revive the fishing sector continued to bear positive results in 2015.
There was growth in the fishing sector for the period January to September 2015 as preliminary data for the period revealed an increase in fish landings to 1.4m lbs at a value of $8.5m compared with 1.2m lbs valued at $7.3m for the corresponding period in 2014.

The main species recorded in volume were robin (17.1%), dolphin (12.4%), jacks (12.4%), balahoo (11.9%), whale (7.8), skipjacks (5.1%) and conch (4.6 %) see figure 3.2.
90 | P a g e THE REAL ECONOMY Figure 3.2: Composition of Fish Landings light manufacturing, the production of PVC pipes and galvanise sheets grew by 84.3 per cent and 29.9 per cent, respectively while packaging output contracted by 5.4 per cent.
Figure 3.3: Output Volume of main Manufactured Items Source: Ministry of Agriculture, Forestry and Fishing 3.3 Manufacturing For the first nine months of 2015, the manufacturing sector is estimated to have Source: Statistical Office, Ministry of Economic Planning, Sustainable Development etc expanded.

This is on account of increases in There was a reduction in commercial bank the production of galvanise sheets and credit extended to the manufacturing sector.
beverages which grew by 29.9 per cent and As at September 2015, $26.3m was 13.6 per cent, respectively.

Regional disbursed to manufacturers, down 18.3 per markets fuelled growth in alcoholic cent relative to the corresponding period in beverages (20.7%) which outpaced the 2014.

This was as a result in the reduction in decline in non-alcoholic beverages (1.5%), loans disbursed for the production of food thus resulting in the increase in the output of and non-alcoholic beverages (76.8%) and beverages.
During the period, the output of flour and animal feed declined by 1.0 per cent and 8.8 per cent, respectively.

This outturn was as a result of regional competition for the production of these items.

With regards to other industries (16.8%).


During the review period, $5.5m of loans disbursed for manufacturing was allocated to the production of alcoholic beverages and tobacco, $1.4m to food and non-alcoholic 91 | P a g e THE REAL ECONOMY beverages and $0.8m to clothing and quarters of 2015, as a result of completion of accessories.

some projects.

Figure 3.4: Credit to the Manufacturing Sector Figure 3.5: Activity in the Construction Sector Source: Statistical Office, Ministry of.
Economic Planning, Sustainable Development etc Source: Statistical Office, Ministry of Economic Planning, Sustainable Development etc 3.4 Construction During 2015, the government embarked on a housing rehabilitation and reconstruction project, for persons affected by the trough Activity in the construction sector remained system in December 2013.

This project is flat for the first nine months of 2015, aimed towards reducing poverty and compared with the corresponding period in promoting social development.
To date 198 2014.

Preliminary estimates indicate a 0.4 projects were undertaken with 91 currently per cent decrease in construction activities ongoing at various stages of completion.

from, $122.2m for January to September Residential outlays towards construction 2014 to $121.7m for the same period of increased during 2015.

In this vein, 2015.
In this vein, 2015.

While work continues on the Argyle commercial bank credit towards the International Airport and the South Leeward construction sector increased by 10.2 per Highway, these outlays buoyed activities in cent for the period January to September the sector during 2015.

Meanwhile, a 2015, compared with the corresponding number of public sector construction period of 2014.

These outlays moved from activities slowed down during the first three $22.3m to $24.6m.
Similarly, the imports of construction materials increased by 0.04 per 92 | P a g e THE REAL ECONOMY cent for the January to September period, as an income generating sector.

The from $99.9m 2014 to $100.0m in 2015 Government of St. Vincent and the Meanwhile, construction permits increase by 24.9 per cent for January to September 2015, compared with the corresponding period of 2014 (See figure 3.6).

In the same period, construction permits for new residence increased by 24.9 per cent.
Likewise, permits for new commercial construction also increased, from 13 permits in the 2014 to 15 in 2015.

Further, permits Grenadines continues to allocate the necessary resources to ensure that tourism is well placed to drive the economy.

The construction of the international airport at Argyle is the country’s largest investment in the sector to date, and it is hoped that this venture would open opportunities for the private sector and enable the tourism sector to grow.
for additions increased 22.2 per cent.

In a For the period January to September 2015, similar vein, permits for other forms of there was a marginal decrease of 0.5 per construction increased from 20 in the cent in total visitor arrivals, compared with January to September period in 2014, to 28 the 0.5 per cent increase registered in the in the corresponding period of 2014. corresponding period in 2014.
In 2015, total Figure 3.6: Construction permits issued January to September 2011-2015 Source: Ministry of Housing, Informal Human Settlements, Lands and Surveys and Physical Planning visitor arrivals fell to 145,680 from 146,365 in 2014.

This overall decline was reflected in all of the categories with the exception of stay-overs.

Visitors by air which accounted for 37.1 per cent of total visitors increased by 3.2 per cent, while, visitors by sea fell by 2.7 per cent.
Stay-over visitors representing the largest category of visitors (37.6%), increased by 4.0 per cent relative to a 2.7 per cent reduction recorded in the previous year.

Same day, cruise and yacht visitors declined by 19.7 per cent, 4.0 per cent and 0.7 per 3.5 Tourism (Hotels & Restaurants) cent, respectively.
The creation of employment and the receipt of foreign exchange earnings propel tourism Stay-over visitors 93 | P a g e THE REAL ECONOMY For the period January to September 2015, Cruise Visitors stay-over visitors amounted to 54,759, growing by 4.0 per cent when compared with reductions in the past two years of 1.7 per cent and 4.9 per cent, respectively.
This increase in stay-over visitors is on account of increases in all major source markets, USA (7.6%), United Kingdom (6.7%), Canada (3.1%) and the Caribbean (5.9%).

Cruise visitors, accounting for the second largest category of visitors, declined by 4.0 per cent by the end of September 2015 relative to a marginal increase of 0.1 per cent in the previous year.
This outturn was as a result of a 59.4 percent reduction in cruise visitors to port Bequia which outpaced the increases recorded at the other Figure 3.7: Stay- Over visitors by major markets three (3) ports of entry, Kingstown (8.0%), Canouan (7.8%) and Union Island (34.4%).

Cruise ship calls for the period decreased by three to 157 calls for the first nine months in 2015.
(See annex 12) Yacht Visitors At the end of the third quarter of 2015, yacht visitors amounted to 35,977, a marginal decrease of 0.7 per cent when compared with increases of 6.1 per cent and 0.5 per cent for the same periods in 2014 and 2013, respectively.
This decrease in yacht visitors Source: St. Vincent and the Grenadines Tourism Authority Same day visitors Same day visitors continued on its resulted from the decline of 1.2 per cent downward trend for the first nine months of recorded at port Bequia which accounted for 2015 albeit at a slower rate of 19.7 per cent the majority of yacht visitors (57.9%).
when compared with the 25.5 per cent Decreases were also recorded at ports recorded for the corresponding period in Canouan (43.7%), Mustique (38.7%) and 2014.

This category accounts for less than Walliabou (10.9%).

For the review period, one per cent of total visitor arrivals to the most yacht visitors visited in the month of country’s shore.

January (6,909).
January (6,909).

(See annex 13) 94 | P a g e THE REAL ECONOMY 3.6 Financial Sector International Financial Services supported by the Caribbean Development Bank (CDB) is scheduled to commence operation by early 2016.

This enhanced system will facilitate online registration and Despite the challenges being faced in the effective monitoring of current clients to global economic environment, the ensure that fees are collected in a timely International Financial Services (IFS) sector manner.
continues to make an important contribution to the national economy.

Fee income earned The Financial Service Authority (FSA) of $2.9m declined by 2.8 per cent over the continues to take advantage of new period January to September 2015 compared opportunities for business, through efforts with the same period for 2014.

This with the Registered Agents and industry movement was mainly as a result of lower partnerships.
The IFS sector has benefitted fees collected from IBCs (6.7%), registered significantly from the marketing initiatives agents (5.4%) and domestic insurances undertaken by three (3) Registered Agents in (7.1%).

These declines in fee income were promoting the industry.

attributable to increased cancellation and The Government of St Vincent and the decline in renewals.
Increased fee receipts Grenadines has made significant progress in were recorded for International Trusts enhancing regulatory oversight and (16.6%), International Banks (43.1%) and operations over the past few years.

Mutual Funds (5.3 %).


However, it is mindful that regulatory development must be accompanied and Past performances have denoted that complemented by, inter alia, effective confidence in the IFS products and services marketing initiatives to efficaciously tap into has been maintained and it is expected to be the large potential of this sector.

As such, enhanced by an upgraded IT system.


In the focus for 2016 will be on: order for the sustainability of the • Enhancing strategic partnerships International Financial Services (IFS) the particularly with Invest SVG to current mode of operation must be re- ensure effective marketing of engineered in relation to marketing and the products and services; IT system.
An enhanced IT infrastructure 95 | P a g e THE REAL ECONOMY • Developing IT and MIS capabilities – September, twenty-eight (28) Forfeiture for registry and regulatory Orders were granted in 2015 compared with application; fifteen (15) in 2014.
There was one (1) • Ensuring an effective legislative and money laundering prosecution in 2015; regulatory framework for the meanwhile no Confiscation Order was international and non- bank sectors; obtained during 2015, however, one (1) and Confiscation Application was made for the • Enhancing compliance with required same period under review.

international initiatives.


Financial Intelligence Services For the period January – September 2015, the Financial Intelligence Unit (FIU) collected and analysed approximately three Despite the challenges and constraints the FIU continues to ensure that all staff members are adequately trained.

The Unit continues to maintain excellent cooperation with its local, regional and international counterparts as well as local stakeholders.
hundred and sixty four (364) Suspicious The work of the FIU in making the Activity Reports (SARs), compared with six environment hostile for money launderers hundred and seventy four (674) in 2014. and terrorist financiers is ongoing and These SARs were filed by Service Providers includes the following measures: as set out in the First Schedule of the Anti- Laundering and Terrorist Financing Regulations, 2014.
This exhibits the ongoing commitment of the relevant stakeholders to play their part in combating the scourge of money laundering and safeguarding our • Ongoing collection and analysis of SARs; • Uploading all SARs electronically to facilitate easier record-keeping and cross referencing; financial systems from proceeds which are • Greater allocation of human generated from illegitimate means and resources to the analysis of SARs; recognition by these institutions of the pivotal role played by the FIU.
The amount of monies detained doubled in • Ongoing quality financial investigations to obtaining successful money laundering convictions and 2015 over 2014.
During the period January confiscation/forfeiture of assets; 96 | P a g e THE REAL ECONOMY • Training and awareness with the financial institutions, regulated businesses and other stakeholders in the fight against money laundering and terrorist financing; • Increase cooperation with local, regional and international agencies and • Amendment of legislation to introduce new measure, strengthen existing ones and clarify any existing ambiguities.

97 | P a g e PUBLIC INFRASTRUCTURE 4.


PUBLIC INFRASTRUCTURE 4.1 Public Utility 4.1.1 Energy Average crude oil price continued along a downward trajectory in 2015.

Brent crude oil price, the global benchmark, averaged US$47.62 per barrel in September 2015, down 51.0 per cent from the average in September 2014 (US$97.09 per barrel).

This outturn comes on the back of rising global oil inventories, associated with robust growth in world crude oil supply.
It is forecasted that global oil inventories will continue to rise over the next year, keeping downward pressure on oil prices1.

Increased crude oil production in Saudi Arabia and Iraq is the main driver of higher oil inventories in OPEC countries.

1 U.S Energy Information Agency Short-Term Energy Outlook (STEO).
http://www.eia.gov/forecasts/steo/pdf/steo_full.pdf Figure 4.1: Brent Crude Oil Prices (Oct 2014- Sept 2015) Source: U.S Energy Information Agency Domestic Developments Work to develop the energy sector in St. Vincent and the Grenadines continued in 2015 with a number of initiatives geared towards a sustainable supply and use of energy, including increased utilization of renewable energy technologies and efficient and cost-effective transportation.
Notable among these was the Geothermal Development Project, a joint venture between the Government of St. Vincent and the Grenadines, Icelandic company Reykjavik Geothermal, Clinton Climate Initiative and state-owned electricity company VINLEC.

In August 2015 the SVG Geothermal Resources Development Bill was passed, which seeks to provide for the development and use of geothermal resources and other related matters.
During 98 | P a g e PUBLIC INFRASTRUCTURE the period, the government negotiated a result of increased consumption by domestic US$15m concessionary loan from the users (3.6%) the largest category of International Renewable Energy Agency consumers, and commercial users (1.9%).

(IRENA) through the Abu Dhabi Fund for Consumption by VINLEC declined by 6.3 Development.

This, along with monies per cent over the comparative period.
pledged through the Caribbean Development Figure 4.2: Electricity consumption 2014-2015 (Jan- Bank (CDB) and Inter-American Sept) Development Bank (IDB) will assist the government in developing the geothermal resources in the country.

Government is also pursuing initiatives to reduce greenhouse gas and support cleaner energy solutions.
Through the PACES project (Promoting Access to Clean Energy Services); the Government of St. Vincent and the Grenadines in collaboration with two private entities will procure one fully- electric and 2 hybrid vehicles for demonstration purposes.

Equipment for a solar charging station has already been procured.

Plans are also in place to install 50 kWp and 65 kWp PV cells at the Belle Isle Correctional Facility and the Argyle International Airport respectively as part of this project.
4.1.2 Electricity Electricity consumption for the first three quarters in 2015 increased slightly to 101.4 GWh over the corresponding period in 2014 (98.7 GWh).

This performance was the net Source: St Vincent Electricity Services Ltd Importation of Commercial Fuel During the review period, the importation of commercial fuel fell by 24.7 per cent.

This was mostly on account of a decline in the importation of diesel (30.3 %).
The volume of imported gasoline also declined (21.9 %), while liquefied petroleum gasoline (LPG) which accounts for 8 per cent of fuel imports, increased by 31.5 per cent.

99 | P a g e PUBLIC INFRASTRUCTURE Figure 4.3: Importation of fuel 2014-2015 (Jan-Sept) • The construction of Belle Isle water storage tank.

• The rehabilitation and upgrade of the first segment of Dalaway transmission main.
• Investments in information and communication technology through the continuation of the implementation of Geographic Information System (GIS) mapping to aid both engineering and customer service departments.

• The completion of Phase I of the e- bill view and e-billing project.
• Installation of pipeline mains at the Argyle International Airport The CWSA in 2015 increased its total number of connections to 39,500 and will continue to reduce the number of communal facilities and standpipes by providing free water connections to indigent customers all in an effort to promote improved public health.
In 2016, the CWSA will continue to embark on further important expansion and improvement projects in both the water and solid waste sectors; most notably: • The replacement of vehicles and meters.

100 | P a g e Source: Statistical Office, Ministry of Economic Planning, Sustainable Development etc 4.1.3 Water and Solid Waste Activity in the water and solid waste sectors improved marginally in 2015.
Water production for the first nine months of 2015 amounted to 1.5b gallons, compared with 1.4b gallons over the same period in 2014.

The CWSA’s financial performance for 2015 is also expected to show an improvement over the performance for the previous year.

During the 2015, several important capital investments were completed.

These included: • The installation and commissioning of the new Mamoon Treatment Plant.

• The replacement of another compactor collection truck.
PUBLIC INFRASTRUCTURE • A further upgrade of the existing SCADA system.

• Implementing another phase of the Grenadines Solid Waste Management Project including land acquisition on Union Island and the finalization and approval of design plans of the Developers on Canouan.

• Upgrade of a section of the transmission main at Montreal.

• Completion of the storage tank at Belle Isle on the Hermitage system.

• Completion of the final phase of the pipeline installation at the Argyle Airport.
• Increased specialized training for staff in key technological areas.

The CWSA will also continue to work with various Government ministries and agencies in ensuring that all citizens in every community have access to a pipe-borne water supply.

101 | P a g e SOCIAL SECTOR 5.


SOCIAL SECTOR 5.1 Education The year 2015 marked the second year that Education continues to be vital in assisting the Ministry successfully implemented the the reduction of poverty and increasing the Caribbean Primary Exit Assessment overall quality of life for Vincentians and (CPEA).

Over eighty per cent (80.9%) of hence plays an integral role in national the students met the prescribed standard, an development and nation building.
During increase in performance over the previous 2015, the Government, through the Ministry year’s results of 78.1 percent.

The highest of Education continued its focus on average score recorded in this year’s exam improving the quality of education services was 96.8per cent.

provided to all Vincentians.

Early Childhood Education A total of 1,822 students wrote the CPEA exam (918 males and 904 females) (see Preliminary data showed that enrolment for figure 5.1).
The total number of students the 2015/2016 school year was 3,342 who obtained passing grades was 1,474, students, comprising of 1,683 males and comprising 673 males and 801 females.

Figure 5.1: Number of CPEA passes by sex 1,659 females.

This shows an increase of 266 (8.4%) students over the 2014/2015 period where 3,076 students were enrolled (1,571 males and 1,505 females).

Primary Education The Ministry of Education recorded enrollment of 13,363 students for primary schools as at September 2015/2016.
Males continue to outnumber females with 6,836 males and 6,527 females.

This indicates a Source: Ministry of Education considerable increase in the primary level of 933 (7.5%) students over the 2014/2015 of 12,430 (6,341 males and 6,089 females).
102 | P a g e SOCIAL SECTOR Figure 5.2: Overall Pass Rate, CPEA 2015 Figure 5.3: CSEC pass rate for the period 2006-2015 Source: Ministry of Education etc Secondary Education Source: Ministry of Education For the 2015/2016 academic year, Tertiary Education preliminary data indicate that student A total of 2,382 students were enrolled at enrolment stood at 10,286, (5,275 males and the St. Vincent and the Grenadines 5,011 females) compared with 10,192 Community College (SVGCC) for the enrolled in the 2014/2015 school year (5,227 2015/2016 school year, comprising 2,151 males and 4,965 females).
fulltime and 221 part-time students.

The There was an improvement in the performance of students in the Caribbean Secondary Education Certificate (CSEC) Examination in 2015.

The overall pass rate was 75.2 per cent in 2015, compared with 71.2 per cent in 2014.

Division of Arts, Sciences and General Studies (DASGS) had the highest enrolment with 1,281 students in 2015/2016, compared with 1,007 for the 2014/2015 school year.
Six hundred and seventy-five (675) students were enrolled at the Division of Technical and Vocational Education, compared with 785 for the corresponding period in 2014/2015, while 224 students were enrolled at the Division of Teacher Education for the period 2015/2016 compared with 159 in the 2014/2015 period.

Enrolment at the Division of Nursing Education for 2015/2016 was 103 | P a g e SOCIAL SECTOR 202 compared with 229 students for the Ecuador, hosted forty-four (44) Ecuadorian 2014/2015 period.
teachers to pursue a seven (7) month In June 2015, the SVGCC had its largest graduation to date with 837 graduates, compared with 743 in 2014.

Included in this figure were 37 students who completed the Bachelor in Nursing Programme on Franchise from the University of Technology, Jamaica and 21 students who completed the Bachelor in Social Work franchised from the Jamaica Theological Seminary.
In the summer of 2015, the SVGCC, in partnership with the Basic Needs Trust Fund, (BNTF) and the Caribbean Development Bank (CDB) conducted six weeks of skills training for 68 unemployed and part-time employed young people in the areas of electrical installation, small engines repair, air conditioning and refrigeration programme in English as a second language.
Further private sector partnership continues to be strengthened with the Division of Technical and Vocational Education through hospitality attachments at the Crane Resort, Barbados for the third year.

Also there were workplace attachments for all final year students.

The St. Vincent and the Grenadines Community College continued on its path towards accreditation.

In January 2015 an Accreditation and Quality Assurance Officer was assigned to the college.
In September the National Accreditation Board made a series of quality assurance visits to different campuses and held meetings with the Board of Governors, staff and faculty at all levels.

technology.

At the end of the training St. Vincent and the Grenadines now has four programme, participants received a set of (4) off-shore medical colleges’ local tools necessary for their particular campuses with a total of 922 students.

These disciplines.
These disciplines.

The SVGCC in partnership with the Ministries of Foreign Affairs and Education, Tourism Authority, UWI Cave Hill and Open Campus, Dominica State College and the Ministry of Higher Education in colleges cater primarily for foreign students; however, a few Vincentian students are enrolled at some of these campuses.
Currently a total of 218 students are enrolled at the Trinity Medical College, 230 students are enrolled at the Saint James School of Medicine, and 131 students are enrolled at 104 | P a g e SOCIAL SECTOR the American University of St. Vincent and also held with teachers and moderators of the Grenadines and 343 students at the All CSEC Sciences.

Saints Medical School.


Examinations and Assessment Unit The annual National Awards Ceremony was held in April 2015 and awards were presented to students for their outstanding Assessment is an important part of the performance at CSEC and CPEA.

teaching and learning process.

The Examinations and Assessment Unit’s mandate is to generate tests and interpret data about students’ learning in order to: • Promote the understanding and improvement of teaching and learning.
National Accreditation Unit The Accreditation Unit has maintained its thrust to provide an efficient service to the public.

It has been able to do so by providing several services.

During the period the following activities were • Facilitate the evaluation of accomplished: institutional effectiveness.

• Inform curriculum development and implementation.

All local examinations were successfully administered.
The external examining bodies (CXC – CSEC & CAPE, University of London and University of Cambridge) offered examinations twice throughout the year.

The unit registered candidates for these examinations, managed and executed the logistics related to the preparation and conduct of the examinations.

Practical and internal assessments were also coordinated for reporting to the examination bodies.
Workshops related to the CXC syllabi were • The Accreditation Unit engaged fourteen (14) institutions/ establishments through visits and or consultations.

Five of these were new entities expressing their interest in becoming new providers.

• The Bethel Bible College formerly the St. Vincent and the Grenadines Theological College was registered.

This brings the total number of registered institutions to seven (7).
• The National Accreditation Board and the Accreditation Unit began the Self-study process with several institutions in May 2015.

There were thirty two (32) persons 105 | P a g e SOCIAL SECTOR representing seven institutions.

The During the year in review the Department of unit was also engaged in the Libraries continued to foster a love of verification of certificates for 426 reading and learning through it programmes clients.
relating to home work clubs, book clubs, .National Qualifications Department remedial reading programmes and story time The National Qualification Department (NQD) undertook the following activities and programmes during 2015: • Training of instructor/assessors in the modalities of Prior Learning Assessment and Recognition (PLAR) was conducted in June, 2015.

• TVET instructors from four technical institutes conducted a two-day CBET workshop in March 2015.
• The ANEW program and the Pre- Technology program were implemented in September 2015 to provide vocational training for unemployed/Out-of-School/“At Risk” youths and adults.

• An evaluation of the Sector Skills Development Agency (SSDA) / National Qualifications Department (NQD) was conducted by CARICOM/CANTA in September 2014 and February 2015.

Department of Libraries and National Archives sessions.
There are monthly thematic displays in the adult and reference library, at the National Archives along with expression boards in the children’s library.

Primary and pre-schools around the country are taking advantage of a more organized children’s library by requesting tours, information and literacy services from the department.

During 2015, the department received 25,000 juvenile books from the Global Literacy Project and 100 hundred boxes of books from Martha’s Vineyard as donation.
School Inspection and Supervision Unit During the year, the Unit provided professional development assistance to a number of schools in districts 1, 3 and 4 in the areas of curriculum planning, literacy development and strategies for school improvement.

During the school year, the Unit carried out full inspections of seven primary schools and three secondary schools.
Overall, two of these primary schools were found to be 106 | P a g e SOCIAL SECTOR providing a satisfactory standard of 5.2 Health education to the majority of the pupils, while the five remaining ones need to make a The goals, objectives and interventions number of improvements to attain a contemplated by the national health sector satisfactory level of performance.
The three are aligned with the priorities for the secondary schools however, need to improve modernization of the national health sector their overall delivery of education to the and environmental sustainability, as students that the currently serve.

enunciated in the National Economic and The Unit has made a number of recommendations of measures that individual schools need to put into place to bring about improvement in the effective delivery of a holistic education to their stakeholders.
Social Development Plan 2013-2025.

St. Vincent and the Grenadines has achieved and surpassed many of the Millennium Development Goals for health, most notably in the areas of maternal and child health, prevention of HIV infection, and mortality due to injuries.

Marked improvement has also been demonstrated among important The Unit requested that each school provide economic, social and environmental an action plan.
During the year, five schools determinants of health including in the submitted plans of action on how they human development index, accessibility to intend to improve the delivery of education potable pipe-borne water and accessibility of and the overall functioning of the school.

solid waste management services in rural The Unit also carried out follow-up communities.

inspection activities at eight schools.


Five of Meanwhile many new and emerging these schools have shown improvement in challenges to health are in evidence.

their overall functioning and in the Foremost among these challenges are: performance of students and teachers.

• Emerging and re-emerging communicable diseases which continue as one of the five leading causes of death.
107 | P a g e SOCIAL SECTOR • Neonatal mortality which remains Mental Health Centre is being above the World Health renovated and is in its final stages.

Organization’s recommended level.

This facility is scheduled for re- • Improving the mental health and opening during the first quarter of wellness services.

2016.

Further, two polyclinics, one at • Geriatric health services to address Buccament and the other at the ageing population.
Marriaqua, are being constructed to • Establishing a sustainable financing support the delivery of health care.

mechanism, including National 2.

Under the Basic Needs Trust Fund Health Insurance and public-private- programme, supported by the partnerships.

Caribbean Development Bank, the • Reducing the impact of climate Bequia Hospital in Port Elizabeth change on health through the was rebuilt.

This, along with the introduction of sustainable Paget Farm Health Centre will environmental health policies.
provide health care for the island of During the period under review, work on Bequia.

The refurbished facility health infrastructure continued to be a major which was re-opened in October focus, with several renovations/expansions 2015, was expanded to include four being realised and new facilities being main wards.

constructed.

3.

The Modern Medical Complex, 1.

Under the 10th EDF project, the renovation of the Milton Cato Memorial Hospital continued.
Improvements are being made to the operating theatres, the female surgical ward, the kitchen, the physiotherapy area, the conference room, as well as the maternity ward.

Works on this facility are expected to be completed in early 2016.

Also the 10th EDF project under the initiated approximately eight years ago, is also in its final stages of completion.

Originally conceptualized as a dialysis centre, it has since evolved and will, on completion, boast a full medical diagnostic centre.
It will along with the Georgetown Smart Hospital and the Georgetown Health Centre provide care at the primary, secondary and tertiary levels.

108 | P a g e SOCIAL SECTOR Non-Communicable Diseases The Ministry of Health, Wellness and the Non-communicable diseases (NCDs) including cardiovascular disease, diabetes, asthma and other chronic respiratory conditions, and cancers are the leading causes of death worldwide.

The statistics show that this is an urgent global health issue that demands urgent response.
In St. Vincent and the Grenadines, NCDs are the leading cause of mortality and morbidity.

Cancers, diabetes, hypertension and heart diseases are some of the diseases that are of significant public health concerns.

Over the past five years, the monitoring and evaluation reports of the national health sector showed that these diseases occupied the top causes of mortality in the country.
The Government of St. Vincent and the Grenadines, through the Ministry of Health, Wellness and the Environment, has recognized that the prevalence of NCDs and its risk factors in St. Vincent and the Grenadines have risen substantially in the past decades.

The ministry has responded by implementing a range of measures in order to tackle these diseases and to reduce the risk factors, thus aiming to decrease premature mortality and increase the quality of lives of people who suffer from these diseases.
Environment now has an officer whose mandate is to spearhead the management and control of NCDs.

A National Strategic Plan for Non-Communicable Diseases (NSP-NCD) and a comprehensive NCD work plan are in the final stages of development with the assistance of the Pan American Health Organization (PAHO).

The development of these two important documents serves as a road map and a systematic organized plan to respond to this epidemic.
These plans were informed by the recently completed WHO STEPS Survey (National Health and Nutrition Survey).

The survey examined the major risk factors and the status for these diseases.

Results of the survey showed that approximately 30.0 per cent of Vincentians have 3 to 5 combined risk factors associated with NCDs.

Emerging Infectious Disease Threats The spectrum of infectious disease is changing rapidly, in collaboration with dramatic societal and environmental changes.
The recent examples of emerging infectious diseases include the Chikungunya outbreak of 2014, the presence of Zika virus in the region, and the Ebola Virus outbreak of 2014.

These diseases as well as resurgent diseases (e.g., tuberculosis and cholera) 109 | P a g e SOCIAL SECTOR illustrate human vulnerability to epidemiological profile, there is a great need microorganisms in the environment.
The to extend basic nutrition screening and Ministry of Health, Wellness and the nutrition intake monitoring to older children Environment continues to put plans in place and adolescents (aged 5 to 17 years) based to strengthen surveillance for communicable in schools.

diseases and to improve the response time to prevent the spread of these diseases.

St. Vincent and the Grenadines has made significant strides with the response to HIV/AIDS.
However, the epidemic has moved from a generalized epidemic to one that is mostly concentrated in key populations.

Efforts to improve prevention of HIV/AIDS and care for clients in 2015 Environmental Management St Vincent and the Grenadines has surpassed its obligation under the Montreal Protocol to phase-out ozone depleting substances.

We are four (4) years ahead of the scheduled phase out plan and the consumption of ozone depleting substances has been reduced by 67.7%.
were faced with a number of challenges.

As party to the UN Framework Convention One such challenge has been the decrease in on Climate Change, several climate change funding from donor agencies.

projects are being implemented currently.

Nutrition These include the Reducing Risk to Human and National Assets from Climate Change In 2015, of 6,157 children 0-59 months (RRACC) Project and the GCCA Project on screened 109 were obese and 50 were Climate Change Adaptation and Sustainable overweight.
While the incidence of both Land Management.

Under these projects, under nutrition (wasting, stunting) and rainwater harvesting systems were installed overweight/obesity was below 5 percent, the in various schools in St. Vincent and the real problem of overweight/obesity may be storage capacity and distribution system of in the older preschool children aged 25 to 59 the desalination plant in Pagent Farm Bequia months where clinic attendance is lower and upgraded.
These measures were aimed at the status of non-attendees is unknown.

increasing accessibility of water in Given the high incidence rates of nutrition- related CNCDs in adults reported in the vulnerable areas and increasing resilience to climate change.

110 | P a g e SOCIAL SECTOR 5.3 Social Development use to support parents for the purchase of During the period under review concerted efforts was placed on poverty reduction and a number of conditional cash transfer programmes.
The investment in the social sector remains pivotal to the prevention and alleviation of poverty in St. Vincent and the Grenadines.

In 2008, the Country Poverty Assessment (CPA) revealed poverty to be present in approximately 30.2 per cent of the population with 2.9 per cent living below the poverty line.

Additionally, there remains an additional 18.0 per cent of the population who are vulnerable or at risk to fall into poverty in the face of an economic shock or natural hazard.
Government has identified a number of non-income issues which affects individuals and efforts are being undertaken to adopt the multidimensional measurement of poverty to examine the levels of deprivation that impacts individuals and their families.

One notable poverty reduction initiative is the school cooperative thrift programme which encouraged students to save.
During the year under review, a total of 11,583 students from 87 schools both at the primary and secondary levels were able to save a total of $0.9m.

This investment can later be school supplies and other necessities during the school year.

Despite considerable social investment since the poverty assessment in 2008, unemployment continues to challenge the development efforts.

In 2012, the Housing and Population Census recorded 21.5 per cent of the population being unemployed.
In an effort to contain the unemployment situation especially among the youth population, the government investment was focused mainly in two programmes to improve human development; the Support for Education and Training (SET) and Youth Employment Services (YES).

During the review period the government spending for these two programmes approximated to $4.2m.

This effort lays the broader foundation for future economic development.

.
.

Social Security In the area of social security, the National Insurance Services (NIS) remains the main institution to address the multidimensional nature of poverty in the provision of various benefits, such as maternity, disability 111 | P a g e SOCIAL SECTOR unemployment, survivors’ benefits, funeral the significant challenges facing the grants, and old-age pensions.
St. Vincent organization are as follows: and the Grenadines continues to experience (a) Population ageing and falling significant demographic changes on the age fertility rates which adversely structure of the population, as improved impacts the ratio of pensioners to standard of living has promoted longer life contributors.

expectancy.
expectancy.

In 2012, the household (b) Emigration of working age persons population stood at 109,188 inhabitants, which negatively erodes the 17.3 per cent of whom are over the age of contribution base.

54.

This ageing population along with the (c) Fragile and volatile economic increase in the number of pensioners present conditions which negatively impacts an unprecedented challenge to the economy, employment rates.
as only 49.6 of the working age population (d) Low coverage rate for self- are employed, indicating a high economic employed and informal workers.

dependency ratio.

(e) Limited suitable investment opportunities in the local and During the period under review the NIS did regional financial markets.

not identify any shocks that had material (f) The low interest rate environment as impact on its financial and actuarial punctuated by the lowering of the performances.
Some of the major initiatives minimum savings deposit rate by that were implemented during 2015 were the ECCU Council from 3.0 per cent to establishment of a new service centre in 2.0 per cent.

Bequia, the rebranding of the customer service department and the hosting of a Despite the weak national and international pensioners appreciation day.
macro- economic conditions the NIS continues to revise and design strategies to As social security providers, the NIS faces a preserve and propel the long term myriad of risks and challenges in providing development.

These include the completion sustainable social protection for the people of the first of the six phase investment in of St. Vincent and the Grenadines.

Some of real estates of lands at Peter’s Hope in April 2015 at a total cost of $1.3m.
Additional 112 | P a g e SOCIAL SECTOR investments include the rehabilitation of a continuance of the YES programmes and property at Richmond Hill at approximately other subsidy and transfer programmes.

0.4m.

Social vulnerability These and other programme directly impacts on poor individuals and households.

Other investments were realize to protect During the period under review the country particular groups; children, youth and made substantial effort to increase the elderly.
These programmes were also opportunities to the population to prevent conditioned to address gender related issues.

persons from falling into poverty.

The guiding principle behind the Investments were realized in the following programmes is to respond to the management of social risk that exposes individuals to vulnerability.

Marked investment to the tune of $1.2m were expended in the area child protection in the areas of transportation to school, school fees, medical fees, uniforms, rent and meals.
areas: • Social protection • Child development • Youth development • Gender development • Family and community development • Policy development and administration • Housing In the area of social protection, 5,030 families comprising of 14,144 individuals benefited from a total investment of $11.4m.

This accounted for 65.0 per cent of the 2015 social welfare budgetary allocations.
Thus measures were introduced to increase spending in the areas of pro- employment such as the SET and the 113 | P a g e PUBLIC SECTOR INVESTMENT PROGRAMME 6.

PUBLIC SECTOR INVESTMENT PROGRAMME 6.1 Introduction The Public Sector Investment Programme (PSIP) is an important development tool which reflects the strategic direction of the economy of St. Vincent and the Grenadines.
It outlines the government’s investment priorities, and comprises projects and programmes that are designed to enhance capital formation, promote competitiveness, and stimulate economic growth and development in the face of an increasingly challenging external environment.

The 2015 PSIP Review is presented in three (3) sections.
In the first section, an overview of the PSIP is provided in the form of a summary of the expenditure recorded in fiscal year 2015 viz-a-viz the approved budget and actual spending; and is categorised according to types and sources of funding.

Section 2 provides a sectoral analysis of the PSIP including a review of programmes and projects implemented in fiscal year 2015.
The final section discusses the prospects for 2016, highlighting key projects and programmes slated for The 2015 PSIP was fashioned with special implementation in the new fiscal year.

emphasis on investments which aid the rehabilitation and upgrade of critical infrastructure.

A large proportion of the overall budget was dedicated to the upgrade of roads and bridges and to restore housing to those affected by the December 2013 storm.
Apart from this, and within the context of more prudent fiscal control, project readiness was also a key feature of the 2015 PSIP.

Projects for which crucial preparatory activities were advanced and for which firm financing had been secured were given top priority.

Other critical ongoing programmes were also included in the PSIP.

6.2 Overview A sum of $296.4m was approved for the implementation of the 2015 capital programme.
During the fiscal year, the budget was revised to $301.7m, a 1.8 per cent increase in the original budget.

Preliminary data at the end of 2015 indicate that $100.0m or 33.1 per cent of the revised budget was expended.

Preliminary indicators are that this was 4.2 percentage points lower than the 2014 figure.
The decline in the implementation rate could be 114 | P a g e PUBLIC SECTOR INVESTMENT PROGRAMME attributed in part to delays in the completion In terms of domestic financing, $73.9m was of crucial procurement activities in key budgeted from local loans, $39.5m from programmes.

6.3 Financing the PSIP local revenue and $16.9m from local grants (Petro Caribe).

On the external side, $65.5m was allocated from grants and $105.9m from external loans.
Figure 6.2 presents the The PSIP is financed by a combination of comparative expenditure data by types of local and external funds from various funds.

bilateral and multilateral sources.

Figure 6.2: 2015 Revised and Actual Expenditure by Preliminary data for 2015 indicate that a Types of Funds total of $151.5m was secured to fund the capital programme.
In terms of the allocations, approximately 56.8 per cent of the 2015 programme was budgeted to be financed from external sources; and 43.2 per cent from domestic resources (Figure 6.1).

The figures for 2014 were 62.9 percent and 37.1 percent, respectively.

Source: Ministry of Economic Planning, Sustainable Development etc Figure 6.1: 2015 Capital Budget by Type of Funds 6.4 Sources of Financing % 2 .
3 4 , l a c o L Source: Ministry of Economic Planning, Sustainable Development etc The major sources of bilateral financing were Government of Venezuela ($14.5m), the Republic of China (Taiwan) ($16.3m), and the Government of Ecuador ($10.0m).

Multilateral funds came principally from the European Union ($30.2m), the Caribbean Development Bank (CDB) ($31.7m); Alba Caribe ($33.5m) and the World Bank (inclusive of the Climate Investment Fund) ($23.5m).
In addition to these resources, funds amounting to $16.6m were earmarked 115 | P a g e PUBLIC SECTOR INVESTMENT PROGRAMME from Petro Caribe for airport development.

6.5 Composition of Actual Expenditure The funds from EU were primarily earmarked for investments in the health, Preliminary data show that the agriculture, education and tourism sectors; implementation rate was relatively low at Government of Venezuela – airport 33.3 per cent.
However, this rate is development; the Republic of China expected to increase when the government’s (Taiwan) (ROC) – road infrastructure accounts are finalised early in the second development, ICT and health; Government quarter of 2016. of Ecuador – road/bridge infrastructure; CDB – disaster management, community This notwithstanding, as shown in figure infrastructure, roads and education; while 6.4, most of the expenditure (56.9%) during World Bank funded investments were in 2015 was financed from external sources, disaster vulnerability reduction and with 36.6 per cent ($36.6m) from external Information Communication Technology loans and 20.3 per cent from grants (ICT).
Local loans and revenues were ($20.3m).

Spending from local revenues budgeted mainly to provide and loans was 26.3 per cent and 14.6 per matching/counterpart funds for externally cent, respectively.

Spending from local financed projects, the development of roads grants (Petro Caribe) accounted for 2.1 per and bridges, and to finance other cent ($2.1m) of the 2015 actual expenditure.

investments in general administration, national security, health and education.
Figure 6.4: Actual Expenditure by Type of Funds Figure 6.3: Capital Budget by Source of Funds 1 .

3 4 , l a c o L Source: Ministry of Economic Planning, Sustainable Development etc Source: Ministry of Economic Planning, Sustainable Development etc 116 | P a g e PUBLIC SECTOR INVESTMENT PROGRAMME 6.6 Expenditure by Source of Funds Caribe-funded SET Programme.
Figure 6.5 shows that the expenditure has Expenditure from the other sources includes been primarily on projects and programmes IDA ($3.1m), and CIF ($1.9m), Caribbean financed by the Government of Venezuela Development Bank (CDB) ($0.1m).

Actual and Alba Caribe.

The largest expenditures expenditure from local resources totalled from these sources have been on the Argyle $40.9m in 2015.

The funds primarily International Airport, $30.3m.


Combined supported ongoing work at the Argyle with $23.2 million from local resources, the International Airport, the Modern Medical total expenditure on the Argyle International Complex, and 10th EDF Modernisation of Airport accounts for 53.5 per cent of the the Health Sector project, Improvement of overall actual expenditure for 2015.
Education through ICT, Basic Needs Trust Figure 6.5: 2015 Actual Expenditure by Source of Funds Source: Ministry of Economic Planning, Sustainable Development etc Fund (BNTF) 7 and Rehabilitation of the South Leeward Highway.

6.7 Sector Performance The PSIP is classified in accordance with the COFOG (Classification of Functions of Government) system.
Within this system, expenditure is categorized into ten sectors namely General Public Service, Public Order and Safety, Economic Affairs, Environmental Protection, Housing and With regard to the other sources, Community Amenities, Health, Recreation, approximately $6.0m of the actual Culture and Religion, Education and Social expenditure recorded was on projects Protection.

In this section, a review of the financed by the ROC (Taiwan).
These performance of the 2015 PSIP is provided included the rehabilitation of roads (Carapan according to these sectors.

and Swamp Gut), purchase of medical equipment for MCMH, ICT Centre and the rehabilitation of Vigie Highway.
There was expenditure totalling $2.1m on the Petro Overview In keeping with the aim of the 2015 PSIP, the Economic Affairs sector was allocated 117 | P a g e PUBLIC SECTOR INVESTMENT PROGRAMME 56.1 per cent of the 2015 budget, primarily for infrastructure development in transportation (roads, bridges and airport development).

In 2015, significant levels of investments were planned for the Housing, Education and Health sectors.
Accordingly, they were allocated 10.9 per cent, 8.8 per cent and 6.8 per cent of the 2015 budget, respectively.

As regards to actual spending in 2015, the Economic Affairs sector recorded the highest level of expenditure, $66.9m, more than two-thirds of the total actual expenditure.
On closer analysis however, the data revealed that while the Education and Health sectors had lower budgetary allocations relative to Economic Affairs, these sectors had the highest rates of implementation, 58.3 and 52.7 per cent respectively.

Full details on the budgetary allocations and the actual expenditure by sector are provided in Table 1.
118 | P a g e PUBLIC SECTOR INVESTMENT PROGRAMME Table 1:2014 and 2015 Budgeted and Actual Expenditure by Sector Original Budget Revised Budget 2015 Actual Expenditure 2015 2014 2015 % change 2014 2015 % change % change in original budget % of Total Revised Budget 2014 2015 % change % of Total Actual Expenditure Sector Imp.
Rate 6.2 13.9 124.2 7.4 14.9 101.4 7.1 4.9 1.8 3.0 66.7 3.0 20.3 8.9 7.8 0.0 9.0 7.8 -13.3 0 2.6 0.3 0.1 -65.1 0.1 1.1 General Public Services Public Order and Safety Economic Affairs 157.8 165.6 4.9 209.6 168.5 -19.6 15.9 40.2 152.8 17.5 40.2 129.7 1.6 0 55.9 13.3 62.7 66.9 6.7 67.0 39.7 9.2 5.4 -41.3 5.4 13.4 15.8 26.9 70.3 36.7 27.1 -26.8 0.74 8.9 11.3 2.3 -80.5 2.3 8.1 Environmental Protection Housing and Community Amenties Health 22.2 25.2 Recreation, Culture and Religion 1.4 1.8 13.5 28.6 22.9 25.4 1.4 2.0 10.9 42.9 Education 28.7 14.8 -48.4 29.6 15.7 -47 Social Protection 0.3 0.1 -48.2 0.3 0.1 -48.3 Total 257.2 296.3 15.3 334.4 301.7 -9.8 0.8 11.1 6.1 0 1.8 8.4 0.7 8.5 0.3 13.4 57.6 0.2 -14.9 5.2 19.7 0.04 0.0 8.7 0.0 -55.8 -100 113.8 100.0 -12 13.4 0.2 8.8 0.0 52.8 11.2 55.4 0 33.1 *A sectors actual expenditure as a percentage of that sector’s budgetary allocation Source: Ministry of Economic Planning Sustainable Development etc.
Economic Affairs Figure 6.6: AIA - Control Tower and Met.

Station A total of $168.2m or 56.1 per cent of the 2015 budget was allocated to the Economic Affairs sector.

Most (81.0%) of this allocation was directed to the transport subsector, specifically airport and road infrastructure development.

In fact, more than half (54.8%) of the allocation to the transport subsector was for the continued implementation of the Argyle International Airport (AIA).
Of this amount, $53.6m was transferred from central government to the IADC to facilitate the completion of the airport.

Source: International Airport Development Company (IADC) In addition to the investments in airport development, approximately $7.0m was spent on improving the road network.
This included work on the rehabilitation of the Vigie Highway ($1.6m), the rehabilitation of the South Leeward 119 | P a g e PUBLIC SECTOR INVESTMENT PROGRAMME Highway ($2.0m), Rehabilitation of Roads (Carapan and Swamp Gut) ($1.05m); and the Figure 6.8: Ongoing construction at the HMTI Rehabilitation of Congo Valley Road ($1.1m) Additionally, the Construction of Bridges project which was funded by the Government of Ecuador was completed in 2015.
Figure 6.7: Completed Bridge at Chateaubelair Source: Ministry of Economic Planning, Sustainable Development etc Actual expenditure for the year amounted to $1.5m or 22 per cent of the subsector’s allocation compared to $3.0m and 35 per Source: Ministry of Foreign Affairs etc.

cent in 2014.

Most of the expenditure Under this project, four (4) bridges were completed, one each at Hope (Vermont), Jakarta (Fitz-Hughes) and two in Chateaubelair.

The expenditure on this project has not yet been journalised.
Tourism In 2015, the Tourism subsector was allocated a budget of $6.7m to implement a capital portfolio of six (6) projects.

Most of these funds were budgeted to complete the construction of Hospitality and Maritime Training Institute (HMTI).

(($1.1m) was on the EU funded Tourism and Private Sector Development Project under which the Hospitality and Maritime Training Institute (HMTI) is being constructed.

During this year, the administrative block and swimming pool were completed.
In addition, the adjacent Centre of Excellence has been retrofitted to accommodate classrooms and other teaching facilities.

The HMTI is substantially completed.

The remaining activities, primarily the mechanical and electrical components, installation of a cold room generator, procurement of fire fighting facilities and equipment and fencing of the 120 | P a g e PUBLIC SECTOR INVESTMENT PROGRAMME facility will be completed in 2016 at an Implementation is expected to accelerate in estimated cost of $1.5m.
2016 as the AMP moves into full In addition to the HMTI, the Indian Bay Beach Facility was completed at an estimated cost of $0.3m.

The project included the construction of a security booth, vending booths, washroom facilities and parking.
Figure 6.9: Indian Bay Beach Facility Source: Ministry of Transport and Works Agriculture Capital spending in the Agriculture subsector was relatively low in 2015 as preparatory work continued on the sector’s key investment programmes primarily, the EU financed, Agriculture Modernisation implementation.

In addition to this expenditure, $6.0m was transferred to the Farmer Support Company to assist farmers who were affected by the December 2013 flood event.
Work also continued on the Upgrading of Plant & Animal Health Laboratory Capability and Infrastructure project, while minor repair works were undertaken on agricultural extension stations.

Information Communication Technology (ICT) In 2015, there was expenditure totalling $1.8m in the ICT subsector, roughly 41.9 per cent of the budgetary allocation.
Investment spending was primarily on the implementation of the Caribbean Regional Communication Infrastructure Programme ($0.5m) for the business incubation and training grants programme, and a consultancy for the validation and design of a new broadband network.

There was also expenditure on the Government PBX Rehabilitation project ($0.5m) and the ICT Programme (AMP).

Centre ($0.8m).
Centre ($0.8m).

During the reporting period, $0.4m or 3.1 Education per cent of the subsector’s budget was In 2015, investment in the sector was mainly expended compared with $0.6m in 2014. on the improvement of education plant and 121 | P a g e PUBLIC SECTOR INVESTMENT PROGRAMME the continued implementation of the SET upgrade of schools premises (including programme.
A total of $14.9m or 5.0 per West St. George Secondary School, cent of the 2015 capital budget was Intermediate High School, Dorsetshire Hill allocated for investments in the sector, and Government and Kingstown Anglican approximately 53.3 per cent ($8.7m) of the Schools).

In addition, $1.0m was spent on allocation was expended.

When compared the implementation of the Book Loan with 2014, the sector’s implementation rate Scheme.

The overall implementation rate declined by 14.7 percentage points.
This for the subsector was 58.3 per cent.

was on account of the completion of the second phase of the One- Laptop-per- Health Student initiative in 2014.

Additionally, $3.8m was expended for final payments under the Improvement in Education through ICT for the upgrade of the Community College.

There was also a high level of implementation in the Tertiary Education subsector.
The main investment in this sub- sector was on the Support for Education and Training (SET) programme under which 128 community college and university graduates were employed as interns in various government departments.

The initiative, funded by Petro Caribe and the Government of St. Vincent and the Grenadines, began in February 2014 and during the reporting period, 100 per cent of the $2.1m allocation was expended.
In the Secondary Education subsector, approximately $0.8m was spent on the Approximately $25.4m was allocated to the health sector for capital investments in 2015.

This represents a 13 per cent increase over the 2014 allocation.

These investments were aimed at increasing access to good quality health care.
Spending during the year was directed to further develop and modernize the health sector by improving the physical plant and other infrastructure, and procuring critical equipment for the Milton Cato Memorial Hospital.

Preliminary data indicate that actual expenditure on health for the year amounted to $13.4m or 53.2 per cent of the sector’s budget.

The actual expenditure for 2015 shows an increase of 57 per cent over what was spent in 2014.
Expenditure was predominantly on the funded 10th EDF – European Union 122 | P a g e PUBLIC SECTOR INVESTMENT PROGRAMME Modernization of the Health Sector Project April 2016 at estimated cost of $28.7m.

The ($9.9m) for the ongoing construction of remaining activities include minor electrical polyclinics, doctors’ quarters and upgrade of and tiling works, and the supply and the MCMH and the Modern Medical installation of equipment.

The complex is Complex ($2.6m).


Indications are that the expected to become operational in 2016.

Figure 6.11: Modern Medical Complex construction of Modern Medical Complex is nearing completion, and is scheduled to become operational in 2016.

The remaining activities include minor electrical and tiling works, and the supply and installation of equipment.
Figure 6.10: Ongoing Construction of the Buccament Polyclinic Source: Ministry of Health, Wellness and the Environment Other project for which there was expenditure in 2015 include: Purchase of Equipment for MCMH ($0.6m), PAHO/WHO Assistance project – Phase II ($0.2m) which financed training for health personnel and public awareness campaigns in various health related issues; and Infectious Disease Control project ($0.1m).
Environmental Protection Source: Ministry of Economic Planning, Sustainable Development etc.

The estimated total cost of the project is $28.7 million, and on completion, this facility will offer a range of services including dialysis, oncology, ophthalmology, diagnostic (radiology, ultrasound, and laboratory), endoscopy, A total of $40.3m or 13.4 per cent of the intensive care and related outpatient 2015 capital budget was allocated to services.
The construction of the complex is environmental protection mainly for expected to be completed by the end of investments related to climate change and 123 | P a g e PUBLIC SECTOR INVESTMENT PROGRAMME disaster risk reduction and management.
Other programmes for which there was Expenditure in this sector for the period spending include Promoting Access to Clean under review amounted to $5.4 m, which is Energy project ($0.07m) the Montreal equivalent to 40.3 per cent of the sector’s Protocol/National Ozone Project financed by budget and 5.4 per cent of total capital UNEP, ($0.05m), and the GEF funded spending.

National Biosafety Framework ($0.01m).


Analysis of the preliminary data shows that relative to 2014, there were declines in both the level of expenditure and the rate of implementation in the subsector.

In the first instance, there was a 57.8 per cent decrease in absolute actual expenditure and in the latter, a decrease of 61 percentage points in the overall implementation rate (from 74.4 % in 2014 to 13.3% in 2015).

This may be a direct result of under reporting in the sector.
In the area of disaster management, two programmes are noteworthy, the World Bank/Climate Investment Fund (CIF) financed Regional Disaster Vulnerability Reduction Programme (RDVRP) and the CDB/GoSVG financed Natural Disaster Management Rehabilitation Project (NDMRP).

Work on both projects is ongoing with much of the focus on the pre- construction studies and designs.

At year end, the RDVRP recorded expenditure of $5.2m, 25.5 per cent of its 2015 allocation.
While work was executed on the NDMRP, the expenditure has not been journalised.

Housing and Community Amenities In 2015, this sector was allocated $26.9m, approximately 9 per cent of the total 2015 budget.

The allocation was primarily to finance work in the Housing sector.

The main projects include the Housing Reconstruction/Rehabilitation Project – Flood Damage 2013; Low Income Housing Project; Clare Valley Reconstruction Project and the Gibson Corner Resettlement Project.
In terms of implementation, preliminary data indicate actual expenditure of $2.3m mainly on the Low Income Housing Project ($0.8m) and the Gibson Corner Resettlement Project ($0.4m).

There was also activity on the Housing Reconstruction/Rehabilitation Project including the “Lives to Live” initiative however the expenditure has not yet been journalised.
As it relates to Community Development, work continued on the CDB - Rural 124 | P a g e PUBLIC SECTOR INVESTMENT PROGRAMME Development – Community Infrastructure expenditure for these sectors was $0.3m, (BNTF 7).

In 2015, actual expenditure was accounting for 0.3 per cent of the total actual $0.7m.
This amount was expended to expenditure for 2015. complete the construction of the Bequia Hospital, provide the design for the Early Childhood Centre at Greiggs and trained 142 persons – (67 in Early Childhood Education and 25 each in Electrical Installation, Plumbing, and Air Conditioning/Refrigeration.

6.8 Prospects for 2016 The 2016 capital budget amounts to $197.7m.

Actual expenditure is projected to be $90.0m in 2016, approximately 45.5 per cent of the year’s budget.
This increase is projected based on an anticipated increase in the rate of implementation as several General Public Service major projects move into full Expenditure on General Public Service amounted to approximately $3.0m or 20.8 percent of the sector’s capital budget ($14.6m).

Spending in the sector was mainly on the Rehabilitation/Upgrading of the Administrative Centre ($0.5m) and the purchase of furniture, equipment and vehicles ($0.5m).
In addition, just over $1.0m was expended to provide critical project management support for the implementation of development programmes primarily the European Development Fund (EDF)-financed projects.

Other Sectors Minimal expenditure was recorded by the other three sectors: Recreation, Culture & Religion, Public Order & Safety and Social Protection.

Collectively, the actual implementation.


Specifically, construction works are expected to accelerate on the Natural Disaster Rehabilitation Project, Regional Disaster Vulnerability Reduction Project, and the South Leeward Highway and on other road rehabilitation and reconstruction programmes.

The Agriculture Modernisation Programme is also expected to record higher rates of implementation in 2016.

In addition, there is expected to be further investments on the Argyle International Airport.
125 | P a g e PROSPECTS .

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PROSPECTS The global economy is projected to The economy of St. Vincent and the experience moderate growth during 2015.

Grenadines is expected to post moderate This is reflected in the increased growth during 2015.

The agricultural sector performance of the advanced economies, is projected to experience stronger growth supported by lower oil prices and relative to 2014, buoyed by growth in accommodative monetary policies.
banana production, supported by increases Meanwhile emerging markets are projected the average price per tonne.

The tourism to experience a further slowdown due to a sector is also expected to expand, supported combination of factors; lower growth in oil by a projected expansion in stay over exporters, a slowdown in China; visitors and cruise visitors.

Similarly, the deteriorating outlook for exports of other manufacturing sector is projected to rebound commodities following price declines.
with the assistance of increased beverage Meanwhile, oil prices are expected to production.

The construction sector is remain low relative to 2014, posing growth expected to post growth as the South challenges to countries dependent on oil Leeward Highway project continues and the exports.

Argyle international airport is scheduled for Growth in the economies of Latin America completion.
and the Caribbean is projected to be lower in Meanwhile, recent lowering of interest rates 2015 as recent expansions of capital inflows by the Eastern Caribbean Central Bank is to the region is expected to stabilise.

expected to lower the liabilities of Moreover, those economies dependant on oil commercial banks.

Barring excessive risk and other commodity exports are expected aversion policies, this move may likely to be constrained by low commodity prices.
provision more credit to various sectors, and Meanwhile, inflation rates are expected to stimulate investment and growth in the remain low throughout the LAC region.

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126 | P a g e ANNEXES .

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ANNEXES Annex 1: GDP by Economic Activity in Current Prices 2010-2014 (EC$M) SECTOR Agriculture, Hunting & Forestry Crops Bananas Other Crops Livestock Forestry Fishing Mining & Quarrying Manufacturing Electricity & Water Electricity Water Construction Wholesale & Retail Trade Hotels & Restaurants Hotels Restaurants Transport, Storage and communications Transport and Storage Road Sea Air Supporting and auxiliary transport activities Communications Financial Intermediation Banks & Other Financial Institutions Insurance and pension funding Activities auxiliary to financial intermediation Real Estate, Renting and Business Activities Owner Occupied Dwellings Real estate activities Renting of machinery and equipment Computer and related activities Business Services Public Administration, Defence & Compulsory Social Security Education Health and Social Work Other community, social & personal services Private Households with Employed Persons Less FISIM Gross Value Added at Basic Prices GROWTH RATE Taxes on products Less Subsidies GDP at Market Prices GROWTH RATE R P -0.08 271.4 1.1 1,825.46 - Source: Statistical Office, Ministry of Economic Planning, Sustainable Development etc 127 | P a g e ANNEXES .
Annex 2: GDP by Economic Activity in Constant (2006) Prices: 2010-2014, (EC$M) SECTOR 2010 2011 2012 2013 R 2014 P Agriculture, Hunting & Forestry Crops Bananas Other Crops Livestock Forestry Fishing Mining & Quarrying Manufacturing Electricity & Water Electricity Water Construction Wholesale & Retail Trade Hotels & Restaurants Hotels Restaurants Transport, Storage & Communication Transport, Storage Road Sea Air Supporting and auxiliary transport activities Communications Financial Intermediation Banks & Other Financial Institutions Insurance and pension funding Activities auxiliary to financial intermediation Real Estate, Renting & Business Services Owner Occupied Dwellings Real estate activities Renting of machinery and equipment Computer and related activities Business services Public Administration, Defence and Compulsory Social Security Education Health and Social Work Other community, social & personal services Private Households with Employed Persons Less FISIM Gross Value Added at Basic Prices GROWTH RATE Taxes on products Less Subsidies GDP at Market Prices GROWTH RATE -2.34 253.28 1.35 1,638.26 -3.36 63.03 42.82 30.83 3.21 16.67 1,389.70 0.24 242.52 0.98 1,631.24 -0.43 66.16 44.87 32.17 3.41 17.18 1,407.75 1.30 246.93 0.84 1,653.84 1.39 67.94 44.20 30.09 3.50 14.40 1,440.32 2.31 253.89 0.93 1,693.28 2.38 65.61 42.81 30.47 3.43 14.98 1,436.80 -0.24 255.61 0.92 1,691.48 -0.11 Source: Statistical Office, Ministry of Economic Planning, Sustainable Development etc 128 | P a g e ANNEXES .
Annex 3: Percentage Contribution of Gross Value Added by Economic Activity in Current Prices: 2010-2014 SECTOR 2010 2011 2012 2013 R 2014 P Agriculture, Hunting & Forestry Crops Bananas Other Crops Livestock Forestry Fishing Mining & Quarrying Manufacturing Electricity & Water Electricity Water Construction Wholesale & Retail Trade Hotels & Restaurants Hotels Restaurants Transport, Storage & Communications Transport & Storage Road Sea Air Auxiliary transport activities and storage Communications Financial Intermediation Banks & Other Financial Institutions Insurance and pension funding Activities auxiliary to financial intermediation Real Estate & Housing Owner Occupied Dwellings Real Estate activities Renting of machinery and equipment Computer related services Business services Public Administration , Defence and Compulsory Social Security Education Health & Social Work Other community, Social & Personal services Private Households with Employed Persons FISM Gross Value Added at Basic Prices Source: Statistical Office,, Ministry of Economic Planning, Sustainable Development etc | P a g e ANNEXES .
Annex 4: Percentage Contribution of Gross Value Added by Economic Activity in Constant (2006) Prices: 2010-2014 SECTOR 2010 2011 2012 2013 R 2014 P Agriculture, Hunting & Forestry Crops Bananas Other Crops Livestock Forestry Fishing Mining & Quarrying Manufacturing Electricity & Water Electricity Water Construction Wholesale & Retail Trade Hotels & Restaurants Hotels Restaurant Transport, Storage & Communications Transport & Storage Road Sea Air Auxiliary transport activities and storage Communications Financial Intermediation Banks & Other Financial Institutions Insurance and pension funding Activities auxiliary to financial intermediation Real Estate, Renting and Business services Owner Occupied Dwellings Real Estate activities Renting of machinery and equipment Computer related services Business services Public Administration , Defence and Compulsory Social Security Education Health & Social Work Other Community, Social & Personal services Private Households with Employed 0.24 Persons 1.22 Less FISM 100.00 TOTAL Source: Statistical Office, Ministry of Economic Planning, Sustainable Development etc | P a g e ANNEXES .
Annex 5: Rate of Growth of Gross Value Added by Economic Activity in Current Prices: 2010-2014 SECTOR 2010 2011 2012 2013 R 2014 P 4.63 1.57 -89.83 6.99 20.89 -2.00 -6.56 -25.46 -10.81 -6.33 -5.05 -11.22 -1.62 -1.99 23.06 20.91 28.44 -0.53 -3.49 -0.92 -0.37 -7.44 -19.04 6.15 -16.84 -19.25 -8.55 4.74 10.94 -30.32 14.97 -18.47 -3.00 -8.90 -21.07 9.15 12.33 15.61 1.34 -4.21 -1.87 -10.87 -11.43 -9.45 -2.07 0.34 -2.56 33.90 -2.59 1.14 -7.11 2.53 3.45 -1.50 -0.47 1.61 65.37 1.26 -9.45 -2.00 -4.26 -20.00 1.39 -0.16 -2.25 8.40 -1.89 5.98 9.62 10.77 6.92 1.98 2.46 1.41 1.42 -0.62 12.39 0.98 2.38 -3.39 14.82 Agriculture, Hunting & Forestry Crops Bananas Other Crops Livestock Forestry Fishing Mining & Quarrying Manufacturing Electricity & Water Electricity Water Construction Wholesale & Retail Trade Hotels & Restaurants Hotels Restaurants Transport, Storage & Communications Transport & Storage Road Sea Air Auxiliary transport activities Communications Financial Intermediation Banks & Other Financial Institutions Insurance and pension funding Activities Auxiliary to financial intermediation Real Estate, Renting and Business Services Owner Occupied Dwellings Real Estate activities Renting of machinery and equipment Computer related activities Business Services Public Administration , Defence and Compulsory Social Security Education Health & Social Work Other Community, Social & personal activities Private Households with Employed Persons Less FISM TOTAL Source: Statistical Office, Ministry of Economic Planning, Sustainable Development etc -0.30 0.79 0.70 -0.45 -15.00 -4.45 6.83 2.22 2.55 2.54 -4.00 -21.33 6.32 17.28 2.46 0.84 0.74 5.18 68.64 3.88 6.21 3.57 -9.29 -0.08 0.11 6.69 2.40 6.62 9.23 2.00 4.97 7.03 2.48 9.03 7.40 5.19 -28.49 -14.67 13.44 15.33 -3.34 5.90 8.94 9.80 26.46 9.64 5.30 -2.00 14.45 -3.16 4.75 -1.94 -1.60 -3.21 7.77 3.75 14.60 15.91 11.38 2.31 0.94 -0.11 -1.02 9.63 5.50 5.14 1.71 0.69 -4.31 70.06 2.38 1.15 1.02 -0.48 1.61 12.84 7.49 1.77 3.17 6.20 2.18 -15.68 4.66 3.20 4.41 -12.18 4.58 -2.70 -2.00 1.16 -2.97 7.55 -0.64 0.13 -3.54 -11.77 0.06 -3.11 -4.83 1.28 0.39 0.22 0.05 -0.76 9.63 -2.24 0.72 5.17 6.71 -0.93 18.75 1.25 1.27 1.12 -0.44 0.40 1.85 3.49 -0.66 -2.77 1.58 2.89 3.99 0.36 131 | P a g e ANNEXES .
Annex 6: Rate of Growth of Gross Value Added by Economic Activity at Basic Prices, in Constant (2006) Prices 2010- 2014 SECTOR 2010 2011 2012 2013 R 2014 P 2.21 3.72 51.56 3.00 -2.72 -4.94 -14.93 -24.44 -4.32 4.86 3.76 8.40 -3.53 3.29 0.16 -2.22 5.59 -0.23 -0.21 -0.62 1.42 -2.42 0.77 -0.30 0.13 -2.49 5.66 0.06 -1.53 -85.20 7.68 6.09 -2.00 -3.01 -24.73 4.92 -2.19 0.19 -9.14 -3.37 -5.01 4.10 5.69 0.63 0.27 -0.14 0.83 -2.90 -3.88 -2.48 1.45 3.63 -3.63 31.00 -18.03 -5.64 -41.44 1.16 -45.26 -3.00 -15.15 -21.83 -4.93 -4.54 -1.21 -13.09 -3.12 -0.91 -14.19 -18.24 -3.79 -1.58 0.82 1.38 -2.49 -2.07 0.75 -7.94 -6.29 -2.13 -18.63 Agriculture, Hunting & Forestry Crops Bananas Other Crops Livestock Forestry Fishing Mining & Quarrying Manufacturing Electricity & Water Electricity Water Construction Wholesale & Retail Trade Hotels & Restaurants Hotels Restaurants Transport, Storage & Communications Transport & Storage Road Sea Air Auxiliary transport activities and storage Communications Financial Intermediation Banks & Other Financial Institutions Insurance and pension funding Activities auxiliary to financial intermediation Real Estate, Renting & Business Services Owner Occupied Dwellings Real estate activities Renting of machinery and equipment Computer & Related services Business Services Public Administration, Defence and Compulsory Social Security Education Health & Social Work Other Community , Social & Personal services Private Households with Employed Persons Less FISM TOTAL Source: Statistical Office, Ministry of Economic Planning, Sustainable Development etc -0.28 0.09 0.08 -2.32 -22.95 3.11 8.61 0.59 0.79 0.70 -2.98 -15.00 3.41 5.29 0.30 0.84 0.74 0.86 3.82 -4.90 4.82 1.55 -4.96 0.24 1.55 -2.65 -2.34 6.27 3.03 1.30 -1.23 1.82 2.38 6.38 4.97 4.77 12.94 10.00 -7.61 -6.05 4.35 0.38 5.80 6.59 9.02 6.54 3.23 -2.00 6.60 -10.87 -3.46 -0.45 -0.71 0.36 6.60 2.89 -0.08 -2.98 6.05 -0.67 -0.30 0.59 -1.81 -4.51 -3.18 -1.72 2.76 3.57 -0.90 2.92 4.28 -19.12 4.81 -2.04 -2.00 2.31 -2.97 6.31 -1.13 -0.35 -3.54 -11.83 -0.12 -2.39 -4.28 1.28 -0.23 -0.25 0.36 -0.96 -3.08 -2.54 -0.18 2.10 2.68 0.86 18.75 0.20 1.60 1.15 1.02 -1.27 0.80 6.71 5.75 2.69 -1.48 -6.47 2.68 -16.18 2.31 1.27 1.27 1.12 -0.64 0.20 2.19 3.47 -3.42 -3.15 1.27 -2.00 4.03 -0.24 132 | P a g e ANNEXES .
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Annex 7: Point to Point Inflation Rate January to September 2011-2015 January February March April May June July August September Average -0.3 0.5 0.9 1.0 0.1 -0.2 -0.4 -0.3 -0.5 -0.2 0.9 0.8 0.3 0.1 -0.2 -1.1 -1.8 -2.2 -1.8 -1.8 -1.6 -1.9 -1.7 -1.6 Source: Statistical Office, Ministry of Economic Planning, Sustainable Development etc 133 | P a g e ANNEXES .
Annex 8: Central Government Fiscal Operations (EC$M) Details Jan - Sept 2012 Jan - Sept 2013 Jan - Sept 2014 Jan - Sept 2015 TOTAL REVENUE & GRANTS 347.75 383.75 405.93 402.26 CURRENT REVENUE 336.62 341.01 375.17 374.90 Taxes on Income and Profits 86.20 77.65 83.28 90.58 Taxes on Property 1.96 2.34 2.81 3.37 Taxes On International Trade 122.78 121.69 129.27 141.32 Taxes on Domestic Transactions 86.90 89.20 91.55 90.47 Licences 15.61 20.61 23.68 21.43 Fees, Fines and Permits 12.98 13.38 14.01 13.87 Interest, Rent and Dividends Other Revenue 4.11 6.08 6.44 9.70 13.92 16.65 5.47 8.40 CAPITAL REVENUE & GRANTS 11.13 42.75 30.76 27.36 Sale of Crown Lands Grants Other 0.85 5.97 4.31 24.06 0.58 5.45 13.96 30.14 11.82 4.73 0.04 10.10 TOTAL EXPENDITURE 376.38 421.03 444.23 429.37 RECURRENT EXPENDITURE 354.38 358.45 379.22 374.95 CAPITAL EXPENDITURE 22.33 62.58 65.01 54.42 CURRENT BALANCE -17.75 -17.44 -4.05 PRIMARY BALANCE 0.83 -7.59 -4.98 OVERALL BALANCE (Before Grants) OVERALL BALANCE (After Grants) -34.92 -29.95 -51.24 -37.28 -68.44 -38.30 Source: Ministry of Finance -0.05 4.83 -38.93 -27.11 134 | P a g e ANNEXES .
Annex 9: Debt Composition in EC$M Jan - Sept 2011 Jan - Sept 2012 Jan - Sept 2013 Jan - Sept 2014 Jan - Sept 2015 Total Public Debt 1128.4 1215.9 1377.1 1460.2 1511.2 External Debt 633.0 647.2 776.0 829.6 864.5 Central Government 107.6 105.4 689.8 753.8 790.5 Public Corporations 86.2 75.8 74.0 Domestic Debt 495.4 568.8 601.1 630.6 646.7 Central Government 404.8 462.6 473.4 497.9 502.4 106.1 127.7 132.6 144.3 Public Corporations Central Government Debt Service External Amortisation Interest Payments Domestic Amortisation Interest Payments Sinking Fund Na Total Debt as per cent of GDP 61.8 65.0 70.2 Debt Service as a per cent of current revenue (%) Source: The Ministry of Finance 26.1 25.0 27.7 27.9 27.6 135 | P a g e ANNEXES .
Annex 10: Merchandise Trade - January to September (EC$M) Mineral Fuels & Related Materials 126.8 163.1 143.5 144.9 Total Exports Total Domestic Exports Total Re-exports Total Imports Trade balance Imports by S.I.T.C Sections Food & Live Animals Beverages and Tobacco Crude Materials, Inedible Except Fuels Animal & Vegetable Oils, Fats & Waxes Chemicals & Related Products Manufactured Goods Machinery & Transport Equipment Miscellaneous Manufactured Articles Commodities & Transactions not classified elsewhere in SITC Exports by S.I.T.C Sections Food & Live Animals Beverages and Tobacco Crude Materials, Inedible Except Fuels Mineral Fuels & Related Materials Animal & Vegetable Oils, Fats & Waxes Chemicals & Related Products Manufactured Goods Machinery & Transport Equipment Miscellaneous Manufactured Articles Commodities & Transactions not 2011 73.7 63 10.7 2012 2013 2014 2015 83.9 74.6 9.3 95.2 83.3 11.9 96.7 78.1 18.6 90.3 82.2 8.1 661.4 709.3 744.3 712.8 638.4 -587.7 -625.4 -649.1 - -548 638.4 155.3 23.8 22.3 78.0 3.0 54.4 112 127.9 61.7 0 90.3 57.1 13.4 0.6 0 0 0.5 9.7 5.9 3.0 0.1 136 | P a g e classified elsewhere in SITC Source: Statistical Office, Ministry of Economic Planning, Sustainable Development etc 0 0 0 ANNEXES .
ANNEXES 11: Visitor Arrivals by Visitor Type Visitor type By Air Stay Overs Same Day Sub Total By Sea Yacht Cruise Ship Sub Total Jan - Sept 2011 Jan - Sept 2012 Jan - Sept 2013 Jan - Sept 2014 Jan - Sept 2015 % Change 2011 % Change 2012 % Change 2013 % Change 2014 % Change 2015 55,479 3,136 58,615 56,368 2,339 58,707 53,594 2,232 55,826 52,673 1,662 54,335 54,759 1,334 56,093 2.1 -21.6 0.5 1.6 -25.4 0.2 -4.9 -4.6 -4.9 -1.7 -25.5 -2.7 33,697 33,982 34,140 36,214 35,977 7.4 0.8 0.5 58,695 92,392 49,433 83,415 55,737 89,877 55,816 92,030 53,610 89,587 -16.8 -9.4 -15.8 -9.7 12.8 7.7 6.1 0.1 2.4 4.0 -19.7 3.2 -0.7 -4.0 -2.7 Total 151,007 142,122 145,703 146,365 145,680 -5.8 -5.9 2.5 0.5 -0.5 Source: St. Vincent and the Grenadines Tourism Authority 137 | P a g e ANNEXES .
Annex 11: Stay –Over Visitors by Country of Residence COUNTRIES USA CANADA ANTIGUA BARBADOS GRENADA ST. LUCIA TRINIDAD FRENCH CARIBBEAN DUTCH CARIBBEAN OTHER CARIBBEAN UNITED KINGDOM FRANCE GERMANY ITALY SWEDEN SWITZERLAND BELGIUM SPAIN IRELAND HOLLAND NORWAY OTHER EUROPE SOUTH AMERICA OTHER COUNTRIES TOTAL Source: St. Vincent and the Grenadines Tourism Authority JAN - SEPT 2015 16084 5346 607 4462 750 1257 5378 282 225 3029 12303 549 537 328 314 274 85 90 128 81 117 683 886 964 54759 JAN - SEPT ACTUAL CHANGE 1135 163 53 75 25 12 533 40 10 -184 768 -81 3 -134 59 21 13 -7 -5 3 -35 -88 -308 15 2086 2014 14949 5183 554 4387 725 1245 4845 242 215 3213 11535 630 534 462 255 253 72 97 133 78 152 771 1194 949 52673 % CHANGE 7.6 3.1 9.6 1.7 3.4 1.0 11.0 16.5 4.7 -5.7 6.7 -12.9 0.6 -29.0 23.1 8.3 18.1 -7.2 -3.8 3.8 -23.0 -11.4 -25.8 1.6 4.0 138 | P a g e ANNEXES .
Annex 12: Cruise visitors by Port of Entry Port of entry Jan-Sept 2014 Jan-Sept 2015 Actual Change % Change Kingstown Bequia Canouan Union Island 36,542 12,409 373 6,492 39,450 5,035 402 8,723 Total 53,610 Source: St. Vincent and the Grenadines Tourism Authority 55,816 2,908 -7,374 29 2,231 -2,206 8.0 -59.4 7.8 34.4 -4.0 Annex 13: Yacht visitors by port of entry Port of Entry Jan-Sept 2014 Jan-Sept 2015 Actual Change % Change Kingstown Bequia Mustique Canouan Walliabou Union Island Chateaubelair 1,425 21,079 1,528 808 1,828 8,368 1,178 2,028 20,834 936 455 1,628 8,898 1,198 603 -245 -592 -353 -200 530 20 42.3 -1.2 -38.7 -43.7 -10.9 6.3 1.7 Total 36,214 35,977 -237 -0.7 Source: St. Vincent and the Grenadines Tourism Authority 139 | P a g e ANNEXES .
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Annex 14: Distribution of Assistance Number of Number of Amount Sub-programme Families Individuals (EC$) National Assistance Fund 3000 4661 8,823,805.00 Foster Care Monthly Emergency Uniforms 100 626 304 1000 151 288,750.00 3770 553,333.22 1735 3865 602,853.86 1,100,000.00 COL Supports Total Refund 5,030 Refund 14,182 128,628.33 11,497,370.41 Source: Ministry of National Mobilisation etc 140 | P a g e ANNEXES .

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Annex 15: Leading Causes of Death (2010-2014) Causes 2010 2011 2012 2013 2014 Malignant Neoplasm 122 141 131 174 168 Ischemic Heart Diseases 106 118 107 130 139 Communicable Diseases 101 87 96 100 107 Diabetes Mellitus Cerebrovascular Disease Hypertension Disease Injuries and Violence Heart Disease (Other Forms) Diseases of the Perinatal Period Disease Of The Digestive System Source: Ministry of Health, Wellness and the Environment Annex 16: Number of HIV/AIDS Cases and Deaths (2010-2015) New HIV Cases No of AIDS Cases 63 2010 45 2011 41 2012 62 2013 65 2014 67 2015 Source: Ministry of Health, Wellness and the Environment 33 30 18 30 38 42 No of Deaths 28 22 23 36 32 23 141 | P a g e ANNEXES .
Annex 17: 2015 Capital Expenditure by Type and Source of Funds Source of Funds Estimated EC$ (m) Revised EC$(m) Actual EC$ (m) Type of Funds Local Local Loans Petro Caribe Local Revenue CDB PAHO Mexico Govt of Venezuela Govt of Ecuador CIF COMSEC ROC(Taiwan) External Grants Govt of Germany UNDP EU GEF Govt of Kuwait USAID UNEP UNESCO Other External Grants UNICEF CDB Govt of Venezuela CIF External Loans ROC(Taiwan) Other IDA CDF Total | P a g e ANNEXES .
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Annex 18: 2014 and 2015 Capital Expenditure by Type of Funds 2014 2015 Type of Fund Original Budget Revised Budget Actual Expenditure Original Budget Revised Budget Actual Expenditure Imp.

Rate* (%) % of Revised Budget Imp.
Rate* (%) Domestic Revenue Loan Grants Sub Total for Domestic External Loan Grants Sub Total for External TOTAL 257.1 335.4 125.2 37.3 296.4 301.7 99.9 33.1 *Actual expenditure as a percentage of revised expenditure 143 | P a g e ANNEXES .
SOME BENEFICIARIES UNDER SOME SOCIAL PROTECTION PROGRAMMES (1) Beneficiaries under some programmes of the Ministry of Social Appendix II Development Number of children in care and Rehabilitation Number of children in foster care Number of children in truant Students’ programme Number of parents in parenting Programme Number of students in Behavioural Modification Programme Number of students in After School Time Programme Number of YES Volunteers Number of households receiving assistance under public assistance Number of Elderly receiving national Assistance Number of Elderly in Home-Help Programme Number of children receiving monthly assistance : : : : : : : : : : 330 155 75 300 140 280 500 5,200 2,500 220 1,800 144 | P a g e (2) Beneficiaries under some programmes in Ministry of Education Number of Adult Students Number of Adult Students enrolled in regional certified programmes Number of children in School Feeding Programme : : : 2,000 1,240 8,648 (3) Beneficiaries under some programmes in Ministry of Health Number of accessions to diagnostic Services in health sector Number of scheduled in-patient Admissions Number of scheduled out-patient Visits Number of elderly in long-term Residential care Number of elderly with disability, Provided with assistance : : : : : 84,000 8,200 22,000 80 55 145 | P a g e Proposed Excise Duty Description of Goods Beer Stout Other Wine of fresh grapes, including fortified wines; grape must other than that of heading 22.09 Vermouth and other wine of fresh grape flavoured with plans or aromatic substances.
Other fermented beverages (for example, cider, perry, mead); mixture of fermented beverages and non-alcoholic beverages, not elsewhere specified or included.
Brandy Whiskies Rum and Tafia In bottles of strength not exceeding 46% volume Gin Geneva Vodka Cordials and Liqueurs Other spirituous beverages Appendix III Current Rate Proposed rate $0.83 per litre $0.76 per litre $0.83 per litre $0.76 per litre $0.83 per litre $0.66 per litre $6.00 per litre $5.32 per litre $5.32 per litre $6.00 per litre $0.80 per litre $1.00 per litre $5.32 per litre $5.32 per litre $5.32 per litre $5.32 per litre $6.00 per litre $6.00 per litre $6.00 per litre $6.00 per litre $5.32 per litre $5.32 per litre $5.32 per litre $5.32 per litre $6.00 per litre $6.00 per litre $6.00 per litre $6.00 per litre Heading 2203.001 2203.002 2203.009 22.04 22.05 22.06 2208.20 2208.30 2208.40 2208.401 2208.50 2208.60 2208.70 2208.909 146 | P a g e Appendix IV Motor and Drivers Licenses: Current and Proposed Part A Motor Vehicles Current $ Proposed $ Private Motor Cars: Not exceeding 2,000 lbs tare Exceeding 2,000 lbs tare but not exceeding 3,000 lbs tare Exceeding 3,000 lbs tare Private Motor Tricycles: Not exceeding 2,000 lbs tare Exceeding 2,000 lbs tare Private Motor Cycles: Without side car With side car Good Vehicle Of less than 2 tons tare (4480 lbs) Of 2 tons tare but less than 3 tons tare Of 3 tons tare but less than 5 tons tare Of 5 tons tare but less than 10 tons Of greater than 10 tons Trailers Not exceeding 1 ton tare Of 1 tons tare but less than 3 tons tare Of 3 tons tare but less than 10 tons Of greater than 10 tons Tractors Of less than 2600 lbs tare Of 2600 lbs tare or over Hearses Motor vehicles constructed and licensed to be used solely as hearses Hiring Cars, Rented Cars, Taxis and Motor Omnibuses Motor vehicles licensed to carry not more than 4 passengers 750.00 940.00 excluding the driver 320.00 400.00 147 | P a g e Motor vehicles licensed to
 carry not more than 6 passengers excluding the driver 375.00 470.00 Motor buses of less than 2 tons tare licensed to carry passengers only 430.00 540.00 Motor buses of 2 tons tare but less than 3 tons tare licensed to carry passengers only Motor buses of 3 tons tare or over licensed to carry passengers only Rental motor cycles Part B Miscellaneous Driving Permit: One (1) Year Three (3) years Five (5) years Tutor's permit Learner's permit Registration and change of ownership Duplicate licences or permits Examination of a driver Dealer's licence Fee for Inspection of a motor vehicle Temporary driving permit International driving permit Conductor of omni-buses and mini buses Fee for personalised number plate payable on registration 460.00 575.00 490.00 200.00 615.00 250.00 Current Proposed 75.00 200.00 325.00 125.00 65.00 100.00 65.00 60.00 2500.00 65.00 65.00 100.00 10.00 1500.00 100.00 275.00 425.00 200.00 100.00 150.00 100.00 100.00 3200.00 90.00 100.00 150.00 15.00 2500.00 148 | P a g e Heading No.
87.02 8702.10.20 8702.10.40 8702.10.60 8702.90.20 8702.90.40 8702.90.60 8702.90.90 Other 87.03 Vehicle Surcharge on Vehicle over 4 Years old Appendix V Description of Goods Current Proposed Motor Vehicles for the transport of ten or more persons, including the driver Other Coaches, buses and mini-buses, of a seating capacity not exceeding 21 persons (including the driver) $ 3,500.00 $ 4,000.00 Other Coaches, buses and mini-buses, of a seating capacity exceeding 21 persons but not exceeding 29 persons (including the driver) $ 4,000.00 $ 4,600.00 Other Coaches, buses and mini-buses, of a seating capacity exceeding 29 persons (including the driver) 8702.10.90 Other $ 4,500.00 $ 5,200.00 $ 4,500.00 $ 5,200.00 Other Coaches, buses and mini-buses, of a seating capacity not exceeding 21 persons (including the driver) $ 3,500.00 $ 4,000.00 Other Coaches, buses and mini-buses, of a seating capacity exceeding 21 persons but not exceeding 29 persons (including the driver) $ 4,000.00 $ 4,600.00 Other Coaches, buses and mini-buses, of a seating capacity exceeding 29 persons (including the driver) $ 4,500.00 $ 5,200.00 $ 4,500.00 $ 5,200.00 Motor cars and other motor vehicles principally designed for transport of persons (other than those of heading 87.02), including station wagons and racing cars.
149 | P a g e 8703.21.90 8703.22.90 8703.23.20 8703.23.30 8703.23.40 8703.24.90 8703.31.90 8703.32.20 8703.32.40 8703.33.90 8703.90.00 87.04 8704.10.00 8704.21.90 8704.22.90 8704.23.90 8704.31.90 8704.32.90 8704.90.00 8705.10.00 8705.20.00 8705.40.00 8705.90.00 87.03 8703.21.90 8703.23.20 Other Other $ 3,000.00 $ 3,450.00 $ 3,000.00 $ 3,450.00 Of a capacity exceeding 1,500 cc but not exceeding 1,800 cc $ 3,000.00 $ 3,450.00 Of a capacity exceeding 1,800 cc but not exceeding 2,000 cc $ 3,500.00 $ 4,000.00 Of a capacity exceeding 2,000 cc but not exceeding 3,000 cc $ 4,000.00 $ 4,600.00 Other Other $ 4,500.00 $ 5,200.00 $ 3,000.00 $ 3,450.00 Of a capacity exceeding 1,500 cc but not exceeding 2,000 cc $ 3,500.00 $ 4,000.00 Of a capacity exceeding 2,000 cc but not exceeding 2,500 cc $ 4,000.00 $ 4,600.00 Other Other Motor Vehicles for the transport of goods Dumpers designed for off-highway use Other Other Other Other Other Other Crane lorries Mobile drilling derricks Concrete-mixer lorries Other Motor cars and other motor vehicles principally designed for transport of persons (other than those of heading 87.02), including station wagons and racing cars.
$ 4,500.00 $ 5,500.00 $ 4,500.00 $ 5,500.00 $ 4,000.00 $ 5,000.00 $ 4,000.00 $ 4,600.00 $ 4,000.00 $ 4,600.00 $ 4,000.00 $ 4,600.00 $ 4,000.00 $ 4,600.00 $ 4,000.00 $ 4,600.00 $ 4,000.00 $ 4,600.00 $ 4,000.00 $ 4,500.00 $ 4,000.00 $ 4,500.00 $ 4,000.00 $ 4,500.00 $ 4,000.00 $ 4,500.00 Other $ 3,000.00 $ 3,450.00 Of a capacity exceeding 1,500 cc but not exceeding 1,800 cc $ 3,000.00 $ 3,450.00 150 | P a g e 8703.23.30 8703.23.40 8703.24.90 8703.31.90 8703.32.20 8703.32.40 8703.33.90 8703.90.00 87.04 8704.10.00 8704.21.90 8704.22.90 8704.23.90 8704.31.90 8704.32.90 8704.90.00 87.05 8705.10.00 8705.20.00 8705.40.00 8705.90.00 Of a capacity exceeding 1,800 cc but not exceeding 2,000 cc $ 3,500.00 $ 4,000.00 Of a capacity exceeding 2,000 cc but not exceeding 3,000 cc $ 4,000.00 $ 4,600.00 Other Other $ 4,500.00 $ 5,200.00 $ 3,000.00 $ 3,450.00 Of a capacity exceeding 1,500 cc but not exceeding 2,000 cc $ 3,500.00 $ 4,000.00 Of a capacity exceeding 2,000 cc but not exceeding 2,500 cc $ 4,000.00 $ 4,600.00 Other Other Motor Vehicles for the transport of goods Dumpers designed for off-highway use Other Other Other Other Other Other Special purpose motor vehicles, other than those principally designed for the transport of persons or goods (for example, breakdown lorries, crane lorries, fire fighting vehicles, concrete mixer lorries, road sweeper lorries, spraying lorries, mobile workshops, mobile radiological units).
Crane lorries Mobile drilling derricks Concrete-mixer lorries Other $ 4,500.00 $ 5,500.00 $ 4,500.00 $ 5,500.00 $ 4,000.00 $ 5,000.00 $ 4,000.00 $ 4,600.00 $ 4,000.00 $ 4,600.00 $ 4,000.00 $ 4,600.00 $ 4,000.00 $ 4,600.00 $ 4,000.00 $ 4,600.00 $ 4,000.00 $ 4,600.00 $ 4,000.00 $ 4,500.00 $ 4,000.00 $ 4,500.00 $ 4,000.00 $ 4,500.00 $ 4,000.00 $ 4,500.00 151 | P a g e Fees for Residence Permits, Work Permits Citizenship and Renunciation of Citizenship Appendix VI Temporary Residence Current Proposed $ $ Application fee (non-refundable) non-refundable 150.00 200.00 CARICOM nationals Commonwealth nationals Others Work Permits Application fee CARICOM nationals Others for a period up to 30 days for a period up to 60 days for a period up to 90 days for a period over 90 days up to 12 months Permanent Residence Application fee CARICOM nationals Commonwealth nationals Others per annum per annum per annum 600.00 800.00 1,200.00 1,600.00 1,800.00 2,400.00 non-refundable 150.00 200.00 per annum 720.00 960.00 500.00 700.00 1,000.00 1,400.00 1,500.00 2,100.00 per annum 1,800.00 2,400.00 non-refundable 150.00 200.00 1,800.00 2,400.00 1,800.00 2,400.00 2,400.00 3,200.00 By reason of an Alien Land-holding licence 6,000.00 8,000.00 Citizenship Application fee By marriage non-refundable 150.00 200.00 1,500.00 2,000.00 152 | P a g e By registration Renunciation of Citizenship Application fee Registration fee Replacement fee for all categories of permits/certificates 2,200.00 3,000.00 non-refundable 150.00 200.00 1,800.00 2,400.00 100.00 153 | P a g e Appendix VII Gun License Fees Current Proposed Shot Guns 125.00 200.00 Revolvers and Pistols 250.00 500.00 Riffles 250.00 500.00 Firearms for Watchmen and Security Personnel 250.00 500.00 Dealers in Firearms 1,000.00 1,500.00 Application for Gun License 100.00 154 | P a g e Land Tax Rates of Tax For every block of land in St. Vincent First 10 acres or part thereof next 90 acres or part thereof next 400 acres or part thereof in excess of 500 acres For every block of land in all areas in Bequia, Union Island, Mustique, Petit St. Vincent: First 10 acres or part thereof in excess of 10 acres For every block of land in Canouan First 10 acres or part thereof in excess of 10 acres For every block of land in all areas in Mayreau, Balliceaux, Battawia, Petit Nevis, Savanne and lle-a Qatre First 10 acres or part thereof in excess of 10 acres Appendix VIII Current Proposed $1.00 $2.00 $4.00 $6.00 $3.00 $4.00 $6.00 $8.00 $0.50 $1.00 $3.00 $4.00 $0.40 $0.80 $3.00 $4.00 $0.20 $0.40 $1.00 $2.00 Minimum charge payable by all land owners in the state $10.00 $25.00 155 | P a g e