Fri 19th Oct 2012

Downgrading - is it a Moody's - ULP conspiracy to inflate the need for Argyle airport?

The recent downgrading of SVG to B2 from B1 by the ratings agency Moody's confirms Gonsalves' incompetence in dealing with SVG's finances.

Moody's says that 'prospects for future growth depend critically on improving the competitiveness of the tourism sector and the completion of a new airport'. However, is this not a conspiracy between Moody's and the ULP government to inflate the need for Argyle airport?

Moody's highlights the real crisis with SVG's economy, by saying that our economy relies heavily on tourism. SVG's problem is that any possible yield from tourism could never meet SVG's current expenditure which is $609 million for 2012 (source: SVG Budget Estimates 2012).

The problem in SVG over the last 7 years is that hundreds of millions of dollars have been dumped in to Argyle and there has been no return. The situation is identical to that of the ghost airport in Castellon in Spain. Rather than be the source of SVG's prosperity, tourism and the Argyle airport are the cause of our country's poverty and weak economy.

Spain's Agency for Air Security found that Castellon's runway is too narrow for airplanes to turn around and too short to allow airplanes to safely land, taxi and take off. Castellon airport's runway is 2,700 metres long and 45 metres wide. The Argyle airport runway is 2,743 metres long and 45 metres wide.

Castellon airport failed to secure a civil aviation licence to operate flights and the airstrip is due to be torn up. Argyle airport has the same dangerous flight safety problems as Castellon airport, and Argyle too, will fail to secure a civil aviation licence to operate flights. Argyle's runway is exposed to dangerous perpendicular cross winds.

The unopened £150m airport at Castell'n symbolises ruin and financial mismanagement within Valencia, a region that has seen its banks collapse and its deficit soar. Its debt has been given junk status by ratings agencies. This rating is typically given to debts that are in default and show little prospect for recovery of the principal or interest.

Valencia urgently needs a bailout of £3.5bn. Let us not get to the stage where SVG needs a bailout. SVG needs change now. Castellon airport and Valencia show clearly the route SVG must avoid at all costs.

Castellon airport soaked up money that should have been invested in hospitals, schools and local businesses in Valencia. Argyle airport is doing the same in SVG and blocks the way to a strong economy, prosperity and the creation of thousands of new jobs for our people. We must abort Argyle airport now.

The downgrading of SVG by Moody's and the junk status of Valencia's debt are the clearest signs that SVG needs new leadership and must change course to a Green economy. SVG urgently needs to invest in productive sectors that bring revenue from abroad.

A Green government will invest heavily in education and science and technology, and bring in renewable energy to enable the price of electricity to be cut by 50%.

Our people deserve good jobs and prosperity.

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