Fri 12th Jul 2013

Eastern Caribbean Central Bank 2012/2013 annual report shows that the OECS economic model is a big failure

The OECS economic model is based on the OECS economic union and stabilising the exchange rate of the Eastern Caribbean dollar at EC$2.7 to US$1 at all costs, no matter what.

The OECS economic model is a big failure and the cost to the people of the OECS is too high. All that has been achieved under this artificially high exchange rate regime is high unemployment, weak economies dependent on foreign grants and loans, many small businesses being forced to close down and very high public debt.

The Eastern Caribbean Central Bank (ECCB) has been inadequate in stimulating economic growth and bringing job security to the OECS region.

In its 2012/2013 report, the ECCB pat's itself on the back in saying that levels of liquidity in the banking system have been fairly high. However, how can this be so when in 2008 Gonsalves killed the SVG National Commercial Bank with a massive overdraft of $185 million, and all the OECS countries are heavily in debt and depend upon foreign aid.

Clearly, what the ECCB says about levels of liquidity, is nonsense.

Mr Ivan O'Neal, Leader of SVG Green Party, has a BSc hons in Accounting and Finance from Oxford Brookes University, England, a Masters degree in Budgeting, Macro-economics, policy and planning from Bradford University, England and a Masters degree in Business Administration from Leicester University, England.

Mr Ivan O'Neal strongly believes that we have to take the bull by the horns and restructure our economies and devalue the EC dollar to EC$3 to US$1. The overpriced EC dollar has been a major obstacle in SVG's development and it has stifled economic growth and sustainable development. Devaluation of the OECS dollar is a must.

As a result of the high exchange rate, SVG is being swamped with imported food. In 2011, SVG imported $207 million in food. This money should have gone to SVG's farmers, not foreign companies. We urgently need a strategy for import substitution to severely reduce the amount of food that is imported, to help the local agriculture industry and revitalize the rural economy.

Our economic strategy must be 100% of our electricity needs from renewable energy, create thousands of jobs and create revenue. Our people deserve prosperity.

The creation of a Single Financial Space, as outlined in the ECCB annual report, is not a solution to stimulate economic growth. The OECS model was designed when external grants and preferential trade agreement was the order of play. We have to understand that the days of living off grants are over.

SVG urgently needs a new economic model based on education and science and technology, with free wireless internet throughout our country.

Innovation is increasingly being seen as the currency of 21st century. The future prosperity of SVG in the new knowledge economy will increasingly depend on renewable energy and free internet. This will bring poor families out of poverty.

Today's world is driven by vision and competent financial management. There is no space at the top for incompetence.

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