Articles

Thu 31st Jul 2014

OECS Monetary Council is a failure and a joke

The Monetary Council is the highest decision-making authority of the Eastern Caribbean Central Bank. It comprises eight ministers, one from each of the participating governments. Chairmanship of the Council is rotated among the members on an annual basis.

The Monetary Council has been a failure for the people of Eastern Caribbean States. Having ministers from members states on the Monetary Council means that the council can just influence and approve lending for their own projects, no matter how bad they are.

For the OECS Monetary Council to be effective, its members should not be politicians, but like the Monetary Council of the Bank of England, that is, independent people (not representing individual groups or countries) and each member must have expertise in the field of economics and monetary policy.

OECS countries finances and economies are in a terrible state. The countries have high debt and the countries leaders operate under a 'slave mentality', whereby they exist on begging and borrowing grants and loans from the IMF and foreign countries.

OECS countries have high rates of violent crime, gun crime, rape, high unemployment, high levels of poverty and many thousands of households without water and electricity. It is clear that the economies are failing badly and the Monetary Council can only celebrate decades of failure.

The failure of the OECS economies has been due to the ignorant focus on running the economies on tourism. The failure to build a university in their own country and focus on free university for their people is major factor for the failing economies. Only about 2% of children in the OECS countries go to university, compared to 50% to 70% in richer countries.

The handover of the OECS Monetary Council Chairmanship on 25 July 2014, in St. Vincent, from PM of St. Lucia to the PM of SVG, Ralph Gonsalves, is a big joke.

Gonsalves has been incompetent as the SVG Minister of Finance. Gonsalves failed the Audit of Public Accounts of 2008, 2009 and 2010 and the SVG economy has been mismanaged with massive fiscal deficits for ten consecutive years, 2005 to 2014.

In 2007, Gonsalves overspent by $63 million dollars without the prior approval of the SVG House of Assembly, and in 2008, Gonsalves killed the National Commercial Bank (NCB) with a massive bank overdraft of $185 million. The OECS Monetary Council did not step in and save the NCB.

Gonsalves is not a university graduate in finance, and under Gonsalves, SVG is experiencing its worst economic conditions in 40 years. The fact that Gonsalves is even a member of the Monetary Council, let alone the chair, is a nonsense.

The OECS economies are in an utter shambles. The economies need to substantially reduce their oil dependency, as so much money is wasted buying foreign oil. By going Green and using renewable energy to produce all of the OECS countries electricity needs, these countries could then devalue the Eastern Caribbean dollar to make OECS exports more attractive.

Having the OECS dollar pegged at USD$1 to EC$2.7 overvalues the currency and stifles economic growth in the eight member states of the OECS.

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 believes that the way forward for OECS countries is to follow the model of Singapore. These countries need a new economic model based on science, technology, innovation, small businesses and entrepreneurs, and educating their population to university level. This will create multiple streams of revenue and end the dependency mentality of begging.

Roughly one in every 30 Singaporeans was a dollar millionaire in 2012. It is estimated that by 2017, one in every 20 Singaporeans will be a millionaire. Singapore's GDP per person is the world's highest at $61,567 and the IMF expects this to rise to an astounding $77,000 in five years!

Does Singapore focus on tourism? NO. Does Singapore focus on science, technology, innovation and on educating their people to university level? YES.

Today's world is driven by knowledge, innovation, renewable energy and competent financial management. The OECS Monetary Council is a failure and a joke.

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