7∞4

THIRD SESSION OF THE EIGHTH PARLIAMENT – 2008 BUDGET
PRESENTATION OF HON. ARNHIM EUSTACE

SVG Economic Performance in Relation to the OECS (Domestic Economy)

We have been told or given the impression by the Prime Minister that St. Vincent and the Grenadines’ economic performance was very outstanding in fact we were the best performer in 2006 and with over brighter projections for 2007 – We have been told and the Central Bank confirmed that the economy grew by 6.5% and the IMF said that it grew by 7.0%.

There has been much rejoicing on ULP FM and the Agency for Public Information. The Prime Minister was quick to get into the act. Did all these persons really understand what they were saying? Is this the highest rate of growth this country achieved (insert NDP’s highest rates of growth) what did it do for us? Is the man on the street any better off? Are the poor and the middle class better off? Do people feel better off? If so, why the numerous complaints by our citizens of the hardship that they are experiencing?

Let us look at the facts. On page 11 of the OECS Annual Economic and Financial Review for 2006 “that the average rate of growth for the OECS was 7.1%.” St. Vincent and the Grenadines had a 6.5% growth, therefore that rate is below the average and could not have ……….

Domestic Economy

Who then did better than us? It turns out that Antigua had a growth rate of 11.5% and was far ahead of St. Vincent and the Grenadines. Indeed, their rate of growth was roughly twice ours. And Anguilla at 12.5% was also close to doubling St. Vincent and the Grenadines’ rate of growth. So we in St. Vincent and the Grenadines came in a poor third compared with those two (2) countries.

As far as the International Monetary Fund (IMF) was concerned, we were told by Government that the IMF’s projected growth rate for St. Vincent and the Grenadines was 7.0% for 2006. But the growth rate for 2006 in this country issued by the IMF is 4.1%. Where did the Prime Minister and his Minions like the Press Secretary get 7.0% from? Was it at a Press Briefing and if so, why shortly after the figure was reduced so drastically by the Board of the IMF from 7.0% to 4.1% i.e. by 42% (nearly half the growth rate)? Obviously, the IMF did not think of St. Vincent and the Grenadines’ performance was as good as the Central Bank thought.

(Quote Executive Board Summary)

If we accept the IMF’s growth rate of 4.1%, where does St. Vincent and the Grenadines rank in terms of performance compared with other OECS countries?

Countries
% of Growth
Anguilla
12.5
Antigua
11.5
St. Kitts and Nevis
5.8
St. Lucia
5.7
Dominica
4.6
St. Vincent and the Grenadines
4.1
Grenada
2.1
Montserrat
1.5

Of the eight (8) countries, St. Vincent and the Grenadines will come 6th in terms of growth performance. What is all the boasting about?

Let us now turn to other aspects of our growth performance. Let us look at the selected economic indicators of our growth. It is said that most of the growth in the economy was as a result of construction activity including World Cup Cricket construction for 2006.

How did we in St. Vincent and the Grenadines do compared with the other countries in this area? For the OECS countries as a whole value added or growth in construction in the year 2006 expanded by 15.5%. In St. Vincent and the Grenadines we said our construction sector was doing so great yet, we grew by 6.0% compared with OECS average of 15.5% - Our rate was only 38 – 39% of the OECS rate.

Construction
Countries
% of growth
Antigua
35.0
St. Lucia
25.0
Grenada
15.0*
St. Kitts and Nevis
13.0
Dominica
10.2
Anguilla
8.1
St. Vincent and the Grenadines
6.0
Montserrat
5.0
*Hurricane repairs finished

St. Vincent and the Grenadines close to the bottom again at 6.0%.

Another factor that contributed to growth in St. Vincent and Grenadines was Tourism. The OECS as a whole grew by 6.1%. St. Vincent and the Grenadines had a good year measuring the impact of Tourism hotels and restaurants throughout the OECS countries is used as a proxy for Tourism performance.

Tourism
Countries
% of Growth
Grenada
38.0
Anguilla
20.9%
Dominica
15.0
St. Vincent and the Grenadines
6.0
Antigua
4.0
St. Kitts and Nevis
4.0
St. Lucia
3.6
Montserrat
1.0
St. Vincent and the Grenadines is 4th in the OECS.

Agriculture value added for the OECS as a whole grew by 10.8% for 2006, particularly bananas which grew by 6.4% for the banana producing countries.

Bananas
Countries
% of growth
St. Lucia
13.2
Dominica
7.6
St. Vincent and the Grenadines
-9.3*
· record low for the industry.

For the Agricultural Sector as a whole
Countries
% of growth
Grenada
72.5*
Montserrat
27.4
St. Lucia
12.2
Antigua
2.9
Anguilla
2.5
Dominica
2.3
St. Vincent and the Grenadines
2.3
St. Kitts and Nevis
-14.4**
· after hurricane ** closure of sugar
St. Vincent and the Grenadines almost last tied with Dominica for 2nd to last.

Value added for the manufacturing sector increased by 3.4% for the OECS as a whole.

Manufacturing
Countries
% of growth
Anguilla
6.6
St. Vincent and the Grenadines
5.8
Antigua
5.0
St. Lucia
5.0
St. Kitts and Nevis
4.1
Montserrat
4.0
Grenada
1.0
St. Vincent and the Grenadines is 2nd.

Consumer Price Inflation (or price increases)

OECS as a whole in 2006 was 1.4%

Consumer Price Changes in 2006
Countries
% of inflation
Anguilla
10.0
St. Kitts and Nevis
8.4
St. Vincent and the Grenadines
4.8
Dominica
*1.6
Grenada
1.7
Montserrat
1.0
St. Lucia
-0.6
Antigua
0
St. Vincent and the Grenadines 6th out of eight (8).

In the Economy of the eight (8) OECS countries and looking at the selected economic indicators.

In the growth rate, we came third (3rd) of eight (8) if we use Eastern Caribbean Central Bank (ECCB) figures. If we use the IMF figures we will rank sixth (6th) out of eight (8). In the selected economic indicators we rank sixth (6th) out of eight (8). In tourism forth (4th) of eight (8). In bananas out of three (3) with the lowest record ever in terms of production and earnings. In agriculture tied with Dominica sixth (6th) out of eight (8). In manufacturing we were second (2nd) out of eight (8) and in terms of price increases or inflation we had the third (3rd) highest rate of inflation at 4.8%.

Is that the top line performance we have been hearing about – You would have thought that St. Vincent and the Grenadines was the number one (1) performer in the OECS. The fact remains that we are near the bottom of the ladder must come sixth (6th) out of eight (8) OECS countries.

Yet, the Prime Minister last December in his budget said, “we were on the crisp of an economic take off” – I wonder from which runway he was planning to take off and to go where – was it here?

Tourism Analysis

In the Ministry’s Result indicators for 2006, they projected an increase of 5% in arrivals for the year. In fact the result was 50,000 or 19.7 person increase in arrivals – The Ministry has to be commended. However, of this increase 73% came from cruiseship visitors i.e. 36,000 – This sub-sector however contributes the least in terms of money to the sector. That is why the money we earned from Tourism increased by $25 million or 9%. So although the number of visitors increased by 19.7%, the money we earned from Tourism only increased by 9%. Important as they may be tourism expenditure from cruiseship is not as much as other sectors like stayover visitors or yachting visitor increases.

Out of the 50,000 new visitors 36,700 came from cruiseship visitors which contributed the least to our earnings of all the tourism sub-sectors. That means 13,300 additional passengers came in the stay-over visitors category yachts and excursionists the first two (2) being the most important in terms of money for our economy. So cruiseship passenger did very well. What about stay-over visitors?

Are the cruise ship passengers using the same ferry berth built by the Mitchell Administration – which the ULP criticized so much – I wonder what if we did not have it?

2005
2006

%
95.5
97.4
Up 11.,900
1.9

Now stay-over visitors which is probably the most important category for our economy, only improved by 1.9%. This has to be an area of concentration in the new term we have to improve here. I also note that the Central Bank Report that for the first six (6) months of 2006 this important category of tourists has already fallen from 50.1 thousand to 48 thousand or by 2.1 persons or 4.1% and the main part of the season for 2007 is already completed. So we are not doing particularly well in stay-over visitor despite its importance. The Government must review its strategy. But more importantly in terms of our promotion budget, how did we do in terms of the countries whose citizens come here as stay-over visitors?

Most increased by small amounts in 2006. US visitors were up by one thousand four hundred (1,400) persons, Canadians were up by three hundred (300) visitors, UK up by eight hundred (800) persons, Caribbean territories down by one thousand seven hundred (1,700) and other countries down by nine hundred (900) people – Really small numbers for the most import category. Excursionists were up by about one hundred (100) persons (marginal)

Yachting - The yacht category is also important and shares a very significant increase of 9.7 thousand persons and most of the main expenditure has come from this category and would have made the biggest contribution to the increased tourist expenditure. We would have made more of the $25 million additional earned in 2006 from the yacht passengers than what we made if the thirty-six thousand seven hundred (36,700) cruiseship passengers! There is a lesson to be learnt here. Analyse the tourism budget for 2004 and 2005 with respect to 2006 performance.

We should have made more money with fifty thousand (50,000) additional visitors than $25 million but thirty-six thousand seven hundred (36,700) were cruiseship visitors. Let us look at our tourism performance up to the end of June 2007 as set out by the Eastern Caribbean Central Bank (ECCB).

The Central Bank figures show “that there was a substantial increase in visitor arrivals for the first half of 2007 i.e. thirty-nine thousand four hundred (39,400) that represents a significant increase over the half year 2006 of 22.2%. But this substantial increase in visitor arrivals only led to a 11.5% increase in revenue – This represents a continuation of the trend in 2006 where there are substantial increase in the number of tourists visiting St. Vincent and the Grenadines but because the bulk of the increase came from cruiseship visitors the revenue does not increase significantly. It should be noted that cruise ship passengers amounts to thirty-five thousand one hundred (35,100) out of the increased arrivals of thirty-nine thousand four hundred (39,400) ….” So cruiseship passengers represent approximately 90% of the total additional passengers coming to St. Vincent and the Grenadines in the first half of 2007. Obviously, government promotional strategy is geared too much at cruiseship passengers. Again this is due to the much maligned cruiseship berth built by the NDP.

What is worst is that stay-over arrivals fell just over two thousand (2000) passengers or about 4.1% in the first half of 2007. Stay-over visitors fell although marginally in some cases for all major countries, the USA, Canada and the Caribbean largely due to high air fares. The only bright stay-over spot was for the UK where I believe that fall of US$ against pound made it cheaper for UK tourists. Excursionists also fell by about 22.6%.

The bright spot in the tourism performance in terms of earning money was the increase in yacht arrivals which amounted to an increase of seven thousand four hundred (7,400) yacht visitors. This amounts to an increase of 13% - I know that most of the revenue increase came from the yacht passengers.

In summary therefore whether there has been substantial growth in tourist arrivals in 2006 and the first half of 2007 this was not the case for the 2001 – 2005 period. In 2000, we had two hundred and fifty-six thousand (256,000) visitor arrivals and the ULP government never attained that level of arrivals until five (5) years later in 2005. But despite the significant increases in arrivals in 2006 and the first half of 2007. The level of revenue increase earned by the economy was much lower in fact than the increased arrivals suggested. This can be accounted for by skew-ness brought into the equation by the dominance of cruiseship arrivals in the additional number of visitors. As can be seen from the figures in 2006, of the fifty thousand (50,000) increase passengers (a good performance) thirty-six thousand seven hundred (36,700) or 73% were cruiseship passengers. In the first half of 2007 when there was a thirty-nine thousand four hundred (39,400) increase in arrivals, 89 – 90% were cruiseship passengers. Government has to review this promotion strategy.

Tourism

The data for 2006 for St. Vincent and the Grenadines indicates that with three hundred and six thousand (306,000) visitors for our country, we earned in tourism revenue three hundred and six million dollars ($306 million) i.e. a simple average of one thousand dollars ($1,000) per visitor for St. Vincent and the Grenadines. Of course this figure is skewed by the high percentage of cruise ship arrivals of 73% of total visitor arrivals and a staggering 90% of arrivals in the first half of 2007. This has contributed as indicated above to a large increase in arrivals but a much smaller increase in revenue to our economy and therefore to GDP. It is ironic that the big increases in arrivals about which you are bragging come from the much maligned cruiseship berth constructed by the NDP. Suppose it was not there now we would be having declines in arrivals and the story would have been quite different.

Let us look at two (2) examples in the region to make the point as to why you should review your promotion strategy. Let us look first of all at Anguilla, that country has no cruiseship passengers and compared with Dominica which has a large number of cruiseship passengers.

Anguilla had no cruiseship passengers in 2006. That country only had excursionists and stay-over passengers. What was their performance like? In 2006, Anguilla had one hundred and sixty-one thousand (161,000) visitors and made two hundred and seventy-one point six million dollars ($271.6 million) EC i.e. they made one thousand six hundred and eighty-nine dollars ($1,689) per visitor – no cruiseship visitors. Dominica by contrast had four hundred and seventy-three thousand (473,000) visitors i.e. three hundred and twelve thousand (312,000) more visitors than Anguilla in 2006 but Dominica made only one hundred and eighty-four million dollars ($184 million) in visitor expenditure just three hundred and eighty-nine ($389) per visitor as compared with Anguilla which made thirteen hundred dollars ($1,300) more per visitor than Dominica.

I am not suggesting that we structure our tourism product like that of Anguilla because after all each country has its own resource endowments. But by far the greatest growth in tourism arrivals in St. Vincent and the Grenadines is the cruiseship passenger sector and that in terms of earnings is the sector through which our country will earn the least revenue per passenger. I am not suggesting that cruiseship passengers are not important, but rather than our increase visitor arrivals are skewed heavily to cruiseship passengers and that is why our tourist arrivals increased by 19.7% in 2006 our earnings from tourism only increased by 9%. And the trend continues to be ever more skewed in favor of cruiseship passengers in the first half of 2007 – with 90% of our visitors being cruiseship passengers with a decline in stay-over visitors which is the major revenue earning category.

The Ministry needs to look again at its strategy and the use of its promotion budget and development plan to put greater emphasis on the major revenue earning sector of stay-over visitors and yachting.

For the last two (2) years, I have been saying to the Ministry we need to improve our share of the OECS tourism market for around 8.9% to target say 15% by a specified period. Total arrivals for the OECS was $3.1 million, St. Vincent and the Grenadines was three hundred and six thousand (306,000) or 8.6%. Total earning for the OECS was $3.22 billion dollars, St. Vincent and the Grenadines was $3.6 million dollars or 8.9% - We have remained basically where we were between 8% and 9% of the OECS market.

The words of the Central Bank should be noted by the Ministry of Tourism and I quote “Tourism activity as measured by value added in the hotel and restaurant sector increased by 6%, albeit at a reduced rate compared with growth of 10.6% in 2005. The sub-sectors contribution to GDP declined by 1.0% to 2.1% of GDP – It was 3.1% of GDP in 2005” – Is this really a great performance, the answer is no.

Result Indicators

In the 2007 Estimates, the Ministry of Tourism indicated that it wanted to increase overall visitor arrivals as follows:

Result to June 30th

Stay over
8%
Stay over
4.7 % down
Same day
4%
Same day
19.6 % down
Yacht
15%
Yacht
23.1 % up
Cruiseship
10%
Cruiseship
66.1% up

Analyse above

Another Result indicator of importance:

Result to June 30th

Collaborate with the Ministry of Agriculture to enhance Agro Tourism Linkage to include tours to farms and provisioning tourism establishment.
Some preliminary work has been done, however due to a lack of full participation from all stakeholders, coupled with the availability of funds; it has not been fully developed.

Analyse the above

I note that the Result indicator for 2008 for visitor arrivals. Figures are the same as 2007;

8%
4%
15%
10%

ARE WE SERIOUS?

NATIONAL INSURANCE SERVICES

The International Monetary Fund (IMF) has described the NIS financial position as “weak”. This does not mean that the NIS is now loosing money. But since the NIS is responsible for our people’s pension for many years down the road. It is important to understand that given the fact that our population is very young with more than 50% under twenty (20) years old and with our rates already low we are not building up sufficient reserves to cater for the future. When those who are so young reach retirement age you will not have reserves to continue to pay people. In addition, we need to make much more money from investments in order to help build up reserves. Other wise, in the long tern the NIS will not have enough to pay people’s pensions.

In the Actuarial Review that was done in 2005 it was projected that after the year 2012 a mere five (5) years away that contribution income i.e. the amount of NIS paid by workers and employers into the Scheme will not be sufficient to cover the NIS pensions payment and other benefits as well as staff salaries etc. This will mean less income for the NIS and the reserves will begin to fall.

Estimates of the net present value of future income and expenditure shows a net implicit liability of 12% (twelve percent) of GDP. All this means is that it will cost 12% of GDP or about $128 million – But the NIS is long term service to the people and the IMF has done the calculation that says that over the long term say sixty (60) years you will need what we now have as GDP i.e. $1,064 billion to meet the costs of pensions and other expenses of the NIS.

These figures are staggering. It means that rates have to go up soon to forestall any financial collapse it has been calculated that the contribution of employers and workers to the NIS will have to go from six percent (6%) to eleven percent (11%) over the next few years, but the government needs to tell the public this. Well St. Vincent and the Grenadines at six percent (6%) has boasted that we have one of the lowest rates of NIS payments in the region.
Let us look at some of the rates.
Regional Contribution Rates

Countries
% for Worker
% for Employer
% for Total
Antigua
3.0
5.0
8.0
Dominica
3.0
7.0
10
Grenada
4.0
5.0
9.0
St. Kitts
5.0
6.0
11
St. Lucia
5.0
5.0
10
St. Vincent and the Grenadines
2.5
3.5
6.0
Barbados
7.75
8.5
16.25
Jamaica
2.5
2.5
5.0
Trinidad and Tobago
2.9
5.8
8.7

So, only Jamaica of the nine (9) countries surveyed has lower contribution rate than St. Vincent and the Grenadines.

To continue the solvency and integrity of the Scheme, the public will face higher contribution rates over the next few years – i.e. rates almost twice as high if the Actuarial Review is adopted by government. – Again, government needs to say so.

A number of other ideas to improve the long term financial viability of the NIS and ensure that people get their pension in the long run are being suggested. These include raising the retirement age – so that you retire later and therefore receive your pension later but you would also pay more contributions.

Altering the investment portfolio with a view to earning more in NIS investments could be dicey as it means doing more investments outside of St .Vincent and the Grenadines – here in St. Vincent and the Grenadines, you are limited mainly to Public Sector Investments e.g. government bonds and many have helped to lower the cost of borrowing and this reduce the income of the NIS.

A suggestion had also been made to do away with the Civil Service salary – and we all know the history of that. It is also very important to note that about twenty percent (20%) of the bank deposits in this country come from the NIS reserves. Twenty-five percent (25%) of the banks lending is to the public sector but there are risks associated with that, it goes back to the issue of the investment portfolio and the extent to which the policy could be varied to facilitate a wider regime of investment opportunities.

THE PUBLIC DEBT

The public debt of St. Vincent and the Grenadines as of September 31st 2006 was estimated at $1,064,000. Amortization for the year commencing January 2007 was estimated at $47.4 million while interest payments were estimated at $46.5 million. So $93.0 million would be invested just to service the debt in 2007. There were no payments to service the Ottley Hall debt.

As at September 2000, the total debt was $564.0 million including the Ottley Hall. By September 2006, the debt had increased by $495.0 million dollars and the payments to service the debt had double from $46.5 million to $93.0 million. So there has been a rapid accumulation of debt with payments doubling in a six (6) year period. – ULP callousness.

The ULP government’s stated strategy is to get debt to GDP ratio down to 75% in the medium term. But given there attitude to expenditure and the penchant for putting up large infrastructural projects in the capital program – and even with the Ottley Hall debt forgiveness, the debt will still accumulate just because of the airport and the cross country road unless these projects are financed by grants and very soft loans.
QUOTE page 13 and 14 of 2006 Budget reply.
“Public Debt
[Strategy in Manifesto]

Mr. Speaker, much has been said and written about the worrying escalation in the public debt of this country. As usual, the Prime Minister is giving an exposition which is all too familiar ….. Ottley Hall …. Ottley Hall …. Ottley Hall. Mr. Speaker, I have said before that if the government perceives it has something to fix on the Ottley Hall project then it should do what it has to do…. But in the meantime it is utter nonsense to refuse to make the necessary interventions to put people to work. The project always had and still has the potential to be a first class marina. What could be so wrong in ensuring that the affairs of the facility are arranged in a manner which could put Vincentians to work? The money spent on the enquiry could have gone a long way in improving the livelihood of a few Vincentians.

Let us not forget that hundreds of Vincentians were trained in Italy, many of whom have since sought employment elsewhere whilst there are others up to this day still without a job for which they have been trained. Mr. Speaker, I wish to make it abundantly clear that I am not opposed to any enquiry the government wants to undertake in this matter neither am I defending any allegation of wrongdoing. All I am simply saying is that the government needs to abandon its backward approach and to be more proactive and positive in its outlook. Get people to work! I am quite sure the Representative for West Kingstown is not opposed to this view.

Mr. Speaker, the Honourable Prime Minister has spoken about the Public Debt of this country in a way which will make any fool feel that the ULP is no way responsible for the spike in the public debt of this country. It is absolute rubbish to list projects implemented by the NDP government over a period of seventeen (17) years to try to absolve him and the government. Mr. Speaker, his approach is child’s play …. quite contextual in the way he handles the nation’s affairs.

Mr. Speaker, the truth of the matter is this: the stock of debt accumulated by the NDP in seventeen (17) years pales in comparison to the debt rattled up by the ULP in less than five (5) years. The rate of debt accumulation by the ULP is just frightening to say the least. In 1984 when the NDP took over the reigns of this country, the debt stock stood at $181 million. At the end of 2000, the stock of debt was just over $560 million, including Ottley Hall. A net amount of just around $371 million in seventeen (17) years. An average of about $21.2 million per year. Between 2001 and September 2006, the debt stock has risen to $1.62 billion, a net amount of around $502 million. An addition of $100 million per year. At this rate, the national debt of St. Vincent and the Grenadines must be the fastest growing global phenomenon. The ULP government Mr. Speaker, is increasing the debt of this country five (5) times faster than the rate of debt accumulation under the NDP in seventeen (17) years … INCLUDING OTTLEY HALL. Mr. Speaker, it is irresponsible, imprudent and a grave injustice to the future generations of this country. Theirs will be a life of suffering since a significant proportion of the countries’ resources will be utilized to service the loans contracted irresponsibly by this wicked ULP government.

Mr. Speaker, not even the devastation wreaked by Hurricane Ivan in Grenada caused a debt accumulation of this magnitude. Mr. Speaker, what we have here is a disaster of immeasurable proportions. It is high class treason …. These are the actions of a political and economic prostitute.”

Mr. Speaker, that was a direct quote from my Budget reply last year. Mr. Speaker in the same reply last year
….QUOTE 11 and 12.

Now Mr. Speaker, the IMF has reviewed our performance for the year 2006 and is saying to the government of St. Vincent and the Grenadines if you continue to accumulate debt at the current rate within a two (2) year period you will not be able to pay your debt because the interest and principal payments will be too high. This means that a larger and larger portion of our revenue will be needed to pay the debt.

This means that this will be less revenue to pay for public assistance and other poverty reduction measures for the poor, less money to pay salaries and less money to avail for health care and education etc. The fiscal situation will continue to deteriorate. The net result of this says the IMF and I have been warning the government about this situation since Budget 2005, that you will have to cut back expenditure. The IMR has recommended that if you don’t take corrective measures now, in a couple of years you will have to cut back the public service. I believe that why the IMF chose the public service is that wages and salaries represent about fifty-one percent (51%) of the total expenditure i.e. the largest component of expenditure. Take for example – in the Estimates for 2007, wages and salaries, pensions and NIS amounted to 56% of expenditure.

If you take away the pension and include government contribution to NIS for Civil Servants we’ll go over 50%. The next item is goods and services which is estimated at 82.5% which represent 21% of expenditure. This money is used to buy goods example supplies for schools, drugs and other supplies for the hospital and the district clinics. Can you cut that it is already small. The next highest category is payment of is payment of interest and you can’t cut that so because of their responsible behavior over the last few years with regard to expenditure both recurrent and capital between a rock and a hard place – i.e. where to cut.

The IMF is the premier multilateral international financial institution in the world. It is saying to the Ralph Gonsalves government – you have done wrong with government’s finances. You have allowed the debt to mount up to unsustainable levels and it in two (2) years will actually surpass the GDP i.e. be over one hundred percent (100%) of GDP. The IMF also says that your expenditure is growing too rapidly – So it is time to take stock. The advice on that Is what is based on economic and financial principles – It is no point describing their advice as “rubbish” or saying that the IMF staff getting their salaries and comments of that sort because they don’t do anything to improve our position and make It easier to deal with our problems. I am sure those in the Civil Service who have knowledge of the economy understand why the advice was offered – It is for the government to make an effort to see how best we can deal with this matter with less pain for our people.

It was for the same reason that some years ago I did not agree to a 30% increase so that our expenditure would not run away and place us in a position to have an IMF Structural Adjustment program. At that time I was being told by the public Service including the representative for Central Kingstown that Dominica had higher salaries than us. I said then that Dominica would pay the price later and so they did. They had to go through a rough structural adjustment which many Civil Servants suffered. Is this what we want for St. Vincent and the Grenadines?

The government of St. Vincent and the Grenadines will have to be careful with its expenditure projection for Budget 2008 and 2009.

Government without cutting the Public Service will have to cut out wasteful expenditure – all this food and snacks at every little government function lasting a few hours, all the political contracts given out to supporters e.g. Sir Vincent Beache, Juliet George, Edwin Snagg, Elson Crick, former Commissioner William Harry, Burns Bonadie, Belmar, Casper London and others. Some of these have retired and collects both pension and gratuity and some do no real work at all.

I would not be the least surprised if these post costs close to $100,000 dollars per month or $1.2 million dollars per year – This can be saved. More effort has also to be made to stamp out corruption in the Public Service especially in contract work. There aren’t saving avenues there. There are too many boards and statutory bodies in this government. Some are not needed. Government must begin to address these issues.

VALUE-ADDED-TAX (VAT)

Mr. Speaker, I wish now to spend some time talking about VAT. This is a tax measure more than any other tax measure that has generated enormous discussion in St. Vincent and the Grenadines; before and more so after its implementation. The New Democratic Party understood the need for a Value Added Tax and felt that it should be supported.

What was the genesis of the VAT? Given Mr. Speaker the increasingly globalized nature of our economies and particularly the liberalization of through the introduction of free trade areas, the need to be more competitive. It was obvious that rates of import duty and other such imports were falling. Even today as we discuss EPA, we find that the European Union would wish a lot of their goods to come in St. Vincent and the Grenadines and other ACP countries free of duty – It is part of the global trend. So duties could continue to fall. Since in many of our countries forty to sixty percent (40 – 60%) of government’s revenue is collect at the Customs, this new trend will mean that government’s revenue would fall over time and they will not be able to provide the various services that government’s normally provide like health, education, roads etc. They will not be enough money to go around. So the Value Added Tax was introduced to be able to stem the loss of revenue – but at the same time Consumption Tax and some other relatively minor taxes would be removed.

But we all knew that VAT was a very regressive tax that is unlike Income Tax the rate is the same whether you are rich or poor. So in order to cushion the blow on the poor and the middle class, government need to exempt some items from VAT by charging a very low rate or a zero (0) rate hence the term Zero-Rated.

When the Opposition members on the Select Committee met with government members we did not like many of the proposals as they related to the implementation of VAT. We did not feel that VAT’s impact on the poor was given sufficient consideration. We did not feel that enough time had been given to dispose of old stock and we felt that given a VAT rate of fifteen percent (15%) it was likely to be inflationary.

The ULP government was of a different view. They wanted VAT on electricity above fifty (50) units – we felt that electricity should be zero, they wanted VAT on water – we felt no. But most importantly the ULP government wanted to put VAT on a lot of basic items “like food” which we thought would create hardship and in addition would be inflationary. A lot of basic food items before VAT had low rates of Consumption tax like five and ten percent (5 and 10%) – now they were at fifteen percent (15%). We are of the view that implementation of such rates on a lot of basic items was committing a crime on the poor and those with incomes less than fourteen thousand dollars ($14,000) per year.
Therefore when the VAT Bill went to Parliament the Opposition members voted against it.

The levels of poverty in our country are too high. Our position remains the same: As for the question of inflation, we are told that the increases in prices at the supermarket have nothing to do with VAT, it is due to gouging (that is nice – which really mean that supermarkets ripping us off). We are also told that it’s due to international inflation but that it is not due to VAT. I want to pint out the following: In the first four (4) months of 2007 i.e. the four (4) months immediately prior to VAT which came on 1st May the fifth (5th ) month that the rate of inflation of St. Vincent and the Grenadines averaged about 4.3 – 4.5%. But in the next month it jumped to a rate of about eight percent (8%) per month. I need no further evidence, I am not saying that all is due to VAT – because I know that there is always inflation. But to exclude VAT from the calculation and blame it on the supermarkets is unbelievable.

The government has implemented VAT to raise revenue and they want to raise more from VAT than they did from the other taxes like Consumption taxes. How much have they raised so far. If you look on page 92 of the Estimates you will see in the Result indicator for the Ministry of Finance, you will see the following cryptic comment. “VAT successfully implemented from May 2007. Collection up October including the increased Excise taxes which were brought in with VAT is $70.27 million dollars. So in six (6) months they have collected $70.2 million dollars i.e. $11.7 million dollars per month.

So the administration in the first six (6) months of VAT has collected $11.7 million dollars per month. They did not give the figure for what is additional. The New Democratic Party is adamant that in the interest of particularly the poor people in this country that several items must be zero-rated. No VAT
Put in list and expand.
VAT should have been implemented with a framework of general Tax Reform.

The International Monetary Fund (IMF) in its Report recognizes that the government fiscal situation is bad and that they need money, so they are urging the government not to succumb to the pressure to make more items zero-rated. So that there is no doubt let me quote the IMF Report on page 15 and paragraph it say “staff urged the authorities to stand firm against pressure to increase the list of products and exempted or zero-rated under the VAT. Yielding to these pressures would increase the administration burdens, erode the tax base, distort incentives in the tax regime and complicate compliance.”

They are saying to the government “donot follow Eustace and the rest of the NDP.” I say to IMF I donot agree with you too many poor people are suffering in this country. Too many poor people are getting embarrassed at the supermarket counter on having to leave back items that they took from the shelf but cannot pay for. Too many poor people often donot have a meal to give their children. Too many poor people have their electricity cut off. Too many poor people can’t take the pressure no more. Wake up Prime Minister! Wake up!

CRIME

Mr. Speaker I now turn to crime. Never before in the brief history of this country have we ever experienced the type of criminal activity that is now pervading our society. Mafia style executions are being carried out with impunity - drugs are being discovered frequently on land and in the sea - burglary, theft and robbery are still creating serious concerns - police brutality is becoming more rampant - rape is now so prevalent that it was championed as one of the reasons for the closure of the Kingstown Medical College in Ratho Mill - gun crimes are reminiscent of the ‘wild wild west’ and our poor impressionable school children are constantly carrying deadly weapons to school and on occasions have used and threatened to use those weapons against their school mates and teachers. It is against this backdrop that our people are living in fear- fearful of losing their jobs, fearful of their lives and their properties and fearful of losing their loved ones.

Mr. Speaker, the ULP Administration must not only shoulder the responsibility of averting such criminal conduct, they must also accept blame for the current spate of criminal activity in this country. During the general elections campaign they promised to be tough on crime and tough on the causes of crime – a slogan that they borrowed from the Labour Party in the United Kingdom. But it is obvious Mr. Speaker, that they have neither been tough on crime nor on the causes of crime. Once again they did not honour their promise to the people of this country and should accordingly accept the blame for the wanton killings and apparent lawlessness that are evident in the country. Mr. Speaker, the ULP Administration has constantly boasted about being the best at this and the best at that – a revolution in this and a revolution in that - what they have yet to acknowledge is the current revolution in the gruesome criminal activities that we have been experiencing on a weekly basis over the past five years. If there was a reduction in the level and type of crimes committed in this country, they would have taken credit for that- they would have in their usual style been making public pronouncements about a revolution in crime prevention and crime reduction. Therefore Mr. Speaker, in the light of the fact that they have failed to keep their promise to be tough on crime and the causes of crime they must be prepared to accept the blame for the unacceptable criminal activities in this country.

Mr. Speaker, since 2001 when the ULP took power, the violent crimes being committed in this country have become more gruesome than in previous years. The number of murders committed has been steadily increasing. For the year so far, over 32 persons have been murdered and although it is not my wish, I have no doubt in my mind that there will be more murders before the end of this year. What is however alarming is the crimes that are being committed as a result of drug trafficking and drug abuse. The number of drug crimes that were reported every year from 1992 to 2005 represented approximately 5 % of all the crimes that were reported during that period but from 2006 there was an increase to 6% and up to September this year (2007) 7%. However Mr. Speaker, it is important to note that the number of drug crimes reported does not truly represent the impact of drugs in this country. It does not show the crimes such as robbery, burglary and theft that are committed by drug addicts to feed their drug habits- it does not indicate the level of violence against other persons when under the influence of drugs and it certainly does not relate to the murders that are committed by gangs for the preservation and the maintenance of supremacy over what they consider to be their territory.

The drug situation in this country is getting out of control. Over 2000 of our young able bodied men and women have taken to the hills in such arduous mountainous terrain in search of alternative and unlawful employment. This very government that boasts about its education in revolution and its youth employment scheme has still not done enough for the young people in this country. It is true to state that drug trafficking is a lucrative past time- but it is equally true to state that our young people are risking their lives on a daily basis in the terrible weather conditions and the roughest of terrains to earn a living from drug trafficking. Many are being shot and otherwise killed on the high seas, some have been captured and imprisoned in other islands and others live in fear with the passing of each hour that at anytime they could be arrested and imprisoned for their involvement in illegal drug activities or even killed by members of a rival gang.

Do you Mr. Prime Minister honestly believe that many of our young healthy men and women rather risk their lives in such deplorable circumstances and conditions than be provided with gainful and lawful employment? Where is the alternative? These young people are the future of this nation- they are the nucleus of the fabric of our society- they are the heart, sole, body and mind of the nation – they are the beneficiaries of our tenure as politicians and leaders of tomorrow – they are the pillars of this country’s future success as a nation. Mr. Speaker, we currently possess the minds, the eyes, ears, hands and feet that will teach them to turn away from the path to destruction and lead them into the right direction. The question still remains – what is the government doing to create a lawful and meaningful alternative? The answer continues to be, very little. But much can be done if the government really cared. The experience that they gained in the hills can certainly prepare them for a bright future in agriculture and other fields of endeavour. Much of our food is imported. At times there is a serious shortage of vegetables in this country even though we are endowed with the treasure of fertile soil. This provides a golden opportunity for the government to create the avenues and to put in place the necessary facilities to accommodate the agricultural, administrative, financial and marketing skills that these young people honed during the turbulent years in the hills. This approach is not new and in the early 1990’s achieved a satisfactory level of success in Peru where the coca farmers were offered alternatives which resulted in the reduction of the number of coca plants that were produced in the Upper Huallaga Valley. This had the effect of reducing the amount of cocaine that was produced in that country and forcing the drug lords of Columbia to increase the growth of the coca plant in Columbia. Bolivia also achieved a measure of success with its crop substitution and drug eradication programmes even in the face of stiff opposition from its coca farmers. Unless the young people of this country can see some hope in this administration the law enforcement institutions can expect greater difficulties in the administration of justice.

Mr. Speaker such difficulties are currently looming on the horizons. Just when we thought that marijuana cultivation was too hazardous an activity for our young people we are currently being overwhelmed with the high incidence of cocaine entering our waters and our shores. The amount of cocaine that enters this country has gone far beyond our wildest imaginations. Mr. Speaker, almost every week there is some form of criminal activity that is conducted which unfortunately relates to cocaine. Latin Americans, particularly the Venezuelans are constantly being apprehended in our waters travelling on vessels that are laden with cocaine. Our Coast Guard is constantly on alert and has on several occasions had to engage in gun battles with drug traffickers to deter drugs from entering this country. Yet we still have to ask the question – how successful have they been in those drug interdiction encounters? Mr. Speaker how much cocaine has enters our country is still every body’ guess. What we do believe, however, is that cocaine is not produced in St. Vincent yet it is creating a drug and gang culture very much akin to that which exists in Latin American countries, including Peru and Columbia. If we allow that culture to grow and expand the drug lords will be ruling this country and heaven knows what will become of our people.

Already we are experiencing gang warfare and ‘tit for tat’ shootings and killings - assassinations are being ordered and executed without regard for human life and the existence of law enforcement authorities. If the ULP Administration does not move swiftly to arrest the situation we will all live to regret the legacy that we have left for future generations. Our beautiful little country must not become another Columbia of the 1980s and 1990s. Many of us could recall the power that drug lords and drug cartels exercised on successive administrations and the law abiding people of that country. We must all be reminded lest we forget the unthinkable incident which occurred in Columbia on 6th November, 1985 when M-19 Guerrillas which were paid $1US million by the Medellin Drug Cartel of Columbia stormed the Colombian Palace of Justice and took 250 hostages. They killed ninety-five of the hostages including eleven of the 24 Judges to force them into making a declaration that the Extradition Treaty which permitted the extradition of Colombian drug lords to the USA, was in effect illegal. Mr. Speaker during that period, judges and civil servants were forced to take bribes and consequently to rule in favour of drug traffickers or be killed if they refused to accept the bribes. Over 1000 public officers were assassinated, 3 presidential candidates, an attorney general, 12 supreme court judges, more than 50 judges of the lower courts, over 170 judicial employees, a narcotics chief of police and several journalists. But the killing still continued when in 1989 the late and infamous Pablo Escobar ordered the bombing of a Colombian airliner killing all 107 passengers aboard. It was as a result of such huge human sacrifice that the Columbian officials abandoned the extradition efforts with the USA. I do hope that this timely reminder of what can happen to this country if we harbour a drug culture will be ever present in the minds of those who contemplate granting pardons to drug traffickers and those who are responsible for the Alex Lawrence Affair.

Mr. Speaker drug related activities come with a very high price. Both the drug abuser and drug trafficker are essentially great burdens to society. The drug abuser will always seek to satisfy his or her addiction on a regular basis. To do so Mr. Speaker requires a substantial amount of money and for the most part the drug abuser usually requires more than his income in order to satisfy his habit. It is for this reason Mr. Speaker why the drug abuser becomes a beggar or steals, robs or burgles in order to get money to buy illegal drugs. The stealing may start in the home and this will undoubtedly create an annoyance to other members of the household and eventually a strain in the relationships. This creates further hostility and at times an acrimonious disintegration of the family structure. When stealing at home becomes difficult drug abusers turn their attention to other people’s properties elsewhere. Some have even been using their bodies sexually to satisfy their drug habits and this in itself exposes them and the wider society to the HIV virus.

Mr. Speaker the problem with drug abuse is the deleterious effects that it has on the human minds. The number of persons wandering the streets throughout the length and breadth of this country, searching garbage bins and apparently existing on planet mars has reached immeasurable proportions. In 2003 over 180 persons, including 138 men and 43 women were treated for drug abuse at the Mental Health Centre. But there are many more Mr. Speaker, who, in spite of their ‘ivory tower’ existence, are too consumed with pride to seek medical attention. Of 181 who sought and received treatment in 2003, 71% were under 40 years of age, 41% under 30 and 14% under 20 years old. It is therefore clear Mr. Speaker that our young men and women of working age and in the prime of their lives are being treated for mental illnesses that are induced by drugs. This, Mr. Speaker, is a necessary burden on the finances of this country - one that we can ill-afford and one that could have been avoided if the economic and social climate in this country was conducive to the young. It leaves us to wonder whether drug related illnesses are seen as part of the ULP Administration’s wellness revolution.

Mr. Speaker, even the mighty economic giant, the USA is finding the implications of drug abuse a very heavy toll on that country. Reports indicate that about 16,000 citizens of the USA die every year from the consumption of illegal drugs. To deal with the illnesses, crimes and deaths that are drug related the USA has been forced to incur a cost of over $US67 billion. Mr. Speaker, the government is required to do everything in its powers to stem the flow of drugs in this country.

It is however, abundantly clear that the government has done very little to arrest the drug situation. There have been occasions in which substantial amounts of drugs were discovered but no one was apprehended. Drug traffickers have become so bold, powerful and authoritative that they are refusing to tolerate any competitor who is not prepared to co-operate. They have been shooting, wounding and killing with impunity and they attract most of the attention of law enforcement authorities to little or no avail. They have very little or no respect for the police so they conduct their drug trafficking business in the public at all hours of the day and anywhere that is convenient. Whilst so doing, they proudly and bravely engage in the usage of drugs, caring little about the identities of passers by. Mr. Speaker drug traffickers are gaining strength and ascendancy in this country and the law abiding citizens are living in an environment of fear.

In this presentation, Mr. Speaker I have decided to emphasised the evils of drugs on this country because we are extremely concerned about the effect it is having on everyone. Drug trafficking is a lucrative business and it is global. The estimated profits from its USA and European operations have been reported to yield $US232,115 per minute. Research has shown that the annual revenue from drug trafficking was approximately $US400 billion. What is even more alarming Mr. Speaker, is that research has also indicated that there are about 400 million regular customers worldwide. The success of drug trafficking hinges on its demand and the ineffectiveness of drug interdiction programmes. Once there is a demand for illegal drugs, traffickers will stop at nothing to satisfy that demand. Therein lies our problem. Mr. Speaker, it has been estimated that every year $US200 billion worth of illegal drugs enter the USA market. Clearly, Mr. Speaker, the USA is the world’ largest consumer of illegal drugs. It has been reported that 99% of the cash that circulates in the USA is tainted with cocaine and 90% of that which is circulated in London, England is tainted with illegal drugs. Mr. Speaker, it is as a result of this huge demand for illegal drugs and this country’s relative geographical proximity to the USA, coupled with its historical connection with Great Britain that drug traffickers find it necessary and convenient to use our pristine clear waters to tranship illegal drugs to those countries. Similarly, Mr. Speaker, we are an archipelago of islands with many bays and cays. It is therefore very difficult to effectively police our waters and relatively easy for drug traffickers to ply their iniquitous trade without recrimination.

Mr. Speaker, the stresses and strains of our day to day lives can significantly influence the manner in which our families exist today. The home, the schools, the churches and the communities are all foundational institutions in which our children at a very early stage in their lives begin to appreciate right from wrong, good from bad and righteousness from evil. It is however, in the home that good citizenry, a respect for the lives and the things of others and an undying love of God and Christian principles are initially inculcated. But are those parents in a position to instil into the hearts and minds of those young and tender children the virtues of love and respect for the law, when for the most part they are out toiling to provide for their children their daily bread? Many families are single parents upon whom those children depend for their survival and livelihood. Mr Speaker, when the parents are at work many of those children are left on their own to do whatever they desire.

With the reduction in agriculture and the drift towards areas of employment many families are now forced to live apart from each other. Therefore, unlike in the past where the grandmother or auntie or cousin were around to care for those children in the absence of their parent such care in a family structure is hardly in existence today. In situations where families live in close proximity to each other those who may be willing to help may well be experiencing similar problems of their own. Mr. Speaker, it is against this unfortunate background that individualism begins to grow. In other words the very fabric of our family structure is beginning to disintegrate into a syndrome of ‘to each his own’ – the result of which we experience in the forms of deviancy, delinquency and truancy among our young children. Mr. Speaker it is in such a setting that criminogenic factors are germinated and criminal conduct eventually takes control.

The evidence of such an analysis is reflected in the disproportionate number of young people that are convicted of criminal activity and are imprisoned annually. For example, on average, persons under the age of 25 years of age have been charged with approximately 35% of crimes that are committed annually. Those between the ages of 26 and 30 are also charged with approximately 24% of the crimes and on average 17% of crimes are attributable to persons between 31 and 35 years of age. In essence, over 75% of the crimes that are committed annually are attributable to persons 35 years and under. It is therefore not surprising Mr. Speaker that approximately 75% of the persons that are committed to prison each year are under 35 years and of that amount 19% are under the age of 25 years.

Mr. Speaker, if the ULP administration really intended to be tough on the causes of crime, why have they not taken adequate steps to improve the livelihood of the young people of this country and turn them away from a life of violence and crime? It is true that the churches have a role to play in the prevention of crime but how can the churches reach out effectively to a group of young people with the hope that they will pay attention to the word of God when they are totally disgruntled, perplexed and disappointed with the ULP Administration? How can teachers instil into the minds of those young children the virtues of being good law abiding citizens in situations where little support for similar values is nurtured in the homes? How can law enforcement officers grapple with the pervasiveness of crime with so little or in some instances no adequate resources at their disposal? The question still remains, what is the ULP administration doing about crime in this country?

Mr. Speaker they established the Rapid Response Unit, in the Police Force. This Unit is affectionately known as the ‘Black Squad.’ Its main purpose is to ensure the effective enforcement of the law. They instituted the Serious Offences Court to deal expeditiously with persons alleged to have committed serious criminal offences. A Crime Commission was also established, presumably for the purpose of increasing the awareness of crime prevention measures and a new prison is being built to ease the congestion at Her Majesty’s Prison in Kingstown and most recently they enacted laws to effectively deal with persons who steal the agriculture produce and live stocks of others. Mr. Speaker, although those steps may be seen by some as commendable, their main focus is predominantly on law enforcement and not sufficiently on ascertaining the causes of crime. They, for the most part focus on how to deal with the offender but in essence, they do very little for and say very little about why people commit crimes.

Mr. Speaker the removal of the provisions of the Police and Criminal Evidence Act from our laws is not considered to be a step in the right direction. The Prime Ministers’ advice to the police not to read the beatitudes to persons suspected of committing criminal offences is also counterproductive. Mr. Speaker such advice has the effect of encouraging police brutality which we are now experiencing on the increase. Rather than modifying PACE to accommodate our circumstances and teaching the police how to apply PACE in a practical way, the ULP Administration without giving much thought to the implications of its removal, hastily repealed the provision in our law which incorporated PACE, thus effectively repealing PACE and giving unto the police the freedom to infringe the rights of others. This raises the question Mr. Speaker, how will the police solve crimes expeditiously if the very people from whom information is required to secure convictions are being harassed and brutalised?

Therefore Mr. Speaker, how can the ULP be tough on crime and tough on the causes of crime when they make little or no attempt to determine why people commit crimes? Mr. Speaker this is the only way that we can begin to deal effectively with the current spate of criminal activities that have severely tarnished the landscape of this country. We need to utilise the information that is available and improve our reporting mechanisms in order to provide that which is necessary for policy makers to be able to make informed decisions on the most effective and desirable way of tackling crime in this country. Mr Speaker, if we do not address the issue of crime in a prompt, efficient and more meaningful way foreign investors and tourists alike will avoid visiting this country for a long time to come.

Mr. Speaker, it is not sufficient just to increase the numbers in the police and to provide better equipment and other services. Here we are looking at the corrective side of crime and punishment for crimes committed that is all well and good. But the NDP believes that we have to go much further on the preventative side.

We are of the view that much of the crime stems from the decline in moral values in our society. Our society Mr. Speaker has been subjected to many influences which have undermined those values that we once hold dear and loved by. Our economic fortunes have not helped either. I have already spoken about the role of illegal drugs and our youths.

In 2003, Mr. Speaker the Opposition brought to this Parliament on the one sitting of the year when Opposition business (private members business) takes precedence over government’s business until 5.00 p.m. on that particular day, we brought what we called “the Spiritual and Social Redemption Charter” to the Parliament for consideration. The Charter is aimed at reducing the level of crime among our youth in particular by providing support to a number of institutions and organization which are organized to teach and expose more of our young people to positive values particularly our Christian principles.

We are also of the view that the economic circumstances of many of our poor and unemployed youths leave them preoccupied with making a living i.e. certainly one of the causes for the growth of the illegal drug trade in St. Vincent and the Grenadines.

Let me read the preamble to the motion that we brought before the House and which we think is even more relevant today.

“Whereas over the last few months, St. Vincent and the Grenadines has experienced an unprecedented series of heinous and barbarous crimes contributing further to a veritable climate of fear throughout this otherwise blessed land of ours;

And whereas this trend has affected the lives of all Vincentians resulting in a large number of our potentially productive young people being lost to crime as can be evidenced by the number of youth in our prison population, the spiraling number of “homeless youth” roaming the streets of Kingstown and the creation of neighborhood watch societies in several communities;

And whereas there is an insufficient number of rural libraries and like facilities, an absence of a girls’ home, to complement the Liberty Lodge Boys’ home, an inadequate number of rural counseling centers and an absence of a scientific approach to dealing expanding local and domestic security;

And whereas this unsatisfactory state of affairs has been acknowledged by the Media, Civil Society and the Human Rights Association as manifested by their editorials, statements of condemnation, calls for marches of peace and a request for a return to more Christian values and the need to be “our brother’s/sister’s keeper”;

And whereas this prevailing climate now sustains an environment of uncertainty, despair and unlawful conduct which threatens the best of our democratic traditions, constitutional privileges and a reasonable sense of decency;

And whereas given the impact of foreign cultural penetration on small developing countries like St. Vincent and the Grenadines, the state has an obligation to reinforce the family unit and specifically the basic role of parents in the upbringing of children by a sustained and relentless education initiative for the development of spiritual, ethical, moral and human values through social, cultural and economic interventions;

And whereas it is universally accepted that there is an undeniable link between the levels of crime and depressed economic conditions and that the issues of drug trafficking, drug use and drug dependency along with poverty alleviation loom large and require the utmost priority;

And whereas Government spends over $13,000 per annum to maintain a prisoner in the main correctional institution and only $5.00 on a Girl Guide or Boy Scout (at an organizational level as evidenced in the estimates) among youth who comprise the standard bearers of discipline for a kinder, gentler St. Vincent and the Grenadines;

And whereas the potential for development of the criminal instinct is highest in disadvantaged, homeless and orphaned youth, - male and female, - it is imperative that the State complements the existing Liberty Lodge Boys Training School with a counterpart female institution, introduce truancy officers in the several constituencies, towns, villages as appropriate to back up a compulsory education initiative while the Ministry of Gender and Social Affairs is charged with the responsibility for tracking homeless and orphaned children and aiding in their rehabilitation.

Be it resolved that this Honourable House support a motion to be called: THE SOCIAL AND SPIRITUAL REDEMPTION CHARTER (outlined below) giving tangible effect to a national commitment to a just, equitable, confident, fearless, respectful, proud and God-fearing people by providing resources, giving leadership, employing social and economic strategies to reduce the intolerable violence, providing hope for the Vincentian aspiration, tolerance for divergence, love and respect for the dignity of human life and our commitment to the Supremacy of God in all we say and do in building the kinder, gentler society for the 21st Century.”

Let me now outline the main aspects of the Charter:
“1. Initiate Household Sustainability
(Household employment and labour plan) Each Vincentian household must have at least one occupant employed over the next 5 – 10 years.

2. Encourage Prayer
(A school prayer and pledge to be recited daily) To be encouraged in Public Offices. Suggested Prayer to be crafted by the St. Vincent and the Grenadines Christian Council in collaboration with other religious organizations. The Ministry of Education will be the executing agency.

3. Invigorate Sunday School
(Support a fund for Sabbath and Sunday schools teaching and teachers). Agency – the St. Vincent and the Grenadines Christian Council in collaboration with other religious bodies and the Ministry of Education.

4. Strengthen Youth Development Program
(Work with the National Youth Council on a pro rata contribution of $1,000.00 per member group base) on an approval program basis. The following organizations should be given special recognition.
St Vincent and the Grenadines Cadet Force, Boys’ Scout and Girls’ Guide, Pathfinders, Red Cross, ISCF – Interschool Christian Fellowship, 4 H Club, National sporting bodies, Service clubs, Youth Arms Agency – National Youth Council/Ministry of Youth Affairs.

5. Further Stimulate the Intellectual
Promote Compulsory Debating Capacity of Students Societies in all Government and Government Assisted Secondary schools. Agency – Ministry of Education, National Youth Council.

6. Effect Qualitative Improvement in National Security Royal St. Vincent and the Grenadines Police Force, Professionalisation, Leadership programs for the Officer Corp, Institute short-term contracts, Recall experienced retired officers, Explore Foreign Assistance Program, Attachments.

7. Grant Amnesty
Firearms (illegal)

8. Provide a Girls’ Home
Similar to Liberty Lodge for disadvantaged, homeless and orphaned girls. Agency – Ministry of Social Development.

9. Develop for television
(SVG TV and Karib Kable) Daily Value laden family life telecast. Agencies – Ministry of Culture, Ministry of Education, National Youth Council, SVG TV and Karib Kable.

10. Establish a Sports Endowment
$20,000.00 each to top ten (10) sporting bodies for community based sports program. Agency – Ministry of Sports and the National Youth Council.”

Mr. Speaker, we were not permitted to debate this motion on the ground I am told that we had mentioned a figure in the Charter and that was against the Standing Order of the House. But it was obvious to all and sundry that we were seeking approval of members but rather the acceptance of the principles.

The fact remains Mr. Speaker that at no time since 2001 were we really allowed to any meaningful debate on motions brought by the Opposition in the Parliament of St. Vincent and the Grenadines.

The ULP government’s concern was not the burgeoning crime figures but scoring cheap political points while crime continues unabated in this land of our. The talk about “tough on crime and the causes of crime” is just that “talk”. Meanwhile the law abiding citizens of this country continue to suffer at the hands of the criminal some of whom have been pardoned and release from jail. That Mr. Speaker, I assume is being tough on crime.

OFFSHORE FINANCIAL SERVICES

Mr. Speaker the offshore financial services sector which promised much under the NDP Administration has produced very little under this government. It has been five years since this country was removed from the OECD and FATF’S blacklists of uncooperative countries and yet we have seen little signs that the offshore sector is moving into a direction that is favourable to the economy of this country. Mr. Speaker, the NDP Administration placed great faith in this sector as one of the engines of growth in the economy and we studied very carefully the strengths and weaknesses of other jurisdictions in order to position this sector as a premier offshore jurisdiction, and we were, Mr. Speaker, achieving that acclaim. But, Mr Speaker, in spite of our efforts, which I must hasten to add brought just rewards to this country, the ULP in opposition continued to make unfavourable comments about the offshore sector which I have no doubt, Mr. Speaker, is somewhat responsible for the position that we are in today. What the ULP Administration has always failed to realize is that political sound bites that produce sweet music to the ears of the electorates are leaving bitter tastes in the mouths of the people of this country. Therefore, when they criticize unreasonably and destructively to secure the X at the polls, they are too politically partisan to realize the negative impact of such criticisms on this country’s economy.

Mr. Speaker, I can recall the days when the ULP in opposition used every opportunity to severely criticize the offshore financial services sector. Such criticisms intensified after this country was unlawfully blacklisted by the OECD and FATF. The impression was given that the ULP did not look upon the offshore sector in a favourable light and many believed that the sector would have been eventually dismantled if the ULP were to gain political power in this country. It is therefore not surprising Mr. Speaker, that the sector is slowly drifting into oblivion.

Mr. Speaker ever since the NDP left office in 2000 the ULP has not been able to register 1,500 offshore trusts, banks, mutual funds, companies and insurances altogether. In other words Mr. Speaker, less than 1,500 offshore entities have been registered each year since the ULP took political power in this country. But Mr. Speaker, during the NDP’s last year in office, which was in 2000, we registered over 2,500 entities. Mr. Speaker that was the year in which this country was blacklisted by the OECD and FATF countries. That was the year, Mr. Speaker, when a Financial Advisory was issued by FINCEN, a department in the USA’s treasury, which promised to diligently scrutinize banking wire transfers to and from St.Vincent and the Grenadines. That Advisory, Mr. Speaker, was an unfair, unfortunate and undesirable message to the world that money transactions to and from St. Vincent and the Grenadines would be monitored. And Mr. Speaker, in spite of all the negative pronouncements by the ULP that was the last year that the offshore financial services sector registered over 2,000 offshore entities - it was the last year that the NDP was in office. Since then, Mr. Speaker, under the ULP Administration the International Financial Services Authority is struggling to register 1,500 let alone 2,000.

But Mr. Speaker we have been removed from the blacklists about five years ago, so why is the ULP Administration still struggling to develop the offshore sector? Since 2001 the ULP Administration has substantially and in some ways unnecessarily tinkered with the offshore laws. For five years the ULP Administration boasted that it has in effect created a brand new sector which it refers to as the international financial services sector, administered by the International Financial Services Authority. But Mr. Speaker, where has it got this country- I will tell you and the nation Mr. Speaker- very little, or nothing. The offshore sector cannot even register 1,500 offshore entities and from all accounts will continue to struggle to register 1,000 in the years ahead. Mr. Speaker, the performance of the offshore financial services sector in terms of annual registrations is as follows: In 2001, the first year when the ULP took power in this country, registrations fell from 2,500 in 2000 to 1,437 in 2001. Offshore registrations decreased further in 2002 when only 855 entities were registered and in 2003 registrations fell to a meagre 742. Mr. Speaker, registrations in the year 2004 were, 1,026. This was as bad as the previous two years but only a bit better. It is however, rather interesting to note Mr. Speaker that since 1997, and under the NDP Administration, the offshore sector did not perform so miserably and it is also equally important to note that the 1,437 entities that were registered in 2001 were spill offs from the hard work that was done under the NDP Administration in 2000 and for the first three months of 2001.

Mr. Speaker in the following two years, which are, 2005 and 2006 registrations were 1,400 and just over 1,380 respectively and so far, in 2007 about 1,450 entities have been registered. It is therefore clear that in spite of all the window dressing efforts of the ULP Administration, the offshore financial services sector has not reached any where near the levels achieved by the NDP from 1997 up to and including March 2001.

This shows Mr. Speaker that the performance of the sector cannot only be measured by its regulatory framework. It is true, Mr. Speaker, that desirable legislation can be the hallmark of a good offshore jurisdiction but Mr. Speaker, there are other factors that are equally important, such as its marketing strategy, a conducive and accommodating domestic financial sector, its human resource base and its location. I am not convinced that the current legislative framework is of any great attraction to offshore investors and neither am I convinced that the marketing strategy of ULP Administration is in any way incisive nor strategic. Mr. Speaker, the provision of offshore financial services can in some cases create complexities in ascertaining not only what the market wants but also appreciating and understanding what this country has to offer. There are times, Mr. Speaker, when it is difficult to determine which comes first – understanding what the market wants or appreciating what we have to offer. Mr. Speaker the most appropriate and commonsensical approach will be to seek the requirements of the market and then formulate the regulatory framework accordingly. In theory, Mr. Speaker, that is the right approach but how that is applied in practice is another issue. There is little or no evidence that the ULP Administration has sought to ascertain the requirements of the market – there is no evidence that by its regulatory framework or otherwise the ULP Administration is seeking to carve out a niche in the international financial market. However, Mr. Speaker, there is indeed an abundance of evidence that the offshore financial services sector is moving at a sluggish pace into an insignificant corner of this country’s economy.

Mr. Speaker, the marketing of the strengths of the offshore sector is paramount. Those who market this unique product must understand it- they must be able to promote its strengths and identify its weaknesses- they must have sound knowledge of its regulatory framework and Mr. Speaker, they must be sufficiently articulate in order to explain in the simplest of ways how that framework can benefit investors. But knowledge of the offshore legislation is not all Mr. Speaker - an understanding of how the domestic financial services sector interacts with the offshore sector is vital. In essence Mr. Speaker, those who promote the offshore finance sector should be well rounded and appropriately trained. Mr. Speaker, the National Investment Promotions Inc. (NIPI) is currently the marketing arm of the offshore sector - presumably, this separation of the marketing arm of the sector from that of the regulatory was established in order to satisfy the requirements of the Financial Actions Task Force’s 25 criteria for Assessing Non-Cooperative Countries and Territories. But Mr. Speaker, satisfying the FATF without installing adequately trained personnel is counterproductive. Unless those employed in marketing are sufficiently knowledgeable about the regulatory framework and the offshore business we are essentially spinning top in mud. I can recall Mr. Speaker that from 1997 up to 2000 under the NDP Administration there was a marketing blitz. Not only did the NDP Administration sponsor offshore conferences, the offshore finance authority was heavily involved in advertising its products at exhibitions and trade shows. Similarly, Mr. Speaker, almost every month there was either an article about St. Vincent and the Grenadines Financial Services Sector. Mr. Speaker, under the NDP Administration there was a tremendous amount of interest and enthusiasm from investors, prospective investors, legal and financial professionals and offshore financial services providers. Since the ULP Administration took power in 2001 that interest and enthusiasm have waned significantly and there seems to be little chance of any recovery in the future or more specifically, under any ULP Administration.

Mr. Speaker, the domestic financial sector must also compliment what happens in the offshore sector. There must exist an apparent symbiotic relation between the domestic and the offshore financial services sectors. It is crystal clear Mr. Speaker that the offshore financial services sector cannot achieve an acceptable level of success if little support is provided from financial institutions operating in the domestic sector. Mr. Speaker, offshore entities that are registered in St. Vincent and the Grenadines for the most part need to establish bank accounts. Equally as important Mr. Speaker, is the need for the local domestic banks to feel a sense of security in knowing that they would not be brought into disrepute when they permit their institutions to be used as conduits for the funds that will be channelled in and out of this jurisdiction? Interestingly, Mr. Speaker, most of the local domestic banks are reluctant to open bank accounts for offshore entities and in some instances some have been refusing to open any bank accounts at all. Reports indicate that only the National Commercial Bank of St. Vincent and the Grenadines is prepared to open bank accounts for offshore entities that are registered in this country. Yet Mr. Speaker, offshore services providers in this country are being told that they should try to open bank accounts for their offshore clients either in Barbados or the British Virgin Islands. This restriction on opening of bank accounts can adversely affect the performance of the offshore sector in this jurisdiction.

Essentially, Mr. Speaker the impression is therefore given that most of the local domestic banks have very little confidence in the offshore finance sector in this country. The impression is also given that the offshore finance sector is not as hygienic as we are being led to believe. Mr. Speaker, I find this development rather strange to say the least. Mr. Speaker I would reiterate - this country was removed from the OECD and FATF’s blacklists about five years ago. The Prime Minister and the rest of the ULP Administration boasted that this country was given a clean bill of health by both the OECD and FATF. The ULP government repealed the Proceeds of Crime Act 1997 and enacted the Proceeds of Crime and Money Laundering (Prevention) Act in 2001. It also enacted the Financial Intelligence Unit Act in 2001 and the Exchange of Information Act in 2002 and it has been forever tinkering with the offshore legislation, yet, Mr. Speaker, the banks appear to lack the confidence that is necessary to do business with the offshore finance sector. But, Mr. Speaker, under the NDP Administration offshore entities did not have such difficulties opening bank accounts. What therefore is the reason for this reluctance, to open bank accounts for offshore entities? Mr. Speaker, for over six years the NDP Administration has been advocating the establishment of a department in the NCB with appropriately and adequately trained personnel specifically devoted to the business of offshore financial services. This has not yet materialize but I have no doubt that if such a department was established, many of the problems that offshore investors face, including opening bank accounts, would not have arisen and even if they did arise, they could have been resolved expeditiously.

Mr. Speaker, the human resources base in this country needs to respond to the changes in the economic sectors and the challenges of the times if we are to make any meaningful progress. But the ULP Administration must take the lead and the responsibility to ensure that square pegs do not reside in round holes. In so far as the offshore finance sector is concerned, Mr. Speaker, the human resources base to which I refer is very wide – stretching from the staff at the International Financial Services Authority, to offshore financial services providers, to professionals including accountants and lawyers and those who are employed in and as a direct result of the offshore finance sector.

Mr. Speaker, when the new raft of offshore legislation was introduced in December 1996 the NDP Administration was focused on providing employment for professionals, persons in the tourism industry and others who would have been employed by or as a result of the offshore finance sector. It is important to note Mr. Speaker that the emphasis was on the citizens and residents of this country. The legislation was new, the type of services required was also a novelty to most and the physical and financial infrastructures were effectively being put in place. What was encouraging Mr. Speaker, is that the entire country, except the ULP in opposition was mobilized behind the sector and everyone concerned was becoming a fast learner. Mr. Speaker during those halcyon years there were over 30 licensed offshore Agents registered in St. Vincent and the Grenadines and providing offshore financial services to offshore clients. Many may not have been substantially occupied in the provision of offshore business but they were nonetheless enthusiastically involved seeking to register offshore entities no matter how small the number of registrations. Mr. Speaker during those years under the NDP Administration all Registered Agents were required to be citizens of this country or a citizen of this country was by law required to hold a substantial interest in the registered agency. The circumstances have now changed Mr. Speaker, no longer is it mandatory for the owner of a licensed registered agency to be a citizen of this country - foreigners can also apply for and if successful be issued with an offshore services providers licence to do offshore business in this country.

Mr. Speaker the involvement of foreigners in this way was an attempt to boost the number of entities registered by the International Financial Services Authority and hopefully to expand the human resources base by attracting and inviting expertise from abroad to compliment what we currently have at home. But Mr. Speaker what I have mentioned in the foregoing is a clear and resounding exemplification of failure by the ULP Administration, in spite of its feeble efforts, to try and restore the good performance, confidence and pride that existed under the NDP Administration between 1997 and March 2001. Offshore registrations have still not attained the levels that were achieved between 1997 and March 2001. Mr. Speaker I must also hasten to add that during those years, only citizens of St. Vincent and the Grenadines were permitted by law to own the businesses that were licensed to provide offshore financial services. Since 2001, Mr. Speaker, the ULP Administration has been doing everything possible to exclude most of our Vincentian registered agents from the provision of offshore business in the hope that only a politically favoured few and those clearly possessing specialized skills are permitted to function as licensed offshore providers.

Mr. Speaker, this ULP Administration is finally succeeding in the process of exclusion by increasing the annual renewal licensed fee for registered agents from $250.00 to in order to frustrate those who seem to have lost the enthusiasm, vigor and gusto for the offshore business, specifically because of the way that it is configured under the ULP Administration. I however want to remind the ULP Administration that the success that the offshore finance sector enjoyed under the NDP Administration was partly due to all the Registered Agents who were all citizens of this country. Mr. Speaker, I do not want any one to misunderstand what I am saying. We have no problems with foreign entities providing offshore financial services in this country. What I am saying Mr. Speaker, is that our local offshore providers must be looked upon favourably and should be accorded every bit of encouragement to assist them to perform their functions effectively.

Mr. Speaker, every year for the past seven consecutive years the ULP Administration kept blaming the poor performance of the offshore sector on the blacklisting of this country by the OECD and FATF countries. But Mr. Speaker I would repeat, lest they forget that during the year of the said blacklisting and under the NDP Administration the Offshore Finance Authority registered over 2,500 offshore entities. Mr Speaker, it is now about five years after this country was removed from the blacklists and yet the ULP Administration is still struggling to revive the offshore sector that it is responsible for weakening substantially. When the NDP lost the elections in 2001 there were 11, 854 entities on the registers at the offshore finance authority. Now, Mr. Speaker, and under the ULP Administration only just over 6,500 entities were renewed so far for the year 2007. This represents a 45% reduction in the offshore entities that were recorded on the offshore registers in March 2001. Mr. Speaker, the ULP Administration must accept that it has failed to maintain the healthy offshore sector that was left by the NDP Administration. No longer is anyone going to tolerate the ULP Administration, especially the Prime Minister, blaming the blacklisting of this country as the reason for the continuous poor performance of the offshore finance sector.

Mr. Speaker for years I listened to the Prime Minister ranting and raving that the NDP caused this country to be blacklisted by not satisfying the requirements of the OECD’s harmful tax initiative and the FATF’s 25 Assessment Criteria for Non-Cooperating Countries and Territories. Mr. Speaker, the impression given by the Prime Minister is that the NDP did something wrong or did not do what it was obligated to do. But Mr. Speaker that is far from the truth. Mr. Speaker this country had enacted a plethora of laws which effectively provided for cooperation with other countries in the fight against crime and it had always acted responsibly in its conformity with and adherence to international legal principles. Mr. Speaker, the NDP Administration was adamant that its fiscal regime was not harmful to that of any other country and that it was acting within international law when it established and maintained the offshore finance sector as a tax free industry. St. Vincent and the Grenadines was one of many countries that had favourable tax regimes. The NDP Administration also resisted the allegations that were made by the FATF that this country’s regulatory framework, both domestic and offshore prevented cooperation with other countries in the fight against money laundering.

But Mr. Speaker what the Prime Minister fails to realize is that St. Vincent and the Grenadines is a state and therefore under international law is equal to any other state which means that no state should interfere with the internal affairs of another state. Moreover, Mr. Speaker, article 4 of the Declaration on the Establishment of a New International Economic Order provides that every country has a right to adopt the economic and social system that it deems to be the most appropriate for its own development and not to be subjected to discrimination of any kind as a result. Accordingly, Mr. Speaker, this is what was done under the NDP Administration when we significantly improved the offshore sector and that was because we knew that our actions were in accordance with international law why we fought and attempted to resist the unlawful actions by both the OECD and FATF. However, Mr. Speaker, notwithstanding this country’s sovereign right as a State to organize its affairs in any way it chooses, this does not automatically mean that it must conduct its affairs in a manner that harm the affairs of another state. But by the same token Mr. Speaker, this country, under international law, has a right to self determination and self governance. By forgoing those rights Mr. Speaker, grave economic hardships could have been imposed on Vincentians and that is what the NDP Administration did not want to do. But as it turned out Mr. Speaker the ULP administration was ready to do anything that provided for it political mileage even it resulted in economic hardship.

Mr. Speaker I also wish to draw the Prime Minister’s attention to Resolution 2131 of the United Nations General Assembly 1965 which provides that “All peoples have an inalienable right to complete freedom, the exercise of their sovereignty and the integrity of their national territory, and that, by virtue of that right, they freely determine their political status and freely pursue their economic, social and cultural development.” Mr. Speaker, Resolution 2131 speaks for itself and I hope that the Prime Minister is listening and learning.

Mr. Speaker it is also important for the Prime Minister to understand that as a lawyer he was appropriately placed to bring to the nation the unlawful actions of the OECD and FATF and say why their actions were unlawful. But the Prime Minister had no intention going down that route, either because he was playing politics with people’s lives as he continues to do or his knowledge of international law is severely limited or perhaps, Mr. Speaker, a combination of the two. Mr. Speaker I hope that after giving the Prime Minister and the ULP Administration a brief appreciation of international law as it relates to the unlawful actions of the OECD and the FATF that the ULP Administration will no longer blame the NDP for the blacklisting of this country.

Mr. Speaker, the NDP Administration has always questioned the legal identity of both the OECD and FATF and the legal basis for the blacklisting of a sovereign state like St. Vincent and the Grenadines. Mr. Speaker, this country should only acknowledge the rights and obligations of the OECD and FATF if they are international organizations which possess international legal personality. Mr. Speaker international organisations are entities which must be comprised predominantly of states and/or other international organisations and established under international law. Those organisations are usually created by treaty but Mr. Speaker; they can also be created by other means, such as resolutions of another international organisation or by joint unilateral acts of other states.

On the other hand, Mr. Speaker, international legal personality essentially accords unto the international organisation a legal personality that is separate and distinct from its member countries. Whereas it is true to state that the OECD satisfies the requirements of an international organisation the same is not true for the FATF. Mr. Speaker, the legal personality of the OECD is outlined in Protocol No. 1 to the Convention for European Economic Co-operation on the Legal Capacity, Privileges and Immunities of the Organisation 1948 which provides that “The Organisation shall possess juridical personality. It shall have the capacity to conclude contracts, to acquire and dispose of movable and immovable property and to institute legal proceedings.”

Mr. Speaker, by its own admission the FATF stated that it is not a permanent international organisation nor a body managing a legally binding convention and that it does not have a tightly defined constitution. Moreover, Mr. Speaker, the FATF also stated that its 40 Recommendations are not a binding international convention and that it is an ad hoc grouping of governments and others with a complex single agenda. What this means Mr. Speaker is that the FATF does not have a constitutional document wherein its member territories have indicated that it should have separate legal status. Furthermore, Mr. Speaker, its ad hoc existence provides further evidence that it is not detached from its member states. Therefore, Mr. Speaker, it is not an international organisation and for that reason this country did not have to acknowledge its existence.

Mr. Speaker, I now turn to whether this country was legally bound to implement the initiatives of both the OECD and FATF. This country could only have been bound by those initiatives under international law if we entered into a treaty with the OECD and FATF, were stopped from going back on a commitment to the OECD and FATF that we made and implemented or if the requirements of the initiatives had evolved into international customary rules. Mr. Speaker, this country clearly did not have a treaty with the OECD which accorded to the OECD the authority to dictate our fiscal policies. The FATF on the other hand being devoid of legal personality could not have entered into treaties on behalf of its member states and therefore Mr. Speaker no treaty could have been entered into with the FATF.

In so far as the principle of estoppel is concerned, Mr. Speaker, this arises where one party is prevented from going back on the promise that it made to another in which that party relied on the promise to its detriment or the other party received a benefit or some advantage from making the statement. There is no evidence that this country acquiesced to the OECD and FATF’s initiatives in a clear and unambiguous manner, or at all, and therefore the principle of estoppel does not arise.

Mr. Speaker the OECD and FATF’s initiatives could only have been part of international law if they had evolved into international customary rules. Such rules are evidence of general practice accepted as law. But Mr. Speaker the general practice must amount to a settled practice which must be generally acknowledged by states as being obligatory and those states must be bound by that practice as a legal obligation. The OECD’s harmful tax initiative could not have evolved into customary international law for several reasons, including the existence of over 200 harmful tax regimes in certain jurisdictions in the OECD -providing evidence that even the OECD countries did not conceive of the harmful tax initiative as being a settled legally binding practice. Furthermore, Mr. Speaker the FATF by its own admission has clearly stated that its 40 recommendations out of which the 25 Assessment Criteria for Non-Cooperating Countries and Territories were crafted were non-binding and therefore could not have amounted to a settled practice that carries with it a legal obligation. There is also evidence, Mr. Speaker, of other countries, including the USA that did not satisfy the 40 Recommendations or the 25 Assessment criteria but they were not blacklisted. Evidence of such discrimination and the mere fact that many countries actually resisted the implementation of the 25 Assessment criteria actually confirms that the 25 Assessment criteria could not have at the time of the blacklisting of this country evolved into a settled practice. Accordingly, Mr. Speaker the FATF had no legal basis whatsoever to blacklist this country and neither was this country in breach of any of its international obligations.

Mr. Speaker, the NDP Administration was vindicated with the apology given by the OECD for its erroneous decision to blacklist this country. I am now Mr. Speaker, eagerly waiting to here a similar response from the FATF. It therefore goes without saying that the ULP Administration has, since 2001 failed to maintain a successful offshore financial services sector and has been for the past seven years trying to conceal its incompetence in governing the offshore sector. Mr. Speaker, I expect the Prime Minister to acquaint himself with international public and private law and after having done so the ULP Administration should publicly accept the blame for the morose state of the offshore financial services sector.

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