Antigua & Barbuda's Economy In Good Health, Says IMF

Mandy Robinson, Tax-news.com, London

23 November 2000

Not only has an investigation conducted by the International Monetary Fund (IMF) announced that Antigua & Barbuda’s economy grew by 5 per cent last year, it has also forecast that it will expand again by almost the same amount this year.

This is good news for the Antigua government and blows away recent media reports that the country's economy has become stagnant. Financial Secretary Lennox Weston said the IMF is 'talking about 5 per cent growth in an economy that experienced two hurricanes last year. Five per cent growth is fantastic.'

Mr Weston explained that the government's investment strategies were behind the economy’s growth including projects such as the government office complex, the Mount St. John Medical Complex, the Vendors Mall, the Heritage Market complex, and the refurbishment of the country’s roads.

Despite a dip in retail sales, continued Mr Weston, 'this country’s economy is bubbling at 5 per cent and inflation is at zero .. if we are doing 5 percent with a broke government, suppose we (the government) had the money? This economy is driven by public sector investment; we don’t have any local indigenous private sector investment taking place at the level we would like.'

The IMF report was published following a visit by an IMF delegation to the country last week to evaluate the state of the local economy. The team entered into talks with government officials and researched economic and fiscal data.

In 1999, the government made a decision to forego the collection of approximately $70 million in taxes and duties from the private sector. This year, Mr Weston urged the private sector to pay its taxes. This, said the financial secretary, will allow the government more opportunity for investment: 'and you can imagine what will happen if the economy expands to 8 per cent.'

Conclusions of the report, said Mr Weston, included the IMF endorsement of a proposal made by the Antiguan government for 'an expenditure reduction programme, in which government will target discretionary waiver of taxes and duty.'

Mr Weston said other government plans involve the development of a new training programme that will look at 'a commingling of welfare hiring, the training of government workers, and general employment. We will train [persons] in a discipline for six months and then they will be mandated to find employment in their respective field.'

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