Speaking at his weekly press conference on Tuesday this week, Chief Minister, Osbourne Fleming, warned that the employment situation in Anguilla would continue to grow until the island began attracting investors again.

Chief Minister Osbourne Fleming and Hon. Victor Banks

“I mentioned in the House of Assembly that everyone in Anguilla today is affected by this crisis,” he went on. “I reiterated the position that this has nothing to do with the Government of Anguilla. This is world-wide situation.” Mr. Fleming criticised Opposition Member, Hubert Hughes, for not supporting the Government’s motion to borrow 49 million dollars presented by Minister of Finance, Victor Banks, in the House of Assembly on Friday, December 4.

“What that says is that he has no care or feelings as to what is going to happen to our civil servants or for the essential services in Anguilla,” the Chief Minister continued. “The plain facts are that if the Government of Anguilla cannot access borrowing money at this time, it means that we cannot pay bills. I think the presentation made by the Ministry of Finance said that the only alternative we have now is to borrow. There in no further way.

“We are conscious of the fact that although the motion has been passed, the process is not all over. It must now be forwarded to London where the Secretary of State must give his approval; and we anticipate that approval will not come easily. We are not singular in this respect because all Overseas Territories have the same problems… and all are borrowing. This has nothing to do with politics. This is the real world in which we live and our only hope is for us to be able to borrow some money until we have passed the storm.”

Mr. Fleming made reference to the Cayman Islands saying they were very progressive and had built up huge reserves over the years but which were now depleted. He mentioned that the Overseas Territories Minister, Chris Bryant, had informed the Caymans that in order for the British Government to approve borrowing they might have to introduce some tax measures including a payroll tax. “This is not an easy matter. It is serious business,” Mr. Fleming commented. “We have to be guided by what is happening to our brothers next door, especially those in the Overseas Territories.”

He was grieved that the Government of Anguilla, like those in the other Overseas Territories, might have to take steps [to introduce tax measures]. “This is nothing that brings joy to us and we don’t know what will happen,” he stated. “We will be dispatching a document to London later this week addressing the motion we took to the House, and will also provide them with information on how we feel we will be able to sustain [borrowing]. If the British Government is so hard on Cayman, a territory that has supported itself for years, with no mercy, so to speak, I think that they will do the same thing to us.

“But can we be in this situation divided? The answer is no, and so it was so regrettable yesterday to note that the Member for Road South objected to this. It sends a wrong message in that when the British Government would have looked at what we discussed in the House, there would have realised that a senior member of the House of Assembly objected. The point I am making here is that we should be going to the British Government with this request together. It gives more strength to our request.”

The Chief Minister reported that a number of Anguillians had not been paying property tax and he called on all defaulters to pay. He also urged all persons expected to make other payments to Government to pay up, noting that this would help the Government to meet its financial obligations. He disclosed that there was some two million dollars outstanding in property tax “on the streets.”

He continued: “I was forced [in the House of Assembly] to let the people of Anguilla know that the Member for Road South, Mr. Hughes, is one of the persons who owe the Government thousands of dollars in property tax. I emphasised it because I believe that when you achieve such high office, you must be role models to the people of Anguilla. It is a shame that a man who has been in this business for so long, refuses to pay property tax, yet he sits in the House of Assembly…

“My final request is that all Anguillians who have outstanding monies for the Government of Anguilla should kindly pay. If you can’t pay all one time, we can make arrangements for these monies to be paid. In the case of Mr. Hughes, we are going to take that money out of his rent as from this month and I will be happy to tell you it is paid. We must show an example to the world that we are decent people.” (The Government is renting an office building from Mr. Hughes.)

Minister of Finance, Victor Banks, was grateful to the staff of his Ministry who made the presentation on the island’s financial situation and stressed the need for borrowing.

Mr. Banks said the Opposition in the House had no problem with the first of three motions, he presented, to borrow 20 million dollars from the National Bank of Anguilla for the customary overdraft facility. He observed that they had some issues regarding the second motion which requested 49 million dollars of which 20 million would go towards paying off the existing overdraft facility. The other 20 million was earmarked for the re-financing of the Treasury Bills. The additional 9 million would be used for refinancing a number of loans, from National Bank and the Caribbean Commercial Bank, to the tune of 7.44 million dollars. The balance was to establish reserves for the payment of other funds.

The Minister explained that the third motion for 895,000 US dollars dealt with the Caribbean Risk Insurance Fund, the development of the Hospitality Institute and the Hurricane Omar Relief Fund. He said this was a straightforward motion which was supported by all members of the House.

Mr. Banks said that the Government had embarked on a number of incentives to attract direct foreign investment in Anguilla. “We were successful, but we had to make sacrifices,” he told the reporters. The much-criticised memorandums that we signed with the various investors have now become best practices, a model for the rest of the Caribbean…Every country in our region involved in tourism investment, has always insisted that the approach that Anguilla adopted is the right approach. Whereas we grant incentives and duty-free concessions to investors only for construction materials and furnishings, a lot of these other jurisdictions grant duty-free concessions for a whole range of activities. In Anguilla we have a dialog between investor and government regarding the concessions the government makes and expects from that investor. The agreement is very clear and placed in a public document albeit it has never been discussed in the House of Assembly. It is something that is discussed widely and the Government of Anguilla has made its presentations in the various [meetings].”

Replying to concerns about the Government’s support for real estate villa development as it relates to hotels, Mr. Banks said tourism projects could not now borrow money from a bank for a hotel project. “What happens now is that you put an element of real estate sales in the mix…and this enables the investor to have a return on his investment within a short period of time.”

Mr. Banks reported that the Government’s reserves were in the region of 36.49 million dollars but because 24 million dollars (most already spent) was forthcoming from the European Development Fund… the reserves were in the region of 60 million dollars. He said that there was a need for the Government to be able to meet its recurrent financial requirements including the payment of public servants and other persons, support for agencies like the Development Board, road maintenance, schools, recreation facilities and so on.

“We now have to go to the next step and I think the British Government has now got to look at our strategy,” he continued. “They have asked us to put together a debt-management plan. We have been doing that. We have put out a request for proposals from a number of internationally-renowned consultants and at least three of them responded and are from the UK. We believe that we are on the right track to reaching the requirements of dealing with these challenges.”

Mr. Banks noted that, as implied by the Chief Minister, some form of taxation has to be part of the Government’s strategy. He said that a whole range of taxes was already in place and to date 10 million dollars in various taxes was owed to the Government, meaning that tax collections could be improved.

“What are you going to tax if there is no economy, if there are no jobs or business opportunities?” Mr. Banks asked. “It means that you are putting yourself in an even more serious position, and I do not accept the analysis which the British Government has been putting forward at all. I believe that the Government of Anguilla has to get itself on a sustainable footing that can only come on the basis of short term and long term borrowing. This is the only way that it can happen. That is why Turks and Caicos, Cayman Islands, the British Virgin Islands and Montserrat have all been talking about additional funding and support. And that is why the independent countries of the Caribbean are all borrowing.”

| Printer-friendly page | Send this article to a friend |

World News