Grenada Finance Minister issues economic statement

Wednesday, October 29, 2003

ST GEORGE'S, Grenada: In his fourth press briefing for the year, Grenada's Minister of Finance, Mr Anthony Boatswain, focused on three economic issues: the general economic condition, the government's fiscal operations in 2003 and Grenada's economic performance from 1995 to the present time.

Mr Boatswain first made a few observations about general economic conditions. First, at the international level, the global economy is showing some signs of improvement.

The US economy is now expected to grow by 2.6 percent while the European Union is expected to grow by approximately 1.0 percent.

In Grenada, for the first six months of 2003, the economy grew by 2.9 percent largely driven by construction, tourism and telecommunications.

The economic data indicate that the Grenadian economy has gathered momentum over the past six months. At this stage, the Ministry of Finance is projecting Grenada's economy to grow at 2.5 percent for 2003.

He then reviewed the Grenada government's fiscal performance for the first nine months of this year. Consistent with higher levels of economic growth, particularly since the second quarter, the fiscal situation has shown some improvement.

For the first nine months of this year, actual revenue receipts fell short of projections by $13.6 million or 6 percent. This shortfall is due primarily to lower than expected receipts from Non Tax sources such as licenses and dividends.

In light of the revenue shortfall, Government has made a strong attempt to control current expenditure. As a consequence, current expenditure for the first nine months was also lower than budgeted ($198 million compared with $228 million). Of course, there will an increase in current expenditure in the last quarter of the year because of retroactive payments to public officers. On October 31, teachers, public officers and pensioners will receive backpay for 2002 amounting to $3.3 million.

As to whether the average Grenadian is better off today than he was eight years ago, Mr Boatswain examined some key factors.

From 1997-2000, Grenada's economy grew at an average 6.5 percent, the fastest growth in the OECS. During the past seven years, the Grenadian economy has grown by 48.4 percent.

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