Mr. Speaker, I beg to move the following Motion standing in my name:
“Whereas it is necessary to provide for the State of Grenada for the year 2021 by means of an Appropriation Act;
Be it resolved that the Estimates of Expenditure for the year 2021 be approved.”
Mr. Speaker, as this is a Money Motion, I wish to signal to this Honourable House that I have the consent of the Governor General to proceed.
Mr. Speaker, in compliance with the Fiscal Responsibility Act, and Regulations under the Public Finance Management Act and the Public Debt Management Act, I wish to advise that the following reports are being submitted to this Honourable House:
- The Medium-Term Fiscal Framework 2021-2023, in accordance with Section 9 (2) (a) of the Regulations for the Public Finance Management Act No. 17 of 2015;
- The Budget Framework Paper 2021, in accordance with Section 13 of the Regulations for the Public Finance Management Act No. 17 of 2015;
- The Medium-Term Debt Management Strategy 2021-2023, in accordance with Sections 5(1) to 5(3) of the Public Debt Management Act No. 28 of 2015, as amended;
- The Fiscal Risk Statement, in accordance with Section 12 (1) (e) of the Fiscal Responsibility Act No. 29 of 2015, as amended.
- The 2020 Economic Review and Medium-Term Outlook; and,
- The 2019 Annual Debt Report.
Mr. Speaker, as a nation and a people, we have once again demonstrated incredible resilience in the face of adversity.
For this Mr. Speaker, I am immensely grateful to the Almighty God for his continued mercies and guidance.
Indeed, I am comforted by his words in the Holy Scriptures in the book of 2 Corinthians 4: 8 and I quote “We are hard pressed on every side, but not crushed; perplexed, but not in despair.”
I am also extremely grateful, Mr. Speaker, to all our citizens for their sacrifice and patriotism, especially our frontline workers, for putting country above self in the fight against this deadly Coronavirus. It is through our collaborative efforts that we have successfully managed the pandemic thus far. I encourage us all to recognise our individual and collective responsibility as we continue to safeguard our beautiful country and all of its people.
I also wish to thank our friends and partners outside of Grenada for their strong show of support in helping us to navigate this extremely challenging period.
Mr. Speaker, I am grateful to the Hon. Prime Minister for the confidence reposed in me to lead the Ministry of Finance in this difficult period.
Permit me to also express, on behalf of the Government and people of Grenada, my deepest condolences to the families who have lost loved ones in the Diaspora due to COVID-19. Our hearts and prayers are with you all.
Mr. Speaker, the impact of the COVID-19 pandemic is unprecedented in scope and magnitude.
As I address this Honourable House today, over 63 million people globally have contracted this deadly virus and in excess of 1.4 million have sadly succumbed to its effects.
The pandemic is expected to shrink global output by US$8.5 trillion this year alone and it has thrown tens of millions of people across the world into poverty and unemployment.
Here at home, forty-one cases have been recorded to date and our economy is expected to experience its worst economic downturn on record.
Mr. Speaker, this is the scope and magnitude of the challenge that we have been grappling with since March of this year. The road ahead will be extremely difficult as we reshape and renew our economy and society in this new and uncertain environment.
While we are proud of our response to the pandemic, much work lies ahead. We must therefore remain steadfast in our efforts to protect our people and rebuild our economy.
Rising from the ashes of this pandemic will require bold and decisive leadership, the kind of leadership that this Administration demonstrated previously, in rebuilding the economy in the aftermath of Hurricanes Ivan and Emily, and the Global Financial Crisis.
Mr. Speaker, I now turn to the economic and social context for the 2021 Budget.
2. Economic and Social Context
2.1. International and Regional Developments and Outlook
Mr. Speaker, the 2021 Budget has been prepared against a backdrop of extraordinary uncertainty facing the global economy.
The International Monetary Fund (IMF), in its World Economic Outlook released on October 13th, noted that while the outlook for the global economy has improved slightly relative to its June 2020 forecast, the situation remains extremely grim.
Closer to home, the Caribbean region has not fared better. Except for Guyana, the rest of the region will see economic declines ranging from 4% to 20% this year.
The impact on the eight-member Eastern Caribbean Currency Union (ECCU) is particularly acute, given the small size of their economies, heavy dependence on tourism, limited resources, and inextricable link to the global economy.
Mr. Speaker, more details on the performance of the global economy, CARICOM and the ECCU can be found in Appendix II of the published copy of this Statement.
2.2. Impact of the Pandemic on the Domestic Economy
2.2.1. Economic Performance
Mr. Speaker, Grenada’s economy expanded at a brisk pace in the past seven years, with economic growth averaging 4.4% in real terms over the period 2013-2019.
However, data for the first half of 2020 indicated major declines in all sectors of the economy, particularly the Tourism and Private Tertiary Education sectors. As a result, an overall double-digit contraction of 12.2% is estimated for 2020 in contrast to the 3.2% positive growth projected at the start of the year.
2.2.2. Fiscal Performance
Mr. Speaker, Grenada’s solid fiscal position weakened considerably in the first half of 2020 as revenues declined sharply and expenditure needs grew to cushion the economic blow dealt by COVID-19; the combined effect exerting a serious strain on Government’s finances.
By year end, the following results are expected relative to the Approved Budget.
- Current revenues of EC$654.2 million compared to a target of EC$786.2 million, a shortfall of EC$132 million.
- Grants of EC$114.6 million compared to a target of EC$218.6 million, a shortfall of EC$104 million.
- Taken together, current revenues and grants underperformed by EC$236 million as a direct consequence of the pandemic.
- Current expenditure of EC$620.1 million compared to a budget of EC$633.7 million.
- Capital spending of EC$122.1 million compared to a budget of EC$196.4 million.
- A primary surplus of EC $82.2 million compared to a target of EC$246.2 million
- An overall surplus of EC$26.6 million compared to a target of $170.6 million
The negative impact on Government’s fiscal position can be acutely seen when compared to the past 4 – 5 years.
The overall surplus of EC$26.6 million or 0.9% of GDP pales in comparison with overall surpluses generated during the period 2014 – 2019, which averaged 3.8% of GDP.
Also, the estimated primary surplus of EC$82.2 million, or 2.9% of GDP, is significantly smaller than those recorded in the past five consecutive years, which averaged 5.3% of GDP.
2.2.3. Public Debt Developments
Mr. Speaker, significant progress was made in reducing Grenada’s debt vulnerabilities and in regaining international creditworthiness. Our public debt to GDP ratio fell from 108% in 2013 to under 60% at the end of last year. This is a significant achievement by any standards.
The severe disruption in economic activity this year necessitated new borrowings of long-term concessional loans from multilateral creditors to help address the socio-economic fallout from the COVID-19 pandemic. Accordingly, Mr. Speaker, and justifiably so, there will be a spike in our debt-to-GDP ratio by approximately 13%, to an estimated 69% of GDP.
Notwithstanding, our debt remains sustainable, and with the anticipated recovery in economic activity over the medium-term, it is expected that our debt would revert to its firm downward trajectory.
Once our economic recovery takes hold, Mr. Speaker, Government will redouble its efforts towards achieving the debt targets under the Fiscal Responsibility Law (FRL).
2.2.4. Unemployment and Social Dislocation
Mr. Speaker, the downward trend in unemployment in the past seven years which saw a historic low of 15.1% in the fourth quarter of 2019, was reversed to 28.4% in the second quarter of 2020, because of the economic shock, with 14,000 jobs being lost.
Many of our citizens who lost their jobs or source of income during this crisis, had nothing to fall back on and could not provide for themselves or their families.
3. Government’s Response to COVID-19 and State of Recovery
Mr. Speaker, the fallout from the pandemic could have been far worse for Grenada had it not been for the proactive and comprehensive response by Government, coupled with prudent fiscal management which has generated surpluses over the past few years.
Mindful of the potential impact of the virus on the health of our people and our health system, Government took swift action to strengthen our health system, including by adopting new Public Health Regulations to govern the national response to the pandemic, and by accelerating our pandemic preparedness capabilities through upgrading health facilities and equipping them with isolation capabilities, and increasing health expenditure to allow for more environmental health officers, personal protective equipment as well as public awareness campaigns.
Government also took decisive action to save jobs and protect livelihoods. A Supplementary Budget was approved by Parliament in April 2020 to facilitate the rollout of a COVID-19 Economic Stimulus Package. A Secretariat was established as the dedicated and competent authority to oversee the rollout of the plan in an efficient and transparent manner. Through this package, Government provided temporary payroll support to hoteliers, restaurants, bars, and small travel agents in the tourism sector, and income support to public bus operators, taxi drivers, tourist vendors, and other hospitality-based businesses.
Additionally, Government increased funding to the small hoteliers’ facility and the small business soft lending facility at the Grenada Development Bank (GDB), and, also, eased the terms and conditions to access the funds. Government also temporarily deferred the monthly advance payment on Corporate Income Tax and the instalment payments on the Annual Stamp Tax, all in a concerted effort to help micro, small and medium-sized enterprises (MSMEs) to maintain operations and preserve jobs.
Furthermore, support was provided to farming communities, including supporting incomes of workers in the agro-processing and food exporting industry and providing key agricultural inputs, including labour, capital, and financial assistance. Moreover, Mr. Speaker, Government has committed to provide price support to the Grenada Cooperative Nutmeg Association (GCNA) and Grenada Cocoa Association (GCA), aimed at ultimately protecting the livelihoods of male and female farmers. Mr. Speaker, as recently as Friday, November 27, a $1.0 million grant was handed over to the GCNA as price support to our nutmeg farmers.
Going forward, Government will continue to ramp up support to the agricultural sector aimed at promoting food and nutrition security, reducing the food import bill, and improving operations of the two cooperatives, among other strategic priorities.
Mr. Speaker, the COVID-19 pandemic has laid bare social inequalities and exposed holes in our social safety nets, which have compounded gender disparities, with women being disproportionately affected. Therefore, to help cushion the social impact of the pandemic, Government suspended (for the period April to July 2020) the 2.0% increase in National Insurance Scheme (NIS) contributions that had been introduced in January 2020.
Additionally, Government, through the NIS, initiated a temporary unemployment benefit programme during the period April to September, 2020 at an estimated cost of EC$10.0 million. During the period, a total of 3303 persons (1805 women and 1498 men) received unemployment benefits.
Mr. Speaker, given the continued impact of the pandemic on economic activity and unemployment, Government has approved an extension of the unemployment benefit programme to January 2021.
Given the absence of a formal unemployment benefit scheme, Government plans to develop a formal contributory unemployment benefit programme to be administered by the NIS. As a clear testament of Government’s overall commitment to enhancing social protection systems and improving the delivery of social services, Cabinet has already approved a consultancy to design the framework for this programme.
Mr. Speaker, Government has worked assiduously to mobilise concessionary financial resources to offset the significant shortfall in its revenues and grants. To date, Government has mobilised EC$160.9 million in financial support and debt relief from its regional and international partners to help cushion the effect of the pandemic. Mr. Speaker, Government will continue with these efforts to ensure that we continue to build our preparedness and resilience in this time of great uncertainty.
Mr. Speaker, our efforts in this regard have set the stage for a robust and inclusive recovery. Indeed, Mr. Speaker, the road to recovery has already begun, with real GDP expected to rebound in 2021, albeit from a low base. Further strengthening is expected in 2022 and beyond.
Mr. Speaker, preliminary data suggests that the unemployment rate is already declining, estimated to reach around 20% by year-end, as many sectors, including construction, agriculture and wholesale and retail, continue to normalise.
4. Major Achievements in 2020
Mr. Speaker, despite the major disruption caused by the pandemic, which threatened to make 2020 a lost year, we can boast of several major achievements.
I wish to highlight some of the successes in health, education, agriculture, and youth empowerment.
- The upgrading of existing health infrastructure. Several medical centres and health stations were refurbished, including in Woburn, Good Hope, Perdmontemps, and Grand Anse. The upgrading of the Nurses Hostel at Princess Royal in Carriacou was also completed. Despite delays, the replacement of one of the elevators at the General Hospital was completed.
- The construction of new health infrastructure. An Isolation Ward was constructed at the General Hospital, which enhances the capacity to respond to and provide essential care and services in the fight against communicable diseases, such as COVID-19.
- Retrofitting of facilities. As part of the Smart Healthcare Project, several health facilities, including the Hillsborough Health Centre and the Princess Alice Hospital, were retrofitted to incorporate climate smart technologies in the health infrastructure.
- Laboratory systems upgrades were also completed.
- On the issue of sustainable health financing, work advanced on the National Health Insurance (NHI) project, including the completion of the draft legislation.
- Mr. Speaker, progress was also made in strengthening health care delivery and access to care, including through the procurement of equipment and essential supplies.
- E-Learning Agenda. Mr. Speaker, significant progress was made in advancing Government’s e-learning agenda, through the procurement of a learning management system and 24,200 e-learning devices for use by teachers and students.
- Capacity Building. Seventy-seven (77) teachers received financial assistance to facilitate long-term training and degree completion.
- School infrastructure. Significant progress was made in upgrading school infrastructure through rehabilitation and maintenance.
Agriculture and Fisheries
- Construction contracts at a value of EC$46.8 million, under the Agriculture Feeder Roads Phase III project, have been signed, and the sod was turned for the start of work in Grenada and Carriacou. Preparatory works for the construction of several other agriculture feeder roads, under the Smart Agriculture and Rural Enterprise Project (SAEP), were completed.
- Government approved EC$5.0 million for twelve agriculture initiatives under the World Bank-supported Agriculture Competitiveness (AGRICOM) project.
- Financing was provided through the Grenada Development Bank (GDB) to the tune of EC$1.7 million to Micro, Small and Medium-Sized Enterprises (MSMEs) within the agriculture and fisheries sector.
- Government increased farm labour support by over 330%, which created over 1,000 temporary jobs and benefited 442 farmers.
- The Ministry of Agriculture submitted a EC$4.0 million Agriculture Youth Entrepreneurship project proposal to the CARICOM Development Fund (CDF), which will support Government’s thrust to boost youth involvement in the sector. Preliminary feedback has been very promising.
- Government provided a grant of EC$1.0 million to the Grenada Cooperative Nutmeg Association to provide price support payments to nutmeg farmers.
- Over 2,000 young people benefitted from on-the-job training and scholarship opportunities.
- Several youth programmes were reintroduced at the parish and national levels, including the Youth Parliament and the Youth Ambassadors.
- Training and entrepreneurial support were provided under the M-Power 2.0 project to 360 young men, to help start their businesses or find gainful employment.
- Continued the Community Youth Rehabilitation Programmes, such as the Fostering Level-Headed Youths Project (Project FLY) and the Actively Committed & Empowered Project (Project ACE).
- Upgraded the Youth Development Centre.
- Rebranded, strengthened, and expanded the small business unit from the Grenada Youth Enterprise Initiative to YUTBIZ, to provide micro financing opportunities to young Grenadians.
These are only a few of our many achievements under difficult circumstances, Mr. Speaker.
While we are indeed proud of our many achievements this year, we are mindful of the challenging journey ahead.
I will now turn to the theme and strategic focus for the 2021 Budget.
5. Theme and Strategic Focus of the 2021 Budget
Mr. Speaker, our National Sustainable Development Plan (NSDP) for 2020 – 2035, which was laid before this Honourable House in November 2019, articulates the following shared vision: “Grenada, a resilient and prosperous nation, with a conscious and caring citizenry, promoting human dignity, and realising its full potential through sustainable economic, social, and environmental progress for all.”
The impact of COVID-19 has underscored the importance of steadfastly pursuing this shared vision for our people. It has also underscored the importance of being nimble, flexible, and adaptive as we plan for our future.
Indeed Mr. Speaker, the NSDP is crucially important to guide the formulation of strategic policies that prioritise inclusion, equality and sustainability to support our economic recovery in the short-term and our economic transformation over the medium-to-long term.
In deciding on the strategic focus for the 2021 Budget, Government consulted widely with key stakeholders and there is consensus on the following:
The most urgent priority is restoring hope in our people and supporting the recovery of our economy.
Second, we must continue to push ahead with our efforts to modernise and transform our economy to meet the new demands of this dynamic global landscape.
And third, we must continue to strengthen community-level and nationwide resilience to various shocks, be they economic or environmental, or shocks to our health and education systems.
Without these efforts, our country will be trapped in a vicious cycle of low growth, high unemployment and rising debt.
This 2021 Budget must therefore address the immediate challenge of getting us out of the economic downturn that we are currently in and putting us back on track towards achieving our shared vision.
Mr. Speaker, I am pleased therefore to present the 2021 Budget under the theme: Towards Vision 2035: Recovery, Transformation, and Resilience.
6. Outlook for 2021
Mr. Speaker, we are projecting a return to positive economic growth in 2021.
The agriculture, construction, wholesale and retail sectors will drive this recovery. Other key sectors, including tourism and private tertiary education, are projected to recover much slower and will continue to affect the speed of our recovery. Overall growth of 6.0% is projected next year.
Notwithstanding this relatively strong rebound in GDP, the nominal dollar value of national output in 2021 will be below pre-COVID-19 levels.
Mr. Speaker, we project that the growth in revenues will remain flat next year. While some areas are expected to show modest increases, many major tax types, including the Corporate Income Tax and the Personal Income Tax, will decline given that they are based on the 2020 economic performance.
Mr. Speaker, significant efforts will be made to contain discretionary recurrent spending to allow for greater recovery spending on the capital side.
In keeping with this objective, Mr. Speaker, the provision for recurrent spending, excluding the amount of EC$13.4 million allocated as a Contingency Provision, is less than the estimated outturn for this year.
An expanded capital investment programme will be rolled out next year to support economic recovery and job creation.
Government will strategically prioritise the Public Sector Investment Programme and strengthen systems and capacity to increase the implementation rates of projects and programmes that are deemed to best support resilient, inclusive growth and job creation
Mr. Speaker, in light of the foregoing, an overall deficit after grants of EC$18.2 million, is projected in 2021. This deficit will be financed from budgetary support from the World Bank and from monies that were being set aside to bolster our resilience to shocks.
7. Fiscal Measures
7.1. Revenue Measures
Mr. Speaker, there will be a strong drive to collect tax arrears. Our revenue collecting agencies will continue their efforts to improve the administration and collection of revenues to not only ensure that we all pay our fair share, but to also facilitate an improved taxpayer experience.
Furthermore, the Ministry of Finance will undertake a review of all Government services and fees by the first quarter of next year and make recommendations to the Cabinet for updating this list of fees and services.
7.2. Expenditure Measures
Mr. Speaker, Government remains committed to reducing wastage and improving the efficiency of spending.
In 2021, Government will be implementing recommendations from the recently completed Public Expenditure Review, to improve efficiency and ensure that expenditures are aligned with the Government’s strategic development priorities. Government will also strengthen its internal audit capacity with support from the World Bank to conduct risk-based audits to help strengthen our expenditure management framework.
Additionally, Government will target specific areas for expenditure rationalisation, which will save millions of dollars.
- A freeze on hiring in all truly vacant positions – approximately EC$11.0 million in savings. Mr. Speaker, it is important to clarify that these are positions for which there are no substantive holders appointed by the Public Service Commission, and no officers holding contracts, acting, or serving probationary appointments against these positions.
- An overall 20% reduction in utilities (electricity, communication expenses, and water) – approximately EC$6.0 million in savings.
- A 75% reduction in overseas travel – approximately $700,000 in savings.
Government has made an appeal to public sector trade unions regarding a deferral of negotiated salary increases for 2021, estimated to add EC$13.4 million to the wage bill. Further, Government is appealing for restraint in making any demands for wage and salary increases in 2021. Mr. Speaker, these measures could go a long way in helping to preserve jobs in both the public and private sectors, in this extended period of economic uncertainty.
Government remains hopeful that as a nation we will find common ground on this issue of wage and salary increases to help protect jobs in this challenging period.
I now turn to the Estimates of Revenue and Expenditure and the specific areas of intervention for 2021.
8. Estimates of Revenue and Expenditure for 2021
Consistent with the imperatives for recovery, transformation, and resilience, the 2021 Estimate of Expenditure provides for a total expenditure (including amortization) of one billion, two hundred and thirty-two million, six hundred and seventy thousand, and forty-nine dollars ($1,232,670,049).
The overall budget is summarised as follows:
Recurrent Revenue: EC$653.5 million
Total grants: EC$263.6 million
Current Expenditure: EC$629.6 million
Capital Expenditure: EC$305.6 million
Current Account Surplus: EC$23.9 million
Principal Repayments/Amortization: EC$297.4 million Primary Surplus (after grants): EC$45.5 million (1.5% of GDP) Overall Deficit (after grants): EC$18.2 million (0.6% of GDP)
The foregoing represents a loosening of Government’s fiscal stance relative to the pre-COVID period. This expansionary fiscal policy is needed at this time to stimulate aggregate demand, support the speedy recovery of the economy and enable job creation. To facilitate this, we have again invoked the Escape Clause under the Fiscal Responsibility Law.
Mr. Speaker, once the recovery takes hold, Government will return to the rules and targets under the FRL. We anticipate that this will happen in 2022.
Outside of statutory obligations, including public debt and pensions, the ten largest allocations, by Votes are:
- Ministry of Infrastructure Development, Transport and Implementation – EC$133.7 million (10.8% of total expenditure)
- Ministry of Education, Human Resource Development, Religious Affairs & Information – EC$124.0 million (10.1% of total expenditure)
- Ministry of Finance, Economic and Physical Development, Public Utilities & Energy – EC$119.9 million (9.7% of total expenditure)
- Ministry of Health and Social Security – EC$94.9 million (7.7% of total expenditure)
- Ministry of National Security, Public Administration, Youth Development, Home Affairs, ICT & Disaster Management – EC$73.3 million (5.9% of total expenditure)
- Ministry of Housing, Social Services, and Community Empowerment – EC$60.2 million (4.9% of total expenditure)
- Police – $51.6 million (4.2% of total expenditure)
- Ministry of Tourism, Civil Aviation, Climate Resilience and the Environment – EC$19.3 million (1.6% of total expenditure)
- Ministry of Agriculture, Lands & Forestry – EC$18.6 million (1.5% of total expenditure)
- Ministry of Sports, Culture & the Arts, Fisheries and Cooperatives – EC$17.6 million (1.4% of total expenditure)
More details on the 2021 Budget allocations are available in Appendix I of the published Statement.
8.3. Financing of the 2021 Capital Budget
As indicated earlier, Mr. Speaker, we will roll out an expansive capital investment programme next year, and justifiably so. Reducing investment in this period will only hurt the economy further.
Many countries across the world are pursuing this policy, and in some cases, are forced to borrow significant sums to finance their expanded investment programmes. Fortunately for us Mr. Speaker, our capital budget will be financed largely through grants from the National Transformation Fund (NTF), to the tune of $172 million. The $172 million will be secured from projected NTF grants for next year as well as the drawdown of NTF grants accumulated in previous years.
9. Strategic Interventions for 2021
9.1. Strategic Focus Area 1 – Economic Recovery
Mr. Speaker, promoting a strong and vibrant agriculture sector to ensure food and nutrition security continues to be a priority.
It is imperative therefore that we continue to appropriately invest in the sector to achieve the desired result.
Beyond the goal of food and nutrition security, a strong and vibrant agricultural sector will support economic growth, employment, and foreign exchange earnings.
In the current environment, the agriculture sector, already showing signs of a strong recovery, is one of the few sectors that offers the greatest potential to expedite our economic recovery.
We must therefore seize the opportunity to redouble our efforts to achieve a modern agriculture sector that includes value-added production, youth involvement, the application of relevant technology, capacity building, research & development, and adaptation to climate change.
Mr. Speaker, consistent with this thrust, Government will embark on the following key policies, programmes, and actions next year.
As part of the Climate-Smart Agriculture and Rural Enterprise Programme (SAEP), funded jointly by the Caribbean Development Bank, the International Fund for Agricultural Development, and the Government of Grenada, several initiatives will be implemented in support of strengthening the resilience of the agriculture sector to climate change and other shocks. A sum of EC$10.8 million has been allocated for implementation of this project next year. Approximately 140 persons will benefit from short-term employment opportunities under the Project, which will also support business development in rural areas, through the provision of grant financing to approximately 150 young people.
Mr. Speaker, youth involvement and the use of available technology are essential to achieving a modern agriculture sector.
Government, therefore, will continue to provide training and support to incentivise the participation of young people and the infusion of technology in the sector, including to address the long-standing challenges associated with praedial larceny.
The OECS Regional Agriculture Competitiveness Project (AGRICOM), which seeks to address issues relating to market access by small-scale farmers, fisherfolks as well as aggregators and agro-processors, will continue to be rolled out next year. An amount of EC$1.2 million has been allocated to support matching grants to eligible agricultural businesses.
Also, the enhancement of the Mirabeau Meat Harvesting and Processing Plant, with grant support from the CDF, is critical for the development of the livestock industry. This project will support the refurbishment of the facility and the procurement of equipment, along with training and improvements in procedures, to support the enhancement of meat harvesting and processing at the Plant.
Mr. Speaker, the agriculture sector is highly prone to climate change and weather-related shocks. Government will therefore continue to participate in the Caribbean Oceans Assets Sustainability Facility (COAST) and the Caribbean Catastrophic Risk Insurance Facility (CCRIF) to help protect the livelihoods of our farmers, fisherfolks, and agro-processors.
Additionally, Government is committed to engaging in public consultation on the subject of Cannabis. Research will be undertaken to determine the feasibility of the industry and develop proposals for the way forward. The investigations will be thorough, and science driven. An amount of EC$10,000 has been allocated to commence stakeholder consultations.
Mr. Speaker, while the allocation directly under the Ministry of Agriculture, Lands, and Forestry for this year is EC$18.6 million, the overall allocation for this sector is significantly larger.
Several projects, including the Agriculture Feeder Roads and the SAEP project, are allocated under various other ministries. When combined, agriculture’s share of total spending in the 2021 Budget will exceed EC$40 million.
9.1.2. Infrastructure Development
Mr. Speaker, high quality public infrastructure is a necessary condition for economic growth and transformation. In this crisis period, investing in resilient infrastructure will play a central role in driving the recovery, in creating jobs, and in preparing the economy for future take-off.
Against this backdrop, Mr. Speaker, Government will scale up its infrastructure development in 2021. A key component of this, Mr. Speaker, is increasing Government’s capacity to prepare and implement capital programmes.
Several organisations, including the Green Climate Fund and the World Bank, are supporting Government’s efforts in preparing designs and other preparatory works, as well as providing support to complete shovel-ready projects, which will help to boost the overall rate of project implementation.
In 2021, Mr. Speaker, the Public Sector Investment Programme (PSIP) will generate in excess of 4,500 direct jobs, creating a significant boost to economic activities and putting much-needed cash into the hands of workers.
Some of the major infrastructure projects for 2021 will include:
Grenada Climate Resilience Water Sector Project (G-Crews)
This EC$125 million project, which is jointly funded by the Green Climate Fund, the German Government and the Government of Grenada, was officially launched in February this year.
The major infrastructure developments under this project include, improvement in the water supply at Mirabeau, Les Avocats/Petit Etang, Vendomme, Victoria and St. Patrick. The water supply in Gouyave and Carriacou, will be expanded. The procurement of key experts, development of operations policies and procedures, and personnel training, are ongoing. Construction components of this critical project will commence next year, and will generate at least 50 jobs.
Enhanced Direct Access (EDA) Project
This is a regional project financed through a grant of EC$54 million from the Green Climate Fund (GCF). The objective of this project is to make accessible grant resources for climate change resilient investments to the public sector, NGOs and civil society organisations, and communities. Implementation of this project commenced in 2020 with the recruitment of a local project coordinator and technical officers. A sum of EC$3.2 million has been allocated for the rollout of this project in 2021.
Maurice Bishop International Airport (MBIA) Upgrade:
Mr. Speaker, the EXIM Bank of the People’s Republic of China has approved a concessional loan for the upgrade of the Maurice Bishop International Airport (MBIA). Construction cost, estimated at EC$165 million, will include rehabilitation of the runway and bypass road, and upgrade of the passenger terminal to enhance disaster response capabilities. The project was officially launched in October, and construction activities will commence in 2021, and will generate close to 200 local construction jobs.
Additionally, Mr. Speaker, on November 11th the World Bank approved funding under the Caribbean Regional Air Transport Connectivity Project (CATCOP) in the amount of US$17.0 million for additional safety and resilient works on the MBIA to be undertaken concurrently with the Chinese funded project. CATCOP will provide a new cargo facility, runway end safety areas, capacity building, and advanced safety and landing instrumentation.
Grenville Commercial Complex
This project will be a major undertaking by Government in the town of Grenville. While the main aim of the project is to house our District Revenue Office and the Public Library, the project will also facilitate the rental of commercial space to support the growth and expansion of the private sector in the parish of St. Andrew and surrounding areas. The preparatory work for the project is well advanced and construction will commence early in 2021. An amount of EC$8.0 million is allocated for spending next year, and an estimated 60 construction jobs will be created.
St. John’s River Flood Control Project
The construction on this crucially important project with a total cost of EC$27 million is scheduled to commence in February next year, generating in excess of 100 jobs. The consultant for the project has been engaged and design works are ongoing. An amount of EC$10 million has been allocated for 2021.
St. Patrick Road Rehabilitation and Upgrading Project:
Mr. Speaker, this project is funded through a loan of EC$27 million from the OPEC Fund for International Development (OFID). The scope of works entails the construction of 16 Km (9.94 miles) of roads, including all bridges, drainage and ancillary works from Duquesne to Sauteurs and from Poyntzfield to Morne Fendue. Construction works are ongoing. The Project is expected to generate up to 150 construction jobs over the next two years. The sum of EC$15.0 million is allocated for the continuation of this project in 2021.
Natural Disaster Rehabilitation & Reconstruction/Gouyave Extreme Rainfall Project.
During 2021, construction works will commence on this US$8.6 million project with funding from the Caribbean Development Bank (CDB). The project involves slope stabilisation in areas such as Brothers, Clozier, Gross Point,Maran, Market Square and Millette and the Brothers’ Bridge reconstruction. A sum of EC$1.1 million is allocated for the rollout of this project in 2021, which will generate 100 construction jobs.
Basic Needs Trust Fund (BNTF) Ninth Cycle
Mr. Speaker, the ninth cycle under the BNTF, with grant funding from the Caribbean Development Bank, commenced in 2020. A sum of EC$5.6 million is allocated for the continuation of this major poverty reduction programme next year, with approximately 20 jobs to be generated from construction activities under this project.
Grenada Education Enhancement Project (GEEP) Phases 1 & 2
Mr. Speaker, rehabilitation and upgrade works under Phase 1 of this EC$42.5 million, CDB-funded project, are progressing smoothly. Several schools were targeted this year, including the Bishop’s College, the Presentation Brothers College, and the Grenada SDA Comprehensive, which generated in excess of 80 jobs. Phase II of the Grenada Education Enhancement Project, at an estimated cost of EC$40.5 million, will be presented to the CDB Board later this month. The realisation of this project will see the construction and rehabilitation of several schools throughout the country, including the St. Andrew’s Anglican Primary and the Grenada Christian Academy. A sum of EC$7.5 million is allocated for the furtherance of this project, with additional jobs opportunities to come on stream.
Integrated Solid Waste Management Project (ISWMP)
Mr. Speaker, good progress, was made in advancing this EC$40.9 million CDB- funded project during 2020, including the design and award of the tender for the landfill cell development, the completion of the composting feasibility study, and the engagement of the Planning and Capacity Building Consultants. Furthermore, Mr. Speaker, the procurement process was completed for the acquisition of one Compactor Truck, one Tipper Truck with Crane, one Skip Truck and one Air Compressor for use within the Authority. Several other activities are on schedule for completion in 2021, including the closure of the two existing dumpsites. This Project is expected to generate direct employment for 25 persons. Mr. Speaker, Government will continue to push forward on this project next year to permanently relieve the problems being experienced, particularly by residents in the area.
Western Main Road Corridor Upgrade Project
This important project, Mr. Speaker, is financed through a grant of EC$46.7 million from the Department for International Development (DFID) of the United Kingdom, under the UK-Caribbean Infrastructure Facility (UK-CIF). Mr. Speaker, the scope of works for the project has been finalised and includes land and road slippages in Molinere and Woodlands. To date, consultancy contracts for designs, including the geotechnical investigations, have been awarded. Construction activities will commence during the third quarter of 2021 and will generate approximately 250 jobs over a three-year period. A sum of EC$15 million has been allocated for the rollout of this project next year.
Mt. Kumar Road Construction
Mr. Speaker, the Mt. Kumar Road Construction is critical to ease the flow of traffic through the Mt. Moritz by-pass road as we move forward with the works on the Molinere land and road slippage. This project will be funded from NTF grants to the tune of EC$5.0 million and is expected to commence early next year, creating at least 30 jobs.
Grenada Water Supply Expansion System & Sewerage Improvement Project
This EC$34.8 million project is financed through a grant from the UK-CIF, with National Water and Sewerage Authority as the implementing agency. The goal of the project is to contribute to the strengthening of the water sector in Grenada, reduce water sector risks, improve the sewer system in the town of St George, and build resilience to the impact of climate change in the sector’s infrastructure.
To date, consulting firm Alpha Engineering from Trinidad and Tobago has been contracted to complete all storage, distribution, and pumping stations system designs for the project, with full construction anticipated to start during the third quarter of 2021.
Construction & Refurbishment of Government Buildings
Government will continue its drive to construct and rehabilitate Government- owned buildings to provide adequate space for its offices and reduce the outlay on rents. Preparatory works for several Government buildings are completed or underway. Work will commence on a cross-section of these buildings as early as January 2021, which will generate in excess of 100 construction jobs. Mr. Speaker, an allocation of EC$9.0 million is provided for this project next year.
Concrete and Asphalt Works
Mr. Speaker, maintaining our road infrastructure is critical not only for road safety but for supporting economic activity. This year, over $15 million was expended, which is a drop in the bucket in terms of what is needed. That said, it is impossible to do all that is necessary given our total resource envelope, and competing demands in other critical areas, such as health and education. Accordingly, Mr. Speaker, Government will continue to adopt a risk-based approach and address the most critical needs first. A sum of EC$14.0 million is allocated for concrete and asphalt works next year, with the potential to create over 1,500 construction jobs.
Simon Culture Centre
This Project, Mr. Speaker, will involve the construction of the Simon Cultural Centre in St. Andrew at a cost of EC$16.5 million. Financing will be through the National Transformation Fund, with up to 200 jobs created over three years. A sum of EC$3.0 million has been allocated for the roll out of construction works on this project next year.
Renovation and Extension Programme – Schools
Mr. Speaker, EC$2.7 million was spent on the renovation and extension of several schools during this year. An allocation of EC$3.0 million is made for next year. Some 600 construction jobs will be created under this programme.
Agriculture Feeder Roads Phase III
The implementation of Phase III of the Agricultural Feeder Roads Project, which was delayed due to the pandemic, has commenced and major construction roll-out will be seen in January next year, with over 200 construction jobs to be generated. Mr. Speaker, in contrast to Phases I & 2, this phase is financed from domestic resources. As already mentioned, construction contracts to the tune of EC$46.8 million have already been issued.
This phase involves the construction/rehabilitation of 44.2 km of roads, including bridges and ancillaries, in various communities across the island. A sum of EC$15.0 million has been earmarked for spending next year.
Retrofitting of Traffic Lights
Government will use this opportunity, Mr. Speaker, to incorporate renewable energy technologies in the retrofitting of our traffic lights, which should result in significant savings and environmental benefits. Given that traffic has doubled since the installation of our traffic lights, the advice given by New York University (NYU), while investigating the traffic situation under their consultancy for making the town of St. George a climate smart city, will be incorporated in the new designs. A sum of EC$3.0 million is allocated for this project.
Mr. Speaker, EC$4.4 million was spent on critical small infrastructure works, such as concrete pavements and walkways, railings, bridges, and public baths and toilets, in various communities throughout Grenada, Carriacou, and Petite Martinique. An allocation of EC$7.0 million has been provided for the continuation of this programme next year, which will create over 1,000 temporary job opportunities.
Mr. Speaker, I now turn to another key pillar that would drive economic recovery next year.
Support for Private Sector Expansion
Mr. Speaker, a vibrant private sector can play a major role in driving job creation and in bolstering the economic recovery.
In our interactions with stakeholders, several areas of support were flagged, including access to credit, concessions, and business facilitation services.
Some of this support has already been made available through the COVID-19 Economic Stimulus Package announced in March to cushion the adverse impact of the pandemic.
- The Small Hotel Facility at the Grenada Development Bank (GDB)
- The Small Business Soft Loan Facility also administered by the GDB
To complement this financing support, Government recently granted approval for the GDB to borrow $10 million to provide access to credit to support recovery across a range of economic sectors.
Government is also considering approval for GDB to access a line of credit from the European Investment Bank (EIB) and the CDF to the tune of US$10.0 million and US$4.0 million, respectively, to further bolster access to private sector credit.
Mr. Speaker, despite the pandemic, investor confidence in Grenada remained at an all-time high as the GIDC continues to receive significant interest for new investment opportunities, with several new major projects given the greenlight to proceed.
As of November 2020, forty-one (41) applications for investment incentives were received across various sectors, including tourism, manufacturing, and services. The proposed investments in these new projects will exceed EC$6 billion, with the potential to generate over 5,000 jobs.
Mr. Speaker, Government will continue to support our farmers, fisherfolks, and agro-processors to access markets, both locally and internationally.
In this context, Government will work with the Marketing and National Importing Board to improve its governance and financial performance, enabling it to better serve farmers.
Moreover, Government, through the Ministry of Trade, Industry and Consumer Affairs and the Grenada Bureau of Standards, will continue to work to boost export of our local products and services. The upgrading of the Grenada Bureau of Standards’ laboratory facilities, with EC$2.0 million in funding secured from the CDF, is key in this regard.
22.214.171.124. Major Private Sector Investments
I wish to highlight some of the major projects facilitated by the Government during 2020 as well as projects in the pipeline for 2021.
Projects commencing operations in 2020:
• SD Grenada Ltd. (Royalton)
This EC$300 million project, Mr. Speaker, involving the refurbishment and expansion of the “Grenadian by Rex Resorts”, commenced operation in March 2020. However due to the pandemic, the hotel closed its doors in the same month and is now scheduled to be reopened in January 2021, creating 300 direct jobs.
• The Point at Petite Calivigny Resort
Mr. Speaker, Phase 1 of this luxurious boutique resort commenced operation in January 2020, adding a total of 32 luxury rooms to Grenada’s current room stock.Despite the challenges of the pandemic, the facility is still open and employs 11 persons. Phase 2, which includes 65 hotel rooms and 15 villas, is scheduled to commence in early 2021. This phase of the project is estimated at EC$175 million and is anticipated to create construction jobs for up to 150 individuals. Estimated employment during operations is 65 persons.
• Siesta Hotel Expansion
This project located at Morne Rouge has added 20 rooms to the tourist accommodation sector and created construction employment for over 40 workers. It is expected to create employment for 7 persons once operation commences next year.
Students Accommodation facilities
• Waldorf Apartments
This project, Mr. Speaker, involves the construction of 120 apartments for student accommodation at True Blue, St. George. Total investment to date is EC$32 million. Employment was created for 110 persons during construction and permanent employment is proposed for 7 persons. The project is expected to become operational once the St. George’s University (SGU) resumes face-to-face classes.
• Renegade Rum Distillery Ltd
This project commenced operations in September 2020. Total investment in the project was over EC$100 million. Renegade Rum Group currently employs 150 persons: 25 within the distillery and 125 in the Cane Co side of the business.
Projects currently under construction
• Range Development
This EC$300 million tourism development commenced construction in October 2020 and will create construction employment for up to 350 persons and permanent employment for about 150 Grenadians when completed. This project is scheduled to commence operations in the first quarter of 2023.
• Kawana Bay
Work is currently underway on the fourth and final building of this project which is scheduled for completion in 2021. Investment to date is over EC$150 million, with up to 240 construction jobs created. The resort which will add 133 rooms and 31 suites to Grenada’s room stock, is expected to be operational in 2022, creating 300 permanent jobs.
• Grenada National Resort Project
Mr. Speaker, to date, over US$70 million has been invested in the acquisition of property and to undertake preliminary works, which included feasibility studies, surveys, site preparation and ongoing construction. The construction of this facility is expected to create employment for over 500 Grenadians within the parish of St. Patrick, of which 135 are currently employed. Once operational, up to 800 permanent jobs will be created for locals.
· Mt. Hartman Resort Group Ltd.
This US$2 billion project commenced construction of its showroom in August 2020, creating 50 construction jobs. The showroom will be constructed as a mini resort to feature 17 suites, a restaurant, business centre, and offices for staff. It is expected to be completed in June 2021. Construction employment is expected to increase significantly with the start of construction of the main resort and university town in January 2021.
This phase, which is expected to be complete in June 2024, will provide at least 500 job opportunities.
• Luxe Modern Residential Living
Construction works on this EC$9.7 million project located in Lance Aux Epines are currently ongoing, with over 20 persons employed. The facility is expected to become operational by March 2021 and will create permanent employment for at least 7 persons.
• VK Holdings Inc.
Mr. Speaker, this project involves the establishment of a small luxury eco- friendly tourism accommodation facility located in Quarantine Point. Phase 1 of the project which is estimated at EC$5.5 million is 75% completed. Some 23 persons are employed in the construction of the facility. It is expected to be operational in August 2021, creating employment for about 15 persons.
• Solamente Villas (Phase II)
This EC$10 million expansion project will add 10 rooms to an existing 10- bedroom luxury boutique villa resort and retreat centre at Lance-Aux-Epines. Construction employment has been created for 22 persons and permanent employment is proposed for 5-7 persons once operation commences next year.
• Karnani Investments Limited
Mr. Speaker, construction activities on this EC$3.8 million project are ongoing, with 45 construction jobs created. Permanent employment will be created for 5 persons upon commencement of operation in 2021.
Students Accommodation facilities
• Virgin Beach Development Co. Ltd
This EC$40 million project involves construction of 146 apartments for student housing at True Blue. Over EC$35 million has been invested in the project to date, with over 150 construction workers employed.
The project is expected to become operational once St. George’s University resumes face-to-face classes.
• Xenia Apartments
Mr. Speaker, this project involves the construction of a EC$1.8 million student accommodation facility at Point Salines, creating permanent employment for 8 persons. Forty (40) construction jobs have been created.
• Gafsons Investments (Grenada) Inc.
This EC$6.5 million project involving construction of 36 apartments for student housing at Lance Aux Epines, is ongoing, with over 35 persons employed.
• Crystal Sand Apartments
This student accommodation facility, Mr. Speaker, is estimated at EC$2.5 million and involves construction of 30 self-contained apartments for student accommodation.
Construction employment is proposed for 20 – 35 persons, with 6 persons employed once operation commences in December 2021.
• Lavo Housing Limited
The project, Mr. Speaker, involves the construction of a 24-bedroom student accommodation facility. The facility, which is 90% complete, employs over 40 construction workers. Investment to date is more than EC$6.5 million. The facility is expected to be operational in March 2021, creating employment for an average of five persons.
• Excellent Farm Ltd.
Construction on this EC$3.8 million poultry operation in St. Patrick is ongoing and will create permanent employment for over 20 persons once operational next year.
• Grenada Tobacco Company Limited
The proposed project cost is EC$7.8 million and involves the manufacturing of cigarettes, using fine imported blends, for 100% export. The project is estimated to employ a total of thirty (30) persons.
I now turn to some major private sector projects in the pipeline with planned commencement dates next year.
Projects in the pipeline to be implemented in 2021
• The Beach House Project
Mr. Speaker, construction on this EC$54 million project will commence in the first quarter of next year, creating over 100 construction jobs. The commencement of operations is scheduled for the third quarter of 2023, which will provide permanent employment for 75 persons.
• Silversands Legacy (at Mount Cinnamon)
The proposed construction start date for this EC$216 million project is the fourth quarter of next year, with the commencement of operations likely in the second quarter of 2024. The project will generate up to 300 construction jobs and employ at least 250 persons during operations.
• Grenada Chick Inn Farm Ltd
This project, Mr. Speaker, involves the establishment of a poultry operation in Felix Park, St. Andrew. Proposed investment is EC$4 million with the potential to create construction and permanent employment for over 80 persons. This project is scheduled to begin in early 2021.
• Homa Limited
Homa Limited is moving ahead with plans to develop a 240-room luxury resort, encompassing three properties located in True Blue. This EC$60 million project is carded for implementation in 2021. The project will create permanent employment for 25 persons when completed.
• Star Development Limited
This project is a 60-room luxury hotel and spa to be developed in three phases on 3.67 acres perched above Dr. Grooms Beach in Point Salines. This EC$56 million project, when completed, will create permanent employment for 15 persons.
Mr. Speaker, these and other private sector projects will generate in excess of 5,000 construction jobs and over 3,300 permanent jobs in 2021 and beyond.
9.1.3. Tourism and Private Tertiary Education
Mr. Speaker, our tourism and private tertiary education sectors, have been hit the hardest in this pandemic and are anticipated to be the slowest to recover.
This Budget provides for EC$19.3 million to support a new thrust, including the renewal of our tourism product offerings.
One example of this is the work that is unfolding under the OECS Regional Competitiveness Project. The project objective is to lay the foundation to improve the competitiveness of the tourism sector in Grenada.
With respect to the private tertiary education sector, Government will continue to collaborate closely with St. George’s University to facilitate a full return of all students and faculty to the SGU Campus, in the shortest possible time.
9.2. Strategic Focus Area 2 – Transformation
Mr. Speaker, I will now proceed to outline some specific areas that will support the social and economic transformation of our country.
9.2.1. Education and Training
Mr. Speaker, I join in congratulating our students for the excellent performance in this year’s CSEC examinations. This is a clear demonstration of the commitment and dedication of our educators and parents, the strength and tenacity of our students, and the resilience of our education system.
In 2021, the Ministry of Education will continue to build out these pillars.
Some of the key initiatives for next year include:
- The eBooks Programme – EC$6.0 million;
- The e-Testing Programme at a cost of EC$0.2 million;
- School infrastructure programmes (GEEP Phases I & II) – EC$7.5 million;
- National Skills Development Programme – EC$0.7 million; and,
- The STAR Programme – EC$0.5 million
Government will continue to support the education of our teachers and students through various scholarships at local, regional and international universities. We have allocated EC$124.0 million, to help drive the transformation agenda in the education sector.
Mr. Speaker, Government reiterates its commitment to prioritise the health of the Grenadian people. The recent appointment of a second Minister in the Ministry of Health with responsibility for Hospital Services and Community Health Services, sends a strong signal about the seriousness of Government’s commitment.
A key project in this regard is the World Bank supported OECS Regional Health Project, aimed at improving the preparedness of our health system to respond to public health emergencies. This project will strengthen health infrastructure, surveillance, laboratory systems, and health emergency operations.
Government will continue its efforts, Mr. Speaker, to ensure adequate dialysis services for our dialysis patients. Only recently, Cabinet approved the purchase of critical surgical and medical equipment and supplies to support the administration of dialysis.
The refurbishment of Carlton House to provide support to our citizens who are facing challenges with substance abuse cannot wait any longer Mr. Speaker. Government applauds the Grenada Co-operative Bank Ltd for recognising the importance of this facility and for their stellar efforts in raising resources toward its reconstruction. Government has provided the sum of EC$1.0 million to commence rehabilitation of the Carlton House next year.
Work will continue on developing an appropriate framework for a sustainable National Health Insurance (NHI) programme.
We have allocated EC$94.9 million in this year’s Budget towards improving health care delivery.
9.2.3. Youth Development
In 2021, the youth budget will see a 43% increase over the 2020 figure, to $40.4 million of which EC$17.9 million is allocated to the important New IMANI Programme.
Mr. Speaker, a significant change to the budget for youth development this year is the inclusion of a Transitioning Strategy Programme, which will complement the New IMANI Programme. This programme seeks to address the fundamental challenge associated with transitioning from the IMANI programme into sustainable jobs. Under the programme, service providers will be engaged to provide services to the Government and private sector, and they will in turn provide sustainable jobs to our young people. Several initiatives have already been rolled out, including a youth sewing cooperative that would be involved in the sewing of school uniforms and other clothing products, and a furniture-making cooperative. Mr. Speaker, a budget of EC$7.0 million has been allocated to facilitate the roll out of this programme next year.
The M-Power programme, Mr. Speaker, continues to touch the lives of our young men at risk. The allocation for this programme has been increased from EC$4.0 million this year to $6.0 million in 2021.
9.2.4. Digital Transformation
Mr. Speaker, Government remains committed to aggressively pursuing a digital strategy to harness and leverage information and communications technology (ICT). Government sees ICT not only as an enabler of economic activity, but, more importantly, as a new pillar of growth and transformation.
One of the key elements of Government’s digital strategy is ICT infrastructure. Significant progress has been made in this area under the World Bank- supported Caribbean Regional Communications Infrastructure Programme (CARCIP), which facilitated increased access to regional broadband networks as well as the development of IT and IT-enabled services in Grenada and the Caribbean region.
Another key element of this strategy is the digital transformation of Government’s operations and services. The continued roll out of the Digital Governance for Resilience Project (DG4R) will support developing the enabling environment to modernise service delivery; leveraging digital technologies to deliver selected services and strengthening institutions and managing change for digital literacy and inclusion.
9.2.5. Physical Development, Public Utilities and Energy
Mr. Speaker, Government will continue to implement key reforms and programmes in the area of physical development, public utilities, and energy.
Permit me to touch on these three areas briefly.
126.96.36.199. Energy Development and Public Utilities
Grenada has one of the highest rates of energy in the region at around US$0.41 per kilowatt hour. Mr. Speaker, Government will continue its efforts to diversify Grenada’s energy mix into renewable sources and to reduce the cost of energy.
The restructuring of the electricity sector, therefore, is of paramount importance. Significant progress has been made in this regard with the passage of the new Electricity Supply Act and attendant regulations. The Public Utilities Regulatory Commission (PURC) is now fully constituted and functional. Government will continue to press ahead with reforms in the electricity sector.
Mr. Speaker, plans for the development of a 15 Megawatt geothermal plant on the island are progressing smoothly. Government will continue to aggressively pursue this project, including by mobilising grant financing, to help support the reduction in the cost of energy to consumers.
The Solar PV/Battery Hybrid Project, with grant funding support from the United Arab Emirates – Caribbean Renewable Energy Fund, to the tune of EC$8.6 million, is another important project that will support Grenada’s thrust towards renewable energy. This project will facilitate the design, construction, and installation of a Solar PV/Battery Hybrid plant in Limlair, Carriacou. An allocation of EC$3.2 million is provided for the commencement of this project next year.
Mr. Speaker, developments in the water and telecommunications sectors, as public utilities, and their key role in sustainable development and the economic transformation process have been examined earlier.
188.8.131.52. Physical Development
Mr. Speaker, the orderly, safe and effective physical development of Grenada is a critical element of our transformation agenda.
For this reason, in January of this year, Government took the bold decision to implement the transition of the Physical Planning Unit under the Ministry of Finance into a full-fledged statutory body – the Physical Planning and Development Control Authority, contemplated since 2017 with the enacting of the legislative framework. Mr. Speaker, the pandemic affected the speed of our efforts on this important reform. In 2021, Government will accelerate the finalisation of the transition.
9.3. Strategic Focus Area 3 – Resilience
Mr. Speaker, Government will continue to prioritise building resilience to shocks, both economic and environmental.
The 2021 Budget supports this thrust, with many of our policies and programmes designed with resilience considerations in mind.
Furthermore, Mr. Speaker, Government will continue to implement its Paris climate commitments in the fight against the threat of climate change.
Grenada’s commitment through its revised Nationally Determined Contribution of reducing its emission by 40% of its pre-2010 level by the year 2030, will be pursued vigorously. With the electricity and transport sectors accounting for over 70% of our carbon footprint, efforts will be concentrated on reaching at least 30% of electricity generation through renewable energy, and 20% of vehicles being powered by renewable energy sources within the 2030 deadline. Additionally, Government will continue its efforts to reduce the leakage of plastics to our pristine but vulnerable coastal and marine environments as well as the amount of plastics that reach the landfill.
9.4. Cross-cutting Areas
Mr. Speaker, there are several cross-cutting areas, which are crucially important in supporting the three strategic focus areas for 2021. These include social safety nets, housing and community empowerment, disaster management, national security, developments on Carriacou & Petite Martinique, gender equality and women empowerment, among others.
I will now briefly touch on a few of these areas.
9.4.2. Safety Nets (Poverty Alleviation)
Mr. Speaker, notwithstanding the tight fiscal situation next year, Government will increase its social safety nets/poverty alleviation programmes.
Allow me to outline some of the major poverty alleviation programmes for 2021.
- Support for Education, Empowerment and Development (SEED) – EC$18.0 million, an increase by EC$4.0 million relative to the 2020 Allocation.
- Road Improvement and Maintenance Programme (De-bushing) – EC$10.0 million
- Farm Labour Support/Strengthening Rural Opportunities – EC$1.5 million
- Needy Assistance – EC$1.4 million
- Uniform Allowance – EC$1.0 million
- Burial Assistance – EC$0.3 million
Mr. Speaker, Government will introduce a new safety net to provide support to single-headed households to cushion the impact of the continued adverse effects of the pandemic. An amount of EC$2.0 million has been allocated for this programme. The total allocation, Mr. Speaker, for the Ministry of Housing, Social Services, and Community Empowerment is EC$60.2 million, an increase of 28.6% over 2020.
Mr. Speaker, Government will continue to give top priority to the housing needs of our people, especially the less fortunate.
With support provided by the People’s Republic of China, a total of 647 low- income housing units will be available for distribution during the course of next year.
Mr. Speaker, there are several other major areas of housing assistance available next year.
- Housing Assistance programme – $5.0 million
- Grenada Home Improvement Programme – $10.0 million
- The Soft Loan Housing Programme – $4.0 million.
9.4.4. Disaster Management
Past events, Mr. Speaker, have mandated that we broaden our perspective of a disaster – weather, geological, technological (data loss), disease, etc.
With support from the United States Southern Command Humanitarian Assistance Programme, Grenada will benefit from two emergency operations centres – one on the mainland to also serve as headquarters for the National Disaster Management Agency, and one on the sister isle of Carriacou. Construction is estimated at a cost of US$6.6 million. Mr. Speaker, EC$4.7 million has been allocated in 2021 for the continued implementation of these two centres.
9.4.5. Pension Reform
Mr. Speaker, I am pleased to report that Government continues to make good on its commitment to provide relief to retired public officers, pending the legal outcome of the matter of pension for public officers. Close to $340,000 was paid out this year. This is a clear testimony that this Administration is serious about resolving the long-standing issue of public sector pensions.
Government, once again, reiterates its commitment to working collaboratively to reform the public sector pension system in a way that balances the interest of the workers with the need to ensure long-term fiscal and debt sustainability.
9.4.6. Carriacou and Petite Martinique Affairs
Mr. Speaker, we are also making important strides in our sister isles of Carriacou and Petite Martinique to support growth and development.
Some of the major achievements this year include;
- The rehabilitation of the Limlair Farm;
- The construction of propagation bin and the installation of a hydroponic system at the Belair Nursery;
- The re-establishment of fish exports to French Martinique;
- The rehabilitation and construction of several roads across Carriacou and Petite Martinique;
- Several families received housing support.
- The Dumfries Housing project with support for the Chinese is nearing completion.
- The award of a contract for a major agriculture feeder road in Cherry Hill.
Mr. Speaker, Government will continue to roll out critical projects in Carriacou and Petite Martinique in several areas, including agriculture and fisheries, infrastructure development, housing, social services, and community empowerment, youth development, among other areas.
The total Budget for Carriacou and Petite Martinique for 2021 is EC$17.2 million, which represents a slight increase over 2020.
9.4.7. Sports, Culture & the Arts
Mr. Speaker, Government remains committed to the development of sports, culture, and the arts as a priority given their significant role in the transformation of our economy and people. While activities in these areas have been significantly curtailed by the COVID-19 pandemic, Government has allocated EC$12 million for the continued development of these critical areas.
9.4.8. National Security
Grenada, Mr. Speaker, is considered one of the safest countries in the Caribbean region, given our relatively low homicide rates and crime levels. Moreover, we continue to see improvements in our crime fighting efforts, with a reduction in reported cases of all major categories of crime, except in areas such as praedial larceny and house-breaking. That said, we cannot rest solely on our reputation and become complacent.
Government notes with concern the increase in homicides in recent times and, therefore, appeals for greater tolerance, the use of alternative methods of conflict resolution, and more respect for the value of human life.
The Royal Grenada Police Force (RGPF) is committed to collaborating with stakeholders as part of a holistic approach to fighting crime. The allocation for the RGPF and Her Majesty’s Prisons for next year, Mr. Speaker, is EC$51.6 million and EC$9.6 million, respectively.
9.4.9. Women Empowerment and Gender Equality
Mr. Speaker, I am pleased to report that the preparation process for the critical Spotlight Initiative project is ongoing. The focus of the project is to eliminate violence against women and girls. Support for the project is provided by the UN system, ILO and PAHO/WHO. A grant of 2 million Euros has already been committed.
Mr. Speaker, the EnGenDer programme, which is short for “Enabling Gender- Responsiveness Disaster Recovery, Climate and Environmental Resilience in the Caribbean” with support from the UNDP is another project in this area that will contribute to the achievement of several Sustainable Development Goals (SDGs). A sum of $0.3 million has been allocated for this project in 2021.
Mr. Speaker, let me once again thank the Honourable Prime Minister for his confidence in me to lead the Ministry of Finance at this time.
I also take this opportunity to thank my other Cabinet colleagues for their support.
Further, I wish to recognise the valuable contribution made by the Cabinet Secretary in handling the affairs of the executive branch of Government, and also Permanent Secretaries, for their collective contribution to national development.
A special thank you to the Permanent Secretaries and staff of the Ministry of Finance, as well as the Clerk of Parliament and his staff, who have given me their full support and who have had the enormous task of preparing the 2021 Budget and facilitating my presentation today.
Mr. Speaker, I recognise and thank all other public workers, and I look forward to their continued enthusiasm as we work collaboratively to execute the plans announced in this 2021 budget. In this whole of Government approach, every link in the chain matters.
I once again express thanks to stakeholders in the private sector, non- governmental organisations, faith-based organisations, trade unions, civil society and youth organisations which participated in the consultations on the 2021 Budget in September, for contributing valuable ideas and suggestions for economic recovery, transformation and resilience.
Mr. Speaker, I wish to express sincere thanks and appreciation to my constituents of St. George South East, for the continued support and confidence in my representation in this Honourable House.
Mr. Speaker, on behalf of the Government of Grenada and people of our beautiful nation, I would like to thank the following governments and institutions, for providing financial, economic, and technical assistance during the past year.
The Government of the People’s Republic of China
The Government of the Bolivarian Republic of Venezuela
The Government of the Republic of Trinidad & Tobago
The Government of the Republic of Cuba
The Government the Federal Republic of Germany
The Government of New Zealand
The European Union
The Government of Japan
The Government of the United Arab Emirates
The Government of Mexico
The Government of the Kingdom of Morocco
The Government of the Federative Republic of Brazil
The Government of the Republic of Turkey
The Government of the Republic of Kazakhstan
The Government of the Republic of Korea
The Government of the Russian Federation
The Government of the Republic of France
The Government of the Republic of Chile
The Government of the Argentine Republic
The Government of Costa Rica
The Government of the United Kingdom and the Department for International Development
The Government of Canada and the Department of Foreign Affairs and Development (DFAD)
The Government of the United States of America and the United States Agency for International Development
The Federal Republic of Germany
The Caribbean Development Bank
The Kuwaiti Fund for Arab Economic Development
The OPEC Fund for International Development
The Eastern Caribbean Central Bank
The Organisation of Eastern Caribbean States (OECS)
The Caribbean Regional Technical Assistance Centre (CARTAC) The CARICOM Secretariat
The CARICOM Development Fund (CDF)
The International Monetary Fund
The World Bank Group
The United Nations Development Programme
The United Nations Population Fund
The United Nations Children’s Fund
The United Nations Educational Scientific and Cultural Organization (UNESCO)
The United Nations Environmental Programme (UNEP)
The Food and Agriculture Organisation (FAO) of the United Nations
The Organisation of American States (OAS)
The Global Environmental Facility
The Inter-American Institute for Co-operation on Agriculture
The Caribbean Export Development Agency
The Commonwealth Secretariat and Commonwealth Fund for Technical Cooperation (CFTC)
The International Fund for Agricultural Development (IFAD)
9.6. Conclusion – Stronger Together, Under GOD
Mr. Speaker, this NNP Administration is once again faced with the great responsibility of leading our nation out of adversity.
On this occasion, we are confronted with a crisis of unprecedented proportions. This is unlike anything we have seen before.
The Great Lockdown, as it is referred to, has led to the worst economic downturn since the Great Depression of 1929.
All across the globe, governments are grappling with the social and economic fallout of the COVID-19 pandemic.
Here at home, the pandemic has triggered an unparalleled decline in our economy, resulting in serious hardship for many of our people.
The pandemic has also compounded our major developmental challenges, including a still high rate of unemployment and continuing debt vulnerabilities.
If we are not vigilant, many of our hard-won gains will be permanently reversed.
Mr. Speaker, this is arguably the most difficult period we have had to face in our economic history.
Overcoming our current challenges, therefore, requires an extraordinary response.
Mr. Speaker, as a nation and a people, we are responding well. Working together, hope in our nation and our people is being restored.
Our economy is beginning to show initial signs of recovery. Our people are demonstrating impressive resilience.
Mr. Speaker, as we have done before, with God on our side, we will prevail.
The policies, plans, and programmes announced today will help us recover in a robust and inclusive way, support our social and economic transformation, and further build resilience.
We have rolled out one of our largest capital budgets ever, which will generate thousands of employment opportunities for our people. Our private sector is energised and will also add thousands of new jobs.
Mr. Speaker, we are ready for the difficult road ahead.
The responsibility resides with all of us. As a caring and responsible Government, we will play our part. I call on each and every Grenadian to continue to do his or her part as we move forward in unity and from strength to strength.
The more united we are, the stronger will be our response and the sooner we will be able to put the pain and suffering of 2020 behind us.
Mr. Speaker, I end as I began in reverence to the Almighty God “for in him we live, move, and have our being.” We are not afraid of what the future holds. For God is our refuge and strength, an ever-present help in trouble. Psalms 46.1.
I want to also end by thanking my family for their love and unwavering support in my many years of service to our nation.
May God continue to bless Grenada, Carriacou and Petite Martinique. I thank you.
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