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Wednesday, October 31, 2012


An economic crisis can change the face of things and in dramatic fashion, too. Undoubtedly, the SLP gov’t has a sublime mix of pro-poor social programmes (like STEP, NICE, SMILES etc); and yet, its economic and fiscal policies look distinctively “pro-republican”. This begs the question, “does St. Lucia have pro-democratic social policies and on top of them she has a pro-republican economic policy?

Impulsively, we may be tempted to rush to judgement and claim that the answer is a “resounding yes”, especially in the context of the mammoth VAT "cuts" and the proliferation of never-ending concessions granted to the hotel sector, with the bills being footed by the poor and working class of this country! 

But let’s be downright honest and agree that the answer is not as “linear” as we may think!

The hotel sector can turn the argument on its head and say “I offer hundreds of jobs – directly and indirectly - to the poor and I assist significantly in both the social and economic advancement of the country”. And this holds much water.

So how do we reconcile the contrasting but equally tenable positions? The answer lies in their conflation.

The fact is the two sectors are ostensibly mutually indispensable, with one sector being “more vulnerable” and the other being “more viable”. For a clearer perspective, let us summarise the arguments in the context of two hypothetical principles connecting “development” with “vulnerability” and try to rationalize the puzzle!

Principle 1: vulnerability varies inversely with development (VVID)
Principle 2: vulnerability varies directly with development (VVDD)

Principle 1 (VVID) suggests that vulnerability decreases as development increases. We generally tend to embrace the economic belief that development leads to growth - and that growth is potentially a general panacea for our economic and social problems including the reduction of vulnerability.  Indeed this “model” may work very well for the wealthy but it does not always work for the poor.

Principle 2 (VVDD) on the other hand implies that vulnerability increases with development. It is a principle embraced by institutions such as the World Bank (WB) the Caribbean Development Bank (CDB) and Canadian International Development Agency (CIDA).

Both principles and the models they support have merit. 

While development is indisputably essential and invariably leads to economic expansion, progress and transformation, it also creates vulnerabilities. Development will make a country wealthy (or wealthier) but it does always solve poverty; in fact, it is well documented that it can also result in more poverty and displacement. 


St Lucia tops in CARICOM for ease of doing business, says World Bank

NEW YORK, USA, Wednesday October 31, 2012 – St Lucia is the top-ranked CARICOM country for ease of doing business, according to the 2013 World Bank Doing Business rankings.

St Lucia copped the top CARICOM spot for the second straight year, ranking 53rd worldwide on the list, although that represented a minimal drop from its ranking of 52nd in the 2012 report.

Puerto Rico placed highest overall in the Caribbean for the ease of doing business, coming in at 41st out of 185 countries worldwide.

‘Doing Business 2013: Smarter Regulations For Small and Medium-Sized Enterprises’, released last week, explores how business-friendly regulations in each of the territories are, covering areas from starting a business to resolving insolvency.

This year’s 282-page report covered data measured from June 2011 through May 2012.

Coming in at second in CARICOM was Antigua and Barbuda, which was ranked 63rd overall, followed by Dominica at 68th, Trinidad and Tobago at 69th, and St Vincent and the Grenadines at 75th.

The Bahamas was ranked 77th, ahead of Barbados at 88th, Jamaica at 90th, St Kitts and Nevis at 96th, and Grenada at 100th.

Belize, Guyana, the Dominican Republic, and Suriname trailed behind, with Haiti occupying the lowest ranking in the region at 174th.

Worldwide, Singapore topped the rankings for the seventh straight year.

Source: Read more:

Friday, October 26, 2012


There’s a measure of anxiety among many “Ti Boutique” operators in Choiseul. Whether tis anxiety is founded or unfounded, I don’t know but they believe that their days are numbered and they blame it on VAT.

They claim that with the introduction of VAT, the cost price of “VAT-able” items may exceed the selling price; and because they are not VAT certified, they may not be able to recuperate their losses and that may spell disaster for their business.

So, in those circumstances, they ask: what do we do? Will we be forced to close down? Of course, although these are largely theoretical, their anxieties may be legitimate!


Choiseul is unique and known for its exquisite geographical layout – starting from the Forest Reserve, the 12.1 square mile piece of earth slopes moderately and rolls westward into the Caribbean Sea, spreading out gradually at an angle of roughly 30 degrees; but it’s not the “spread” or the “slope” of the landscape that makes it unique. It is the ridges and their gorgeous “anatomical configuration” which perhaps makes Choiseul a sight to behold.

If we have had the opportunity to look at Choiseul from any angle, we may perhaps realize that it can compete with the Grand Canyon, the Great Wall of China and even the hanging gardens of Babylon and herein its hidden tourism potential. A thought that Dunstan St. Omer and perhaps Derek Walcott may well agree with.

The 17 ridges which make up (what hard-core patriots refer to as) the “smallest continent in the world” spread out like a voluptuous “perspective” into the Caribbean Sea.  An aerial or hilltop view makes the sight not just even breath-taking but equally therapeutic, capturing the velvety green canopy of vegetation which makes the configuration look as nearly as beautiful and as sexy as lady Tulisa.

But despite all those heavenly characteristics, crunch time may now be approaching! What will be the fate of the Ti Boutique sector in (what a son of a patriotic son of the soil and lawyer Huggins Neal Nicholas once described as) “nature’s seventh heaven”?

With an unenviable Basic Needs index of 13.1, the district’s poverty ranking paints a sorry picture of our socio-economic conditions on the ground; and although we are a people living on a landscape approaching a heavenly bliss (as suggested by Nicholas), we nonetheless remain a quintessentially poor people searching for a better way of life; and the statistical projection is things are on course to become even worse for the Ti Boutique sector!

Ti Boutique: a major commercial feature

Because of the district’s geographic and demographic configuration, the proliferation of the Ti Boutiques across the ridges has become a permanent economic feature of Choiseul. These small shops offer a variety of essential grocery items and credit to their clients. They are partly tradition; but they are also absolutely necessary “commercial” units and are particularly indispensable in the remote hinterland communities (such as of Derriere Morne (Franciou), Ravineau, Bois d’Inde, Delcer, Industry, La Pointe, Mongouge, Morne Sion, Martin and Fiette).

Moreover, they have proven to be vital in times of extreme weather and when natural disaster strikes the western communities are cut out from “civilization” because of the overflowing Trou Marc, Sabre Wisha and Trou Barbay rivers; and the Victoria and Belle Vue landslides which render any passage out impossible.

It is under those circumstances that the Ti Boutique – just like the health centres, schools and cooking gas outlets - becomes absolutely indispensable in ensuring at least “temporary survival” of the natives.

In that context, the Ti Boutiques form an indispensable part of any disaster preparedness and vulnerability-reduction strategy for the district; and in the same way that the post-colonial authorities saw the relevance of “decentralized” essential services like health, education and energy to those vulnerable communities, our government should move in and do the same for the post-VAT survival of the Ti Boutique.

The case of the Ti Boutique operators

VAT is a tax on business transactions; it is not a tax on profits. VAT is charged at 15% on most supplies, though some are either zero-rated or exempt. VAT is levied at two stages: Input and Output.  Any VAT paid by businesses on their purchases is called 'input VAT'. The VAT charged by VAT-registered businesses is called 'output VAT'.

 If the Output Tax (on sales) is greater than the Input Tax (on purchases), then the difference must be paid to Inland Revenue Department or Customs. On the other hand, if Input Tax exceeds Output Tax, then Inland Revenue Department or Customs will make a refund of VAT to the business.

Therefore, while VAT-registered businesses are able to reclaim the VAT that has been charged by other businesses as ‘input tax’, the non-registered small shops can’t and that may have implications for the latter’s survival.

The big questions are: Will the statutory configuration of VAT displace and ultimately wipe out the Ti Boutiques in Choiseul? And if that were to become a reality, then what will be the social and economic implications? What will eventually become of that sector? Has government considered them as potentially vulnerable and what policies have been put in place for their sustainability or survival?

From the look of things, it appears – at least theoretically – that the Ti Boutique sector may have a case.