GLO Fellow Colin Cannonier, Associate Professor at Belmont University and GLO Country Lead for St. Kitts and Nevis (a dual-island nation between the Atlantic Ocean and Caribbean Sea), where he is a frequent advisor to the government. On the occasion of the currently global challenges, he interviewed Dr. The Honourable Timothy Harris, Prime Minister of St. Kitts and Nevis, about the country’s success story in the pandemic.
Some core messages of the interview:
- Due to sound fiscal prudence in the past, St. Kitts and Nevis was able to act quickly and decisively in stimulating the economy.
- As an educated society with a 97% literacy rate St. Kitts and Nevis adapted well to the ‘new norm’ with respect to social and physical distancing, hand sanitizing and wearing masks in a joint effort to reduce the spread of the virus.
- As a result of the suspension of international and regional air and cruise travel, and precautionary border closures locally to contain and prevent the spread of the virus, economic activity within the local Tourism Sector contracted by some 35 percent in 2020.
- Agriculture, the (medical) Cannabis industry and I.T. will all play pivotal roles in the economic revival of St. Kitts and Nevis.
- The hotel, airline and cruise industries all play an important part in the economic revival of St. Kitts and Nevis.
- There is light at the end of the tunnel!
Dr. The Honourable Timothy Harris, Prime Minister of St. Kitts and Nevis, left, and Colin Cannonier, PhD, Associate Professor of Economics, GLO Fellow and GLO Country Lead of St. Kitts and Nevis.
Interview
GLO: How has the St. Kitts & Nevis economy outperformed most of the region in dealing with the coronavirus pandemic?
PM Timothy Harris: There are a number of reasons for this. Firstly, the Government of St. Kitts and Nevis due to sound fiscal prudence, was able to act quickly and decisively in stimulating the economy thereby bringing much needed relief to people who lost their jobs or were offered fewer working hours as a result of COVID-19. Our Stimulus Package in total was, approximately, US $44.4 million. This is significant as no other country in the region matched this. The stimulus package included increased benefits in social safety nets to buttress the effects of the pandemic. For example, our Poverty Alleviation Programme (PAP) was further funded and benefits were extended more citizens.
Additionally, Construction has long been a key driver of growth and development in our economy. The Construction Sector continues to provide employment for many of our citizens and residents and it is the primary source of income for many families. My government will continue to make the necessary investments to further enhance resilience and transform the economy as has been necessitated by the impacts of the COVID-19 pandemic. In 2019, activity in the Construction Sector grew by 1.8 percent. This growth was primarily due to an increase in the contribution of locally financed construction activity emanating from the Public and Private Sectors. The Government sponsored projects – a major one being the rehabilitation of the Island Main Road – have made significant contributions to achieving this positive growth outturn.
GLO: To date, the island Federation has recorded zero COVID-19 related deaths. What do you attribute this to?
PM Timothy Harris: There are a number of reasons I can attribute this to. The government introduced the mandatory wearing of masks, lock-downs, curfews and closed our borders very early. Additionally, early activation of our National Emergency Operations Center (NEOC) coupled with a proper functioning expert compliance team energetically working around the clock ensured that measures were quickly implemented to avoid widespread infections in St. Kitts and Nevis.
Our Chief Medical Officer (CMO), Medical Chief of Staff (MCS) and other Ministry of Health Officials were decisive in implementing social and physical distancing, hand sanitizing and mask wearing to protect our population. Additionally, the Attorney General’s Chambers worked indefatigably to ensure that timely, appropriate and legal procedures were in place throughout the entire process, especially with respect to curfew implementation. The National Emergency Management Agency (NEMA) ensured that information was disseminated to our citizens and residents in an accurate and timely manner. All agencies including law enforcement functioned cohesively in order to respond effectively to this Pandemic.
Finally, the fortitude of our people cannot go unmentioned. We are an educated society with a 97% literacy rate. Kittitians and Nevisians although inconvenienced, understood the health risks of COVID-19. By far they adapted to the ‘new norm’ with respect to social and physical distancing, hand sanitizing and wearing masks all in an effort to reduce the spread. This is perhaps the biggest reason why we have recorded zero COVID-19 related deaths in our Federation.
GLO: What are some of the more significant challenges the Federation is expected to be confronted with during recovery?
PM Timothy Harris: For several years, Tourism has been the mainstay of our economy. For two years in a row we welcomed over one million cruise passengers to our shores. Notwithstanding the obvious need to further diversify our economy, particularly in light of the impact of the COVID-19 pandemic. We cannot overlook the contributions of the Tourism Sector. Prior to the COVID-19 pandemic, development in the Tourism Sector was on an upward trajectory. The Koi Resort Curio Collection by Hilton St. Kitts made its debut in February 2020, increasing our room stock by 102 rooms, adding to the appeal to travellers who have continued to make the Federation their destination of choice.
The commissioning of the second cruise pier at Port Zante enabled the Federation to welcome four (4) cruise ships simultaneously on December 16th, 2019. with the Celebrity Summit and the Seaborne Odyssey docking at the newly constructed pier while the Britannia and the Anthem of the Seas were moored at the original berthing facility indicating prospects for continued growth in the Cruise Sector.
The pandemic has, without a doubt, negatively impacted global tourism on an unprecedented scale. The border closures, stay-at-home requirements and No Sail orders for cruise ships that were imposed around the world in response to the COVID-19 pandemic have had a deleterious effect on our Tourism Sector. As a result of the suspension of international and regional air and cruise travel, and precautionary border closures locally to contain and prevent the spread of the virus, it is estimated that economic activity within the local Tourism Sector will contract by 35.4 percent in 2020 when compared to a positive growth of 7.9 percent in 2019. The negative impact on our citizens and residents who have ties to the sector was significant as the closure of hotels and tourism support services resulted in approximately 5,000 people, roughly 20 percent of the labor force, being laid off or severed while others experienced underemployment due to reduced hours.
Notwithstanding the challenges, there is hope for recovery. My Government recognises that recovery in the Tourism Sector will not happen suddenly. We recognise that COVID-19 has dramatically changed the global sphere in which we are competing. It is therefore necessary that we transform our product. Our approaches at this time must be altered in order to realise our revision for our recovery in this Sector as well as related sectors and the economy as a whole. As a result, my Government along with a wide cross section of stakeholders in the Tourism Sector will continue to carefully plan how we will restructure and re-engineer our tourism product so that we produce the best result for our people. Our proactive and aggressive “All-of-Society Approach” to managing the first wave of the COVID-19 pandemic, the Federation received international recognition from key news outlets such as the British Broadcasting Corporation (BBC), Sky News and Tripoto, which named St. Kitts and Nevis among the few countries in the world to have effectively “beat” the virus. Further, according to the United States Centres for Disease Control and Prevention (CDC), St. Kitts and Nevis has been categorized as Low Risk for travel purposes. This bodes well for us as we open our borders and welcome tourists who are looking for a place to vacation with minimal risk of contracting the virus. If we are to maintain this rating, it is imperative that we all continue to monitor adherence to the COVID-19 protocols. It is our hope that, with the reopened borders, persons who depend on our Tourism Industry for their main source of income will be able to return to work and have some semblance of normalcy in their lives.
GLO: Are there any emerging sectors likely to play a pivotal role in the economic revival of the Federation?
PM Timothy Harris: Definitely, the ability to feed one’s self is important to any country, especially a small Island developing state like St. Kitts and Nevis. Also, other interesting areas are Medicinal Marijuana and of course Information Technology (I.T.) which transcends all sectors. Therefore Agriculture, the Cannabis industry and I.T. will all play pivotal roles in the economic revival of St. Kitts and Nevis.
Food safety and security is important to every country. Agriculture has the potential to generate real wealth and provide decent jobs for our people. My Government therefore has identified this Sector as a major pillar of our strategy for recovery and transformation. We believe that our investment in this Sector is well placed and we hope to obtain bountiful returns, including enhancing food and nutrition security within our borders. Moreover, through our investment in Agriculture, we anticipate success in meeting the targets advanced by the United Nations for Sustainable Development Goals (SDGs) 2, 3 and 12 – Zero Hunger, Good Health and Well Being, Responsible Consumption, Production and export respectively.
Information and Communications Technology will continue to be a key pillar in the recovery and transformation process. Not surprisingly, our vision for transitioning to a digital economy remains a high priority for my Team Unity Administration. The Federation intends to become a world leader in the delivery of digital services to our citizens, residents and investors. We are therefore utilizing our comprehensive Digital Government Strategy to guide the rollout of the digital transformation process in the Public Sector.
A new and emerging area of focus for the Government is the Medicinal Cannabis Industry. Earlier last year, the pertinent legislation, the Cannabis Act No. 8 of 2020, was passed in this Honourable House. We therefore intend to take additional steps to advance the development of this industry. One important step planned for 2021 is the appointment of suitably qualified persons to serve the Medicinal Cannabis Authority. The primary function of this new body would be to regulate, monitor and control the cultivation, supply, possession, production and use of medicinal cannabis and for related matters. It also provides for the lawful access to medicinal cannabis as an alternative treatment for persons who are suffering from a qualifying medical condition and for a comprehensive licensing scheme. We are convinced that our people, particularly our small entrepreneurs and farmers could benefit from the development of the local industry here in the Federation. Several indirect benefits such as increasing employment opportunities, reduced crime and incarceration, reduced costs for law enforcement and medical treatment are also anticipated.
GLO: What role can the international community play in the recovery of the twin-island state?
PM Timothy Harris: The international Community through United Nation (UN) Agencies such as Pan American Health Organization/World Health Organization (PAHO/WHO), the hotel, airline and cruise industries all play an important part in the economic revival of St. Kitts and Nevis. It is through relations with PAHO/WHO and our EU partners that we would be able to procure COVID-19 vaccines to curb or halt the spread of the pandemic.
Additionally, if we are to rebuild our tourism product it is important for us to maintain strong relations with the hotel, airline, cruise and yachting industries for obvious reasons. As you know relations in this Industry are symbiotic.
Sometimes when countries experience sudden economic downturns, as many countries have as a result of the COVID-19, it is important that countries implement recovery measures quickly and decisively in order to prevent a bigger economic crisis further down the road. What I’m saying is frankly the Federation must be prepared to make tough decisions now, and implement measures to avert bigger problems in the future. Therefore, maintaining strong relations with regional and international lending institutions like the Caribbean Development Bank (CDB), World Bank and the International Monetary Fund (IMF) are critical to securing fiscal space in rebuilding an economy. What is comforting is that our country has done an incredible job in reducing our public debt to 60% of Gross Domestic Product (GDP) over the past few years. Additionally, we have completely paid off our IMF debt.
GLO: What is your message to the people of St. Kitts and Nevis?
PM Timothy Harris: My message to the people of St. Kitts and Nevis is simple but hopeful. My Government will continue to do all in its power to grow this economy and put it back on a positive trajectory. Back to where we were prior to COVID-19. In the interim, we will continue to strengthen social safety nets to give our citizens support during these hard times.
Finally I would thank Kittitians and Nevisians for their tenacity, fortitude and understanding during this pandemic. Their collective resolve has been incredible. I would urge them to continue being each other’s keeper and to have faith, as there is a light at the end of the tunnel!
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With Dr. The Honourable Timothy Harris, Prime Minister of St. Kitts and Nevis, spoke Colin Cannonier, PhD, Associate Professor of Economics, GLO Fellow and GLO Country Lead of St. Kitts and Nevis.
Ends;
