LOW productivity and high unemployment in the country have been credited, in part, to the present weakness of the economy.
The reasons for this are outlined in the 2017/2018 budget statement presented by Prime Minister Allen Chastanet recently when he said that 20 percent of the country’s productive labour force is unemployed with youth unemployment at a 43.1 percent high.
The Prime Minister said that last year the unemployment rate reduced from 24.1 percent to 21.6 percent, still leaving 22, 500 people unemployed in the country while productivity had been falling by an average of 0.6 percent from 2007 to 2016.
“The low levels of work productivity can be directly linked to an acute skills mismatch in St. Lucia. Our workforce is predominantly low-skilled, as has been revealed by many reports. However, the economy requires an ample supply of skilled and semi-skilled labour which we are failing to produce,” Chastanet said.
The country’s debt position, he added, continues to worsen, with the debt burden creeping up from one year to the next.
“The increase in the debt stock, coupled with low growth and its implications for servicing the debt, has severely restricted our degrees of freedom in implementing expansionary fiscal policy to cushion the adverse impact of low growth,” Chastanet said.
He added that the structure of the country’s debt, with a large percentage of it in the form of short-term instruments, has significantly increased the roll-over risk.
Chastanet said the cost of doing business in St. Lucia is in most cases higher than that of its competitors and pointed to the cost of electricity to show one disparity.
“We have an aging infrastructure and public assets have deteriorated significantly due to the lack of timely, adequate and at times no maintenance. Our roads, schools, hospitals, water distribution network, government buildings, including police stations, require urgent attention,” Chastanet said.
In exposing the social and economic reality in St. Lucia, he said the country is drowning in a pool of blatant negativity and decadent behaviour.
“Let us not be shocked by such an assessment. It surrounds us in all its guises and forms. Crime, violence, abuse, lack of respect for people and property — these have become the norm and part of our daily existence. We must encourage discourse, not destruction. We have to set better standards for ourselves and for our children and take pride in our country,” Chastanet said.
He said St. Lucians can either choose to act decisively to effect real change in the country or continue to plod an old familiar path to nowhere: “We are at a critical juncture in our development journey.”
Chastanet spoke of a new vision for St. Lucia, saying that the times demand such a vision which will require fundamental and structural changes in the economy.
“We want to build a St. Lucia that instils pride — a place where businesses can flourish, where people can get jobs (and) not handouts, where people feel secure, care for each other, can access educational opportunities, receive quality health services and enjoy a comfortable standard of living without imposing a burden on future generations,” Chastanet said.