By Mellica McPherson-Ganda
Echoing Territorial fears that the financial services sector might be affected and generations to come will be saddled with a heavy bill, Leader of the Opposition Hon. Andrew Fahie publicly expressed apprehension at the thought that the BVI Government is considering the World Bank and International Monetary Fund (IMF) as financial options for the rebuilding efforts.
The sourcing of funds for the recovery process is critical at this juncture as earlier in the month Premier and Minister for Finance Dr. the Hon. D. Orlando Smith disclosed that “based on preliminary assessments, the estimated damages to the Territory is in the area of $3.3 billion across all sectors.” Further it was mentioned that central government funds from the Disaster, Reserve and Relief funds will only help with immediate relief, road clearings and government operations.
The Premier explained that Grants from international partners will help with the reconstruction of schools, agriculture and fisheries industry, and health services. In fact, the BVI Leader pointed out that Government will be seeking financing on concessionary terms to develop its primary infrastructural needs further and providing housing for residents. Hon. Smith also discussed meetings with the World Bank.
While noting the importance of funding, Leader of the Opposition Hon. Fahie announced on Tuesday 24 October that he cannot shake his apprehension about Government’s plans to approach the World Bank.
Hon. Fahie said that he has both questions and concerns about the funding proposal. In fact he lamented that there has not been appropriate communication between government and the members of the House of Assembly and noted that he, like every other resident, only heard that the World Bank and IMF are financial options.
“I am hearing and again I had to hear this that we are going to the World Bank…I am concerned when these things happen. As a Member of the legislature you have to hear these discussions. I know what is coming after: I have seen it a million and one times. Normally you just see when the loan reaches the House [of Assembly]and that’s it you have to discuss it. No one can tell me don’t say that because that has been the trend for the last few years.”
Hon. Fahie announced via a radio broadcast that details about the recovery amount needed are sketchy. “One of the concerns that I have along these lines is that I am hearing figures being thrown out $3.3 billion dollars, I am not seeing a list to know how did we come up with the $3.3 billion dollars. I have not seen the list also to know what is on there that we’re going to be doing differently if we are going this road, which I am concerned about…”
“We don’t know what is in there and this is what I am talking about communication with. Before we go to the banks,” Hon. Fahie said as he pointed out that institutions such as the World Bank and IMF have certain track records and noted that he is uncomfortable with what might be required of the Territory as part of the agreement.
“We have to be careful when we go to IMF and them. When you research them – the IMF …We have to be careful because they will finally get their hands on our financial services too,” Hon. Fahie declared.
The Opposition Leader said he expects his views on the matter to be labeled as negativity. “Whenever you touch these subjects people say you’re being negative, but you got to remember whenever you go for this kind of loans … it is about five to six generations you’re tying up. I am not going to sit as a leader even though I know that we have to look for funding and let us go for these things blindly… I have obligations to generations unborn for us to have intelligent discussions.”
World Bank/IMF in Play
On 13 and 14 of October Premier Smith and Minister for Health and Social Development, Hon Ronnie W. Skelton attended several meetings that were part of the World Bank’s annual meeting on an invitation facilitated by the United Kingdom’s government.
Hon. Smith said that he had the opportunity to participate in a high-level roundtable discussion that looked at the financial implications of the recent hurricanes in the region as well as discussions with regional and international funding agencies such as the Caribbean Development Bank, the European Union, and the UK’s Department for International Development.
The Minister of Finance explained that he stressed that the BVI is eligible to receive funding and used the opportunity to highlight the Territory’s position and made a case for the Virgin Islands to have greater access to financial support to fund reconstruction.
“Throughout those meetings and discussions, I continued to make the case that despite our middle to high annual GDP, the Virgin Islands needs greater access to funds to help us successfully recover from this disaster. As I stated before, my administration sees a responsible mix of grants, and affordable borrowing as the best way forward to fund our reconstruction.”
The Premier said that his meetings in Washington, DC were positive and secured confirmations from partners such as the CDB and the EU to support finding responsible ways to fund BVI recovery.
Lender Have Accountability Concern
During his Town Hall meeting on 23 October the Premier further recapped his World Bank meeting and noted that government is keen to allay investor fears about accountability.
“The important point I want to make about the recovery plan is that we go out speaking to the United Kingdom (UK), speaking to the World Bank and other donors, they would want to know that we have a good plan going forward as to what we want to see the country look like and the things we want to do with the money that is being raised to make sure that it is used effectively to really build and restrict the BVI.”
“Accountability is a watch word for the Ministry of Finance and we will ensure that it continues to be in place so that donors, international donors and also individuals will feel satisfied that when they are contributing to the recovery of the BVI that they are contributing something that is meaningful. Something that is well planned and something that would be to the benefit of all,” he added.
It was announced that immediately following the passage of Hurricane Irma, Government began discussions with key long-standing and new partners locally and internationally to assist us with the massive response that is necessary following such a catastrophe.
The Premier broadly described the proposed investors as “partners [who]have been high profile private residents and businesses, regional and international NGOs and response agencies, as well as service groups such as our Rotary Clubs.”
As part of the quest for assistance the Premier met with the United Nations Economic Commission for Latin America and the Caribbean who will be assisting the Territory by providing a large team of technical persons to help undertake a detailed damage and loss assessment across all sectors. This will be undertaken in the coming weeks.