As the Territory awaits the official reading of the 2018 budget estimates Premier and Minister for Finance Dr. the Hon. D. Orlando Smith has hinted that the Territory’s economy and finances are not as robust as it used to be because of the September 2017 catastrophic hurricanes.
Constitutionally the Budget is to be passed by the House of Assembly by April. This means that Standing Finance Committee deliberations will need to be concluded by March.
Although an official date has not been provided for the Budget Address, weighing constitutional requirements, and the fact that Premier Smith announced on 13 November that work on the budget commenced, it would be reasonable to expect the address in coming weeks.
However, the delay seems understandable as the Minister explained that Government is currently faced with various needs and issues. Speaking frankly on the economy during the 25 January Public Consultation meeting that was held in Virgin Gorda the BVI Leader admitted that the GDP is not what it used to be.
The Premier told the gathering: “This event (hurricanes Irma and Maria) affected the entire Territory and affected the economy so that government has lost about 40 percent of the GDP (gross domestic product).”
The Economic Pillars
Key contributors to the Territory’s GDP are the two pillars of the BVI economy – financial services, and tourism. However, the Premier reminded that both sectors were wounded by a horrible flood and two killer hurricanes.
Dr. Smith, however, lauded the financial services sector which Hon. Smith said valiantly stood, and is quickly regrouping: “We were able to maintain our activities in the financial services space because of the resiliency that was built into that system. Initially some of the persons who were in that area left and went to other areas whether it was the Cayman Islands or St Lucia they were able to continue their work from those areas because of the way that their system operates,” Hon. Smith explained.
Things are returning to normal for financial services as the Premier indicated that businesses that left the BVI are returning: “Most of them are coming back to continue to work here and the last I heard there are about 70 percent were back which means as those people come back they’ll be re-establishing their base, re-establishing their office and then re-establishing employment of persons who use to work with them.”
Nevertheless, on the side of tourism the Premier admitted that it is going to take a little while before the major hotels get back on their feet. The BVI Leader noted that there are many hotels and villa and other types of accommodation for visitors which are beginning to operate. The Premier indicated that these facilities will need assistance.
In looking at the economic picture, unemployment is never a welcome sight, particularly in the BVI’ case where many persons are looking for work. Responding to this concern the Minister for Finance explained that Government is trying to counter the unemployment issues by assisting businesses to get back on track: “What we have done is we have actually given some grants to small businesses in order to help them to get back or at least start restocking and to get back on their feet. Once businesses become operational as we continue to encourage them they will be able to employ more persons in the BVI.”
Premier Smith also mentioned that Government through the Ministry of Education is offering training in the construction field to ensure that persons who are unemployed will have the skills necessary for this now thriving industry.