Dominica economy and debt burden both grew in 2011
ROSEAU, Dominica, Thursday July 19, 2012 – While the Dominica economy appears to be on a moderate recovery path, government is still facing challenges in reigning in the country’s debt burden.
This was revealed by Prime Minister Roosevelt Skerrit in Parliament as he delivered the national budget on Tuesday (July 17).
According to Prime Minister Skerrit, the economy is estimated to have grown by 1.9 per cent in 2011, and projected to grow by 2.0 percent in 2012, but to drop back to 1.8 percent in 2013.
He reported to parliament that the improvement in performance was due mainly to growth in the agriculture, construction and tourism sectors.
“The agricultural sector has accounted for 11.7 percent of total GDP with an overall increase in the sector of 5.1 percent” he said while comparing that increase with a 7.7 percent decline in 2010.
He has indicated that the sector is expected to expand further with a projected growth rate of 4.3 percent in 2012.
The House was told that the banana sector is expected to grow by 1.7 percent and other crops by 5.0 percent.
Additionally, the prime minister reported a significant increase in the tourism sector.
He said the hotels and restaurants sector is estimated to have grown by 6.1 percent in 2011.
However the total number of visitor arrivals up to December 2011 is estimated to have decreased by 1.2 percent.
There was also a decrease in the number of cruise calls and passengers “as a direct result of the global crisis”.
Despite this, the tourism sector is expected to grow by 1.9 percent in 2012.
However, Skerrit also revealed that Dominica’s total disbursed outstanding debt at the end of the financial year 2011/12 amounted to EC$896.3 million.
Skerrit said that that figure was 3.4 per cent more than the previous year, when the debt stood at EC$866.2 million.
The 2011/2012 figure’s said to consist of external debt “of which EC$541.9 million is held by central government and $109.6 million is debt guaranteed for public corporations”.
According to the prime minister, domestic debt for the same period was EC$202.2 million for central government, and debt guaranteed for public corporations was $42.6 million.
He said the increase in total disbursed outstanding debt is as a result of disbursements “on new and existing commitments”.
The government said during the financial year it contracted five external loans amounting to EC$75.9 million from the Caribbean Development Bank (CDB), the International Monetary Fund (IMF), and Agence Française de Dévelopement (AFD).
“The loans from CDB and IMF were contracted to repair damages caused by the Layou floods and Tropical Storm Ophelia, while the loan from AFD was contracted for the completion of the Roseau to Melville Hall Road project,” Skerrit told the House.
He also indicated that in December 2011 “a loan of EC$20 million was obtained to provide bridging finance, particularly for project implementation”.
Parliament’s been told that a three year medium term debt management strategy for the period 2010/11 to 2013/14 was developed to guide the management of Government’s debt.