GRENADA: Government struggling to fund capital projects in next budget

Prime Minister

Tillman Thomas.

*Photo credit: connect.in.com

 

 

 

ST GEORGE’S, Grenada, CMC–The Grenada government says it is struggling to find the money to fund capital projects and as a result it has been forced to postpone the presentation of the budget next month.

Deputy Permanent Secretary in the Ministry of Finance, Mike Sylvester, said the Tillman Thomas government was forced to push back the presentation from December to January since it could only fund less than half of what the ministries had presented for funding.

Sylvester, speaking during the national budget consultation on Thursday, said the ministries have submitted a request for EC$300 million (US$111 million) to fund projects but the government has only been able to provide a capital expenditure of EC$128.5 million (US$47.5 million).

“The 128.5 million dollars is around seven per cent of gross domestic product which I believe is the level we have been prior to the Hurricanes. It is also the level that we believe that government can sustainably finance to the extent that you will not have large unpaid claims  or unable to find resources to deal with the projects and programmes  that may come up” Sylvester said while noting that Grenada’s capital expenditure has been declining over the years.

“So we can sustainably finance that figure. We have to find a way to ensure that the best mixed of projects do get into that 125 million dollars. All projects new or ongoing will be evaluated on a pre established criteria before they are included on 2010 budget.”

The national budget consultation involving a number of stakeholders including the Chamber of Commerce and the Trade Union Congress (TUC) was held across the island over the past two months.

Government officials have said that public feedback is necessary in an effort to decide on a mixed package of projects to be implemented in the face of dwindling revenues.

They said that EC$56 million (US$20.7 million) is still needed to close the financing gap.

Sylvester said 2009 has been a difficult year for the government which is anticipating a slight recovery in direct revenues next year from EC$409.2 million (US$151.5 million) to EC$423.4 (US$156.6 million).