By Machela Osagboro
Troubling times are ahead for Antigua and Barbuda as the Minister of Finance, Gaston Browne revealed that consumption of goods and services in Antigua and Barbuda is expected to decline by 30 to 40 percent within the next few months as a result of the coronavirus crisis.
The grim reality of the effect of the coronavirus on travel and trade of goods that has left hotels on Island barren, is sinking in. The buoyant service industry has already ground to a halt thereby causing a devastating ripple effect on the earning potential for many sectors in the society.
“The government’s revenue comes mainly from two sources: the Inland Revenue Department and the Customs Department, with some small fees paid into Immigration and the airport, which reaches the government’s Treasury. However, we will be receiving a significantly lesser amount of monies from these revenue sources. So, as you can see, we are heading for a downward trend,” the Chief of staff in the Office of the Prime Minister, Lionel Hurst told Observer.
The Cabinet notes further revealed that the effect of the decline in consumption will likely result in a reduction of 60 to 70 percent in government revenues, however an exact percentage of the decline cannot be estimated at this time because people are still panic buying.
“Right now, the supermarkets are seeing an upward trend because people are buying to stock up their cupboards, but once they see that the supermarkets won’t close, the demand will go down and we will see a fall in that sector,” Hurst added.
The Prme Minister’s Chief of Staff said that Antigua and Barbuda’s economic situation will rapidly worsen, as most of the imports that come into the country for use by the hotels have stopped.
“They usually do a monthly preparation and what we have noticed is that for the month of April there are fewer orders going out from the hotels,” said Hurst.
Despite this grim truth, Hurst shared that the Gaston Browne administration will make every effort to reach an acceptable level of revenue that will allow the government to meet its salaries and wages expenses.
As an accompanying measure to mitigate against an economic fallout, in as far as the law allows, Hurst also stated that PM Browne has compelled all assets controlled by the central government and the statutory corporations to report profits and to transfer portions of said profits to the Treasury, when the crisis ends.
While those measures will be put in place, Browne painted a rather grim picture of the economic situation when he presented his assessment to Cabinet last Friday.
The Cabinet notes further revealed that Browne met with members of the Eastern Caribbean Central Bank on Friday and, “the ECCB will make $5 million available to all states, divided equally (more or less). Many of the ECCB’s recommendations have already been implemented by the Antigua and Barbuda Government”.
Browne has also made a formal appeal to the International Monetary Fund for economic assistance; however, to date no response or acknowledgement has been received.