St. Lucia Government unveils multi-million dollar economic recovery plan
The St. Lucia government has unveiled an EC$579.3 million (One EC dollar=US$0.37 cents) Economic Recovery and Resilience Plan as the island deals with the impact of the coronavirus (COCVID-19) that affected 22 people and brought about a shutdown of the local economy.
Prime Minister Allen Chastanet, who is also the Finance Minister, in a radio and television broadcast on Sunday night, said that the plan contains six key pillars, namely stimulating the economy; fast tracking of shovel ready capital investment projects; strengthening social protection systems; resilience building of productive sectors; building resilience in the health sector and climate change and disaster risk mitigation.
Chastanet said that the strategy to stimulating the economy includes eight priority interventions such as incentivising the commercial and banking sector to lend to micro, small and medium size (SME) entities. He said commercial banks would receive a 50 per cent waiver of corporate- income taxes related to earnings from SME lending, adding “this initiative will be in effect for three years and is geared towards improving small business solvency and the reduction of unemployment”
He said that the St. Lucia Development Bank will provide a combination of loan and grant support to MSEs with a focus on food security and adoption of digital technologies.
“The objective here is to assist agro processors and businesses in the digital technology community. The government of St. Lucia has committed EC$3.1 million to revitalize their businesses,” Chastanet said, noting that a 50 per cent waiver of commercial property tax for landlords who extend moratorium or rent reductions to their tenants.
He said over EC$5.1 million dollars in tangible benefits will go towards the poor and vulnerable citizens who have been financially affected by COVID-19; as well as, hotel & tourism employees who are currently unemployed.
“The government of St. Lucia will utilize part of the fuel surcharge of 50 cents currently levied on the use of diesel fuel to finance part or full payment of electricity bills for affected persons. LUCELEC (St. Lucia Electricity Services) and the Department of Finance will work jointly, to ensure this novel initiative redounds to economic relief to over 11,000 households.”
Chanstanet said that there will also be a waiver of duties on personal hygiene products, increases to the subsidy on flour purchased by bakers from EC$12 to EC$17.
In addition, the government will provide five million dollars to otherwise solvent businesses with low cost financing between two and three per cent interest, to assist in meeting their working capital objectives. “Entities can receive a maximum of EC$250,000 through the St.Lucia Development Bank which is the implementing agency. The process of application will be simple and hassle free, to ensure small and medium size enterprises can take full advantage,” Chastanet added.
He said that front line workers such as police, nurses, fire officers and doctors will benefit from duty-free vehicles with special support from financial institutions.
“So far our country’s swift response has proven successful as we continue to navigate through this pandemic. Our Economic Recovery plan is part of that strategy but it can only work if we are all in, work together and truly be each other’s keeper.
“We have laid the groundwork for success and COVID will only cause us to push harder, be more ambitious and determined. We are a caring society, a loving society and a blessed society,” Chastanet added.