Past IMF Head of Mission predicted decline in construction if Timothy Harris Government fails to attract new investment

BASSETERRE, ST. KITTS, JULY 25TH 2017 – The decline in the construction sector as reported by TDC in its 2016/2017 Report, was predicted by the former Head of the International Monetary Fund (IMF) Mission to St. Kitts and Nevis, Ms. Judith Gold.

During a visit to St. Kitts and Nevis in 2015, Ms. Gold told reporters that the St. Kitts and Nevis economy was soundly established and grounded, as a result of the unprecedented construction boom that will continue for the next two to three years as a result of several projects initiated by the past St. Kitts-Nevis Labour Party Administration of the Right Hon Dr Denzil Douglas.

She predicted however that she economic activity will decline after the Labour-initiated projects are completed and there are no new projects initiated by the new PLP/CCM/PAM administration of Prime Minister Dr. Timothy Harris.

“There have been a lot of investments to bring the economy to where it is now. It cannot continue to expand at this pace because it is expanding very quickly, but the base is now wider, so it would need more investment to have it continue expanding at this pace. Because of the base effect, we expect some slowdown in growth,” she told WINNFM’s André Huie.

Ms. Gold added that as the past Labour Government’s initiated projects end, they will no longer be generating the same level of investments.

TDC’s Annual Report for 2016/2017 sent to shareholders ahead of its AGM said the importation of building materials, a gauge of activity in the construction sector declined.

“The construction sector was negatively impacted by events in the Citizenship By Investment programme and the resulting down turn in demand for properties to serve it. Public Sector capital investment declined in 2016. Correspondingly, the profit for the Home and Buildings in Nevis and St. Kitts declined,” the TDC Directors said.

The TDC directors also disclosed that the St. Kitts Masonry Products Ltd registered “a significant decline in profit due to a reduction in the demand for blocks and ready mix concrete as the construction industry contracted during the year.”

The directors also reported that car rental for TDC Rentals Ltd and TDC Rentals (Nevis) Ltd “declined as a number of long-term car rental contracts with several construction related businesses in St. Kitts expired. In addition fierce competition from numerous small independent agencies utilizing used Japanese vehicles has cut into market share.”

When the PLP/CCM/PAM coalition of Prime Minister Harris took office in February 2015, construction work was being done on several Citizenship By Investment properties in the Federation including the St. Kitts Castle in Frigate Bay, the Pelican Bay Development (Hilton Embassy Suites), Koi Residences in Half Moon Bay, Imperial Bay Golf and Beach Residences at Half Moon Bay/Conaree; Golden Rock Commercial Park, Koi Headquarters, Silver Reef Development at Frigate Bay; Kittitian Hill Resort and Golf Course; renovation of Golden Lemon; Park Hyatt St. Kitts; Galaxy (Ramada Inn); T-Loft at Pirate’s Nest in Frigate Bay, Rendevouz at Half Moon, Christophe Harbour Marina and the road leading from Frigate Bay to the South East Peninsula. Also under construction were the headquarters of the Solid Waste Management Agency, the Victoria Road Day Care and Pre School, the Frigate Bay Road Solar Farm, the AVEC expansion, housing projects at Buckleys, Pine Gardens, Challegers and Ottley’s, and the Mental Health Day Care Facility.

Several of the projects have been completed, at a standstill or moving slowly. the new Delta Petroleum Building was also in the pipeline.

Last week the Eastern Caribbean Central Bank (ECCB) revised downward its projected GDP for St. Kitts and Nevis for 2017 from 2.84 percent to 2.36 percent.

In January this year, the ECCB had downgraded its GDP for St. Kitts and Nevis from 3.02 percent to 2.84 percent.