A lot of factors contribute to a country’s financial well being. The most significant factor is of course a country’s ability to raise money through taxes, which are used to pay for the services we are accustomed to; such as infrastructure, education, social services, and more. Factors that detract from a country’s financial well being include natural disasters, major changes in the global economy and a country’s ability to raise money through taxes. Grenada’s population enjoys a relatively low taxation rate, in comparison with some more wealthy and developed nations such as Canada for example, where the population pays Provincial Sales Tax, National Goods and Services Tax, Income Tax, Property Tax and more. The favourable tax environment that Grenada enjoys has been a deliberate effort to keep the economic activity going, by keeping as much money in the hands of consumers as possible, while also attracting investment. When Grenada’s economy was devastated by Hurricane’s Ivan and Emily, the Nations suffered a tremendous blow to its revenue generating capacity, as well as having to suffer through the consequences of rebuilding the nation from the bottom up. Ivan, for example was a tremendous blow in terms of financial losses: 85% of the nutmeg stock was destroyed and 70% of the hotel room stock was destroyed. Combined, the loss of economic activity in these two sectors alone was catastrophic on the country’s ability to raise money to run itself. The NNP Administration did not panic in the face of this financial catastrophe – the NNP got on with the business entrusted to them by the people. The country survived and government salaries were paid. Grenada benefitted from the generosity of donors thanks to the solid reputation of good governance which assisted the Government in rebuilding housing stock, schools, and re-establishing the economy. Since then, Grenada has been profiled on the world stage as an example of best practice in disaster recovery. Challenges like the hurricanes, only provides a partial explanation for the state of Grenada’s economy however. The other side of the problem stemmed from structural issues that go back as far as the colonial era, where our economy was narrowly focused on raw exports, making Grenada’s economy very vulnerable. Moving Grenada towards a footing of economic diversification and independence and prosperity has and will continue to be a challenge - but it is not an insurmountable one. The New National Party recognized the challenges and the opportunities. The first priority was, and should continue to be, the creation of jobs. Following the disasters, the construction industry provided employment to thousands of people, followed by the resurgence of our tourism industry which employed thousands more. Many of the investments which were condemned by the NDC and their activists while they were opposition, were conservatively estimated to provide an additional 6000 jobs. Early indications, such as the employee lay-off at Port Louis do not suggest that the New Administration has succeeded in keeping fuel in the engine of growth for our economy. Investors need confidence, and having the new Government declaring a financial crisis in the first two months in office doesn’t support investor confidence. When the NDC assumed Office in July, the International Monetary Fund clearly stated that Grenada’s new Government had inherited a healthy economy, which is the backbone of the Nation’s financial well being. The IMF then disbursed $4.7 million USD, which appears to have been spent on new furniture for the Prime Minister’s Residence, among other things that are not in line with the Nations priorities. The hard fact is that Grenada has been operating with debt has never been a secret to the Nation. Debt is an unavoidable circumstance for a developing country, and the best way to deal with that is to ensure what is borrowed is an investment in the future. The NNP Government had an even longer term vision that took the Nation beyond a world class tourist destination. The ultimate goal for the NNP was the creation of a information based economy, where the physical size of the country would no longer be a limiting factor. Through information technology, for example, Grenada has the potential to develop an economy without borders that could grow as large and generate as much wealth as the imaginations and innovations of Grenadians and investors would allow. To this end, the investment the previous Government had been making in building the Nation’s financial independence was working. While most economies in the world were suffering, Grenada’s economy was growing so well the growth rate in percent was even higher than some biggest economies of the world. Additionally, the longer term vision meant that the monies spent today were monies invested in tomorrow – much like a person taking out a mortgage to purchase or build a house. The hard part about making this kind of long term investment is that the nature of the political beast discourages this kind of thinking, because there is a tendency for new Administrations to throw the baby out with the bathwater when they assume office, which often leads to a zig-zag in the development path that ultimately slows down the progress towards the ultimate goal – prosperity, freedom, independence and ultimately the sustainability of all of these. This context must be taken into consideration when evaluating the facts about the Nation’s finances. Grenada is a developing country, and as facts will show, most developing countries have financial circumstances similar to Grenada in terms of debt – but few of them can boast Grenada’s growth rate, life expectancy, quality of life, access to health care, and more that the Government has been able to provide for the people - as if it were a wealthier nation. Some developing countries, are carrying the burden of massive debts because of lavish spending by their leaders. Some leaders have built gold palaces for themselves, and squandered untold billions on weapons and things that did not benefit the people. Other countries fell victim to poorly conceived aid projects, or development schemes that didn’t work. In Grenada’s case, there is little question that there is much to be proud of, both in terms of the Nation’s finances and the nations standard of living. The New National Party knows that there is nothing to apologise for. The Nation has survived a number of events that had contributed to Grenada’s debt now, but one thing the people can be assured of is that the debt that the Nation carries now was spent on the people. There are no palaces, weapon stockpiles, private planes, lavish parties, private yachts, expensive travel, or lavish gifts to be uncovered by the new Administration while they waste Government’s time and money turning over every stone in the hopes of finding such. Unlike the Government of Today, the New National Party believed in the potential of the Grenadian people, and the New National Party knew that if we invested in the people’s future by creating the conditions necessary to allow everyone with the dream and desire to reach their potential they could, that our dreams would come true. Perhaps the deepest underlying fear of the National Democratic Congress, many of whom once believed they had to ‘dictate’ development to the masses, don’t really believe that Grenadians can achieve and reach high enough to make the risk of investing in you worth it. (The views expressed in the article are those of the writer and not necessarily those of Inside Grenada News) Reprinted from NNP news