PRIME MINISTER HON. TILLMQN THOMAS’ ADDRESS ON THE OPENING OF THE 2009 NATIONAL BUDGET RETREAT ST.GEORGE’S, GRENADA, TUESDAY SEPTEMBER 1st, 2009_ Ladies and Gentlemen it is my pleasure to welcome you to this Budget retreat with the primary objective of reviewing our performance in 2009 and to discuss our strategic priorities in preparation for the 2010 budget. I view this exercise as extremely important and critical. As the primary persons responsible for shaping our plans and budget, I want to reemphasize the importance of a strategic budgeting framework. Budgeting is an effective tool to responsibly allocate resources in the most effective way possible. Effective budgeting is always a challenging exercise particularly for governments given the multiplicity of competing demands and the limited resources. My ministers and permanent secretaries know this too well. Given this scenario, and the need to rationally prioritize and allocate resources, appreciating the need for and using a modeled budgeting framework is helpful. We are undertaking this exercise at a difficult period in the world’s economic history. For us in the OECS, it is particularly challenging. Prior to the deep recession, the region exhibited considerable vulnerabilities. Limited economic options, loss of trade preferences, globalization, climate change and the lack of competitiveness are just a few. All these vulnerabilities were exacerbated by a series of crises. The result is that almost every country in the Caribbean is negatively impacted. In Antigua for example where tourism is the major sector of the economy, revenues are down by 25%. In the Bahamas, approximately 19,000 persons have lost their jobs, equivalent to 10% of the workforce. Jamaica has also experienced considerable decline in their tourism, manufacturing and mining sectors with a disastrous impact on government revenues. Even Trinidad, which has the largest foreign exchange reserve in the region, is experiencing declining growth. ECLAC has recently projected that the volume of trade in Latin America and the Caribbean will decline by 13% by the end of the year. This is more than the 10% originally projected. Exports will decline by 14%, the largest drop in 72 years. Imports will drop by 14%, the worst in 27 years. All this has led to the conclusion by some that the region is moving from a recession to a depression. With lower remittances, declining exports, reduced foreign investments and fewer tourists, our revenues are significantly reduced. At the same time, we are expected to deliver the same level of services as expectations are high. How do we respond? While we have to manage expectations, we also have to improve our management of the economy. This is why as a fundamental pillar of our last budget we pursued the effective management of the economy as the number one priority. This we cited as important as we need to establish a solid foundation for building future sustainability, a necessary condition to achieve prosperity for all of our people. So far our current management of the economy has been getting positive reviews and yielding much needed benefits. We need to continue to consolidate our gains and implement our strategy. One of our major challenge is to develop a realistic plan and budget that will stimulate and generate growth and confidence in the future. We have to find new measures to improve our effectiveness. Like doctors, we are expected to cure all inherited ills immediately, even though in this case time may be the only true healer. As we deliberate today, I expect us to be interactive and productive. I want to assure you that we value your participation and contributions and look forward your several inputs. I thank you.