The Dominica Freedom Party congratulate you the people of Dominica for your adherence to the social distancing recommendations and for your respect of the curfew and lockdown as our country seeks to minimize risk to life from the COVID-19 pandemic. We are thankful that no lives have been lost of the 16 persons officially reported to have been infected with the new coronavirus, most of whom have recovered. We urge our continue vigilance and pragmatism as the quasi-lock down and curfew is gradually eased.
But an economic disaster is certainly looming in our land – the result of a double whammy – loss of CBI revenue and the impact of the COVID-19 pandemic! A significant worsening in social conditions will result and the already-low quality of life in the nation will drop. A key challenge will be how to prevent the situation from becoming chaotic and how do we ultimately restore the economic health of our country.
But we as we have previously indicated, the economy of Dominica was already weak and declining prior to the impact of the COVID-19 pandemic. However, the COVID-19 pandemic is making the situation worse. To minimize the pain that is to come and to reposition the country’s economy, a number of strategies must be contemplated. In that regards it would be desirable for there to be prepared a meaningful rapid relief package and an economic stimulus package to respectively address the immediate social impact of the COVID-19 Pandemic on the people and awaken the economy. But given the lack of fiscal reserves and the poor state of government finances, the current administration will need to borrow to finance such a package. The Dominica Freedom Party has recommended that the government approaches the International Monetary Fund (IMF), the World Bank and the Caribbean Development Bank (CDB) for such support. Though there may still be fiscal financing shortfalls after inputs from these multilateral institutions, their inputs could be very helpful.
What then does the government need to finance? First, they need to finance a huge fiscal deficit (expenditure exceeding revenue) that was already confronting the country prior to the impact of the COVID-19 pandemic but that will be made much worst by the pandemic. This threatens to rattle the country including through difficulty to pay civil servants and cuts in expenditure to include that on social programmes.
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