CurrentAffairs
The State ofthe Nation The Way Forward
Leader of Govt.Business Hon. McKeeva Bush
The following is the full text of the televisionaddress delivered by Hon. McKeeva Bush, Leader of Government Businessand Minister of Tourism, Development and Commerce on Thursday,9 January 2000.
It is with great pleasure that I take thisopportunity on behalf of the Government to wish all citizens,residents, investors and visitors a very happy New Year. The dawningof the millenium was an event which the Caribbean together withthe rest of the world looked forward to with great anticipation.The promise of a new era of growth stimulated by the free marketmovement and the advances of technology has failed to materialize.
Unfortunately many of the developed countriesview the challenges presented by the globalization movement ascapable of disrupting their economic dominance and introduceda number of initiatives to eliminate this challenge. These initiativeshave damaged the economic viability of many small countries withmarginal economies and the Caribbean together with the CaymanIslands has been severely affected.
This together with the slowing growth inthe world's leading industrialized nations and the tragic eventsof September 11th have caused, what can best be described as,a worldwide economic crisis which has spread to our little countryand affected the main engines of our economy, tourism and finance.This crisis has lead to a significant decline in our revenue baseas a result of which our newly formed government was faced witha very unpleasant task of introducing a series, of what we hopewill be temporary revenue measures. The budget that was recentlypassed for this year recognizes that the country has no reservesto draw on if revenue does not materialize.
The country could not afford to borrow tocover the deficit, as $54 million was borrowed in 2001. When thisgovernment took the reigns of the budget after November 8, 2001we found that there was a gap of 93 million dollars between revenueand expenditure.
The government wishes for every man, womanand child to understand the grave financial situation the countyis in presently and we are determined to turn around this position.
As you all will have recognised we had verylittle time and very little choice and we recognise that someof these measures will indeed cause some hardship to some areasof our economy. We are committed to alleviate this hardship andto reverse these measures as soon as possible. With this commitmentin mind I should like to outline our philosophies and plans.
1. The government and the UDP are firm believersand supporters of a democratic free enterprise system in whichthe private sector should be encouraged to provide the impetusfor growth.
2. The government should strive to operatein a manner similar to business in the private sector. It shouldseek to reduce its expenditure and broaden its economic base.History is ripe with examples of countries, which have introducedexcessive revenue measures and suffered declining collectionsover a short period of time together with social problems.
3. We believe our country can no longertolerate or afford a system of government, which consumes 80.5cents in every dollar collected in recurrent revenue to meet recurrentexpenditure. Such a percentage is not sustainable in any wellrun economy.
4. We believe that our society should beinclusive and like the United States of America, our strengthswill lie in our diversities. Those who have chosen to come toour shores and to remain and play an integral part in the developmentof our community and our country should be welcomed, and madeto feel at home together with their children who may know no otherplace and whose friends are our children.
5. We believe that the mistakes of the pastshould be remedied and that our government should be a lean efficientbody providing a fast, friendly and first class service to allcitizens, residents, investors and visitors. We believe that redtape should be replaced with a red carpet, efficiency rewardedand inefficiency not tolerated. It is significantly more difficultto create wealth from poverty than it is to alleviate povertyfrom wealth.
6. Our economic base must be expanded, labourwhen not available locally, made available quickly. The opportunityfor the progression of our people by providing them with a firstclass education, on the job training and deserved job promotionis essential. An expanding economy will provide jobs for our peopledisplaced from the down-sizing of Government. Every effort willbe made to re-train our people and to ensure the opportunity forthem to move into these jobs.
7. We oppose all forms of income tax, propertytax, payroll tax, estate tax and any form of direct taxation andwe are committed never to introduce such measures.
8. We believe in private enterprise andthe development of a much closer and inclusive working relationshipwith our business community who we expect to provide constructiveideas and constructive criticism, from which will flow actionbased upon agreed ideas, all of which should be aimed at improvingour country and our people in order to provide a better futurefor our youth.
9. We believe that any capitalist orientatedsociety such as ours must be balanced with compassion for ourless fortunate, elderly and disabled and that where necessarythe government and the private sector must work together to providethe necessary services.
10. We believe that in many areas of governmentalservices, there is much room for improvement and that the mainengines of our economy which produce revenue and jobs, i.e. finance,tourism and construction, must be reinvigorated. Our objectiveis to maintain and improve the quality of life of our people,which will create the jobs to pay the bills.
With these beliefs and goals, we plan withthe assistance of everyone in the country to start working torejuvenate our economy, our attitudes and our working relationshipsand I take this opportunity to outline some of our plans whichwe intend to start working on immediately:
a) An examination of our governmental departments,agencies, bodies and statutory corporations with a view to improvingservice and significantly cutting costs. In this regard each Minister,starting with my own ministry, will within 90 days examine allpossible ways to improve our service and to cut our costs, hopefullyby a minimum of 10 percent, within the next twelve months. HisExcellency the Governor has set in motion the efficient scrutinyof government departments as recommended in the review of theCivil Service which was commissioned in 2001, from the centerfor Management and Policy Studies in the UK.
b) With a view to encouraging investmentsand facilitating investors, we will examine all ways to cut redtape and to replace the same with red carpet service. In essence,providing a one-stop shop for inward investment. To this end,our Cayman office will open its doors by the end of March 2002followed with New York and London by November 2002. This willalso create some of the greater efficiencies that I have mentionedby amalgamating a series of units and areas presently existingin the government, with the aim of providing to the potentialinvestor an informed, consistent and sophisticated image of investmentopportunities in these Islands.
c) We will establish a new working relationshipwith the private sector to identify areas and methods in whichour economy can be encouraged to grow and in which we can togetherencourage new development, new products and new thinking whileat the same time preserving our culture and our environment.
d) We will examine ways to provide incentivesto those who wish to make a significant investment in our countryand to encourage them to remain and become part of our community.
e) We will ensure that in the future whilewe are committed to meet our international obligations that wewill obtain the necessary expert advice and analysis in orderthat we may understand the consequences and advantages of anyproposed decisions. Whenever possible and wherever we are allowedwe will distribute drafts for public comments as is the practicein the United States of America. Good leadership is at times knowingwhen to follow.
f) We will meet with various members ofour tourism sector to discuss measures necessary for the developmentof new products. Whilst our competitors, approximately 170 countries,have three "S's" namely, sun, sea and sand, these areGod given blessings which we too enjoy, but we must carefullynuture and promote our special additional advantages; our three"S's" SAFETY, SECURITY AND SERENITY. These attributesallow us a competitive advantage.
g) We believe that allowing multifunctionallabour will enhance our productivity and cut the costs in thetourism and construction industries, an essential ingredient totheir regrowth.
h) We will examine or regulatory environmentto ensure that not only do we meet accepted international standardsbut that our regulatory environment is cost effective, relevantand continuing to be conducive to attracting quality financialservices and business. Failure on this scope is not an optionfor our economy. We believe that the appointment of internationallyrecognized persons to the Board of the Monetary Authority willvastly compliment the strengths of the Authority in performingits vital functions. The Authority must become independent withinthe next 100 days.
i) We will examine the services of the variousagencies and their ability to encourage the advancement and thegrowth of our financial industry which is essential to our economy.
j) We will examine the efficiencies of thevarious agencies and their ability to encourage the advancementand the growth of our financial industry which is essential toour economy.
k) We will examine and seek to put intoplace all necessary measures which can enhance the privatizationof services now being offered by the government. In this regardthe newly appointed board of Cayman Airways has been requestedto examine how it may best operate the airline within its currentrevenue projections. The government is no longer capable of providingopen-ended subsidies to the airline.
l) We will continue to streamline our immigrationprocess and endeavour to provide a fast, efficient and friendlyservice to the private sector and our visitors.
m) We will continue to work on the liberalizationof our telecommunication services and/or seek ways to make thecosts thereof more attractive to persons while maintaining a reasonablereturn on investment capital.
These are some of the main objectives whichwe hope to be able to achieve over the next twelve months. Inorder to do so the government will seek the assistance of variouspockets of expertise within the private sector. Working togetherto overcome the difficulties which have been encountered, is inour opinion, the most productive and efficient manner to achieveour goals in the short-term.
In these very difficult times we challengeeveryone to make an extra effort everyday to assist in the re-growthof our country. We challenge every member of government and everyemployee, starting with the immigration officers at the airportto greet every visitor, be they residents or tourists, with asmile to welcome them to the Cayman Islands. We challenge everyperson to put a little extra effort into every task that theyperform each day.
To take a minute to assist our visitors,to welcome them with a smile, to pick up a small piece of paperon the ground. Each and every act of kindness and assistance willgo a long way to enhancing our reputation and to building ourcountry into one in which every person, whether they live hereor visit, can proudly say that they have never experienced sucha warm, friendly and efficient people anywhere in the world.
Ladies and Gentleman, I know that the governmenthas an extremely challenging and difficult task ahead which weare prepared to work day and night to achieve and that with yourhelp and with God's blessing we will be able to rebuild the foundationsof our economy and provide for our people an opportunity for themto enjoy safety, security, serenity, happiness, prosperity andto work towards leaving our country a much better place for ourchildren and grandchildren to enjoy.
May God Bless you all.