Why Eustace’s IMF predictions fell flat

Tue, Dec 13. 2011

Editor: We all know the story of the Boy who cried Wolf and the fatal lesson that boy learnt. There have been many attempts by the NDP to cry Bombshell. One would recall the 2010 NDP Convention before the elections, when Vynnette Frederick forecast a Bombshell which turned out to have no fuse.{{more}}

Similarly, the last five months has witnessed a desperate attempt by Arnhim Eustace to pin his hopes, credibility and reputation on predicting a damning, catastrophic 2011 IMF Executive Council economic report.

The IMF Mission came to SVG from August 10 – 19, 2011 for their annual National (Article IV) review and met separately with Government officials, the Opposition, business community and the Unions. They published a brief statement on their findings on August 25th and after returning to Washington, they usually hold an IMF Executive Board meeting, to approve a more detailed report. This meeting was initially scheduled for October 2011.

Eustace simply could not wait for this report. A negative report might vindicate his lackluster leadership. He became increasingly anxious, inpatient and then started saying some very strange things, including predicting how the report would read. In the NEWS, Friday, September 30, 2011 page 13, the NDP said: “Our national debt has long since passed One Billion, capital projects are not happening, and we await the IMF with baited breath given their two recent visits to the government”.

Astonishingly, Eustace had been fooled by the fact that two IMF teams had visited, into misinterpreting that two visits meant there was a very serious problem. In actual fact, one team was related strictly to SVG national accounts and the other team focused on OECS and East Caribbean Central Bank (ECCB) matters. In previous years, the two teams typically came to SVG together (at the same time), but schedules did not allow this in 2011. Arnhim should have known this and if he did not, it again raises serious questions of competence. However, even after an explanation for the two visits was confirmed; he persisted in claiming the two visits spelled doom for SVG.

Initially, Eustace declined to report that several other OECS countries had debts over 2 Billion and one over 3 Billion. Or that SVG had one of the lowest debts in the OECS and the lowest Debt to GDP ratio, a fact he later admitted when he suggested SVG was now financially able to float a massive 180 Million bond to pay off CLICO and BA clients.

In the strangest and most unpatriotic Independence message ever, captioned “He who has eyes to see,” Searchlight October 21, 2011, page 25, Eustace said this: “With ears cocked Vincentians now await word from the IMF as to its recommendations for dealing with our shocking economy – as trucks continue to roll out at the untimely and therefore unlikely international airport project”. With this, it was becoming clearer that one-eye man is King in blind man (NDP) country (no offence meant to the blind). Eustace was taking his NDP believers on yet another rollercoaster ride (like Banana shipment suspension and the Tug boat saga), a joy ride that as usual, always comes to an abrupt end.

When the IMF Executive board meeting was postponed in October, Eustace again cried foul, falsely claiming that the Government was the cause of the postponement of his predictions and bombshells. The NDP then floated rumours of a 10% cut in salary and 10% layoffs in the civil service, after the IMF had made similar suggestions to Barbados.

At the November 2011 NDP convention Eustace said: “The man who describes the IMF as schizophrenic does not have a brain” and further stated “When your hand is in the lion’s mouth you have to ease it out. So it really is brainless at this point to attack the IMF. The Prime Minister MUST come clean about what he has been told is the pill every Vincentian has to swallow, since he has mismanaged and brainlessly mined the economy.” What then followed was Arnhim’s worse pronouncement and most telling of his level of desperation, when he said “We are facing the IMF with our knees buckling.

Now that the Executive Council report is out, Arnhim’s words and predictions have once again fallen flat. Where’s the PILL! Whose knees are buckling? Following the IMF’s discussion with the Opposition back in August, Eustace was certain that he had convincingly painted a horror picture to the IMF, but they saw through his efforts. What was he thinking, how could he stoop so low? The IMF Executive report was actually full of praise for the Government’s efforts in a challenging economy and the language used “WE WELCOME THE EFFORTS” was in high contrast to language used in many other Caribbean Islands. So until the next attempt to mislead our people, we must all learn the lesson of the boy who cried Wolf! and the one who claims buckled knees.

Dr. Jerrol Thompson