ST. JOHN’S, Antigua, CMC – The head of an International Monetary Fund (IMF) delegation that ended a two-week visit here recommends that the Antigua and Barbuda authorities continue their efforts to strengthen the main engines of growth.
Assistant to the Director at the Research Department of the IMF, Emine Boz, said in a statement that efforts should continue to increase flight connectivity and cruise ship homeporting.
“Operationalizing LIAT would help to improve intra-regional flight connectivity further and complement the recent expansion of other airline companies’ presence in Antigua and Barbuda,” she added.
Last month, Prime Minister Gaston Browne said his administration is going ahead with plans to establish a new regional airline even though it acknowledged a move by other sub-regional countries.
In response to an opposition question regarding improved regional transportation, Browne told legislators that it is well known that the government “has been struggling” with the cash-strapped LIAT (1974) Limited over the past three years.
Browne told legislators that due to a lack of commitment, his administration decided to pursue a new partner for the proposed LIAT 2020 “which will be a new legal entity that will not assume any of the liabilities of LIAT (1974).
“Whatever assets it acquires from LIAT 1974, LIAT 2020 will pay for them in full,” he said, acknowledging that “we were unable to attract investors from within the region; we went extra-regionally, and that is why we had to establish a partnership, with Air Peace,” a private Nigerian airline founded in 2013.
Boz said that St. John’s should continue to boost tourism during the low season, which would not only smooth hotel occupancy rates throughout the year but also make the country a more attractive destination for airlines.
“Several cruise lines plan to use Antigua and Barbuda as a homeport starting from 2023, and a further expanded capacity of the Antigua Cruise Port is expected to facilitate the arrival of larger cruise ships.”
She said also that measures should be taken to accelerate a reduction in unemployment and underemployment.
“Active labor market policies should be strengthened to help address the slow recovery in formal employment, which has remained almost 12 percent below its 2019 level in 2022. The existing one-stop employment center should enhance its capabilities to match employers with employees.
“The New Work Experience Programme should be made more effective by evaluating participants and ensuring their successful exit. The mission welcomes investments in vocational training and local universities, while vocational education could further enhance training opportunities.”
Boz said it will be critical to mobilize donor support for investments in climate resilience. Antigua and Barbuda is utilizing funding from the Green Climate Fund, Adaptation Fund, and Global Environment Facility to support 19 active projects of various sizes.
She said that given the fixed costs of developing and reporting, they are shifting their focus towards more significant projects, facilitated by upgrading accreditation levels with these funds. The island has operationalized the Climate Resilience and Development Fund, which could also help to co-finance climate-related projects.
The IMF official acknowledged that the transition to renewable energy will be challenging.
“According to the International Renewable Energy Agency, a successful energy transition, which could reduce the country’s energy costs by up to 40 percent (and reduce the impact of swings in global energy prices, would require up-front capital costs of up to around 25 percent of GDP to upgrade the electricity grid, expand the use of electric vehicles, and invest in new wind and solar generation.
Boz said the limited availability of domestic financing sources makes mobilizing donor resources to support these initiatives essential.
“The transition has been gradual as regulatory barriers have been slowing households and businesses’ utilization of solar power. However, efforts are being made to explore new solar and wind projects,” she said, adding upgrading the curriculum at the Antigua and Barbuda Institute of Continuing Education would help train new workers for this transition.
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