Economic and Financial Review - June 2019

June 2019 Economic and Financial Review SAINT CHRISTOPHER (ST KITTS) AND NEVIS

revenue collected from value added tax ($0.9m) and insurance fees ($0.5m). Slightly lower receipts from taxes on international trade and transactions (0.8 per cent or $0.6m) had a moderating effect on the overall increase in tax revenue, as proceeds from environmental levy and customs service charge declined by 18.3 per cent (0.7m) and 4.2 per cent ($1.0m) respectively. Current revenue was supplemented by budgetary grants of $15.8m, 4.8 per cent ($0.7m) higher than the corresponding period of the previous year. On the spending side of the accounts, current expenditure rose by 0.8 per cent ($2.8m) to $332.2m during the period under review, reflecting growth in outlays for transfers and subsidies and personal emoluments which was almost offset by declines in spending on goods and services and interest payments. Expenditure on transfers and subsidies increased by 16.9 per cent ($12.6m) to $86.9m, partially reflecting higher outlays for public assistance. Spending on personal emoluments and wages also increased by 3.8 per cent ($5.4m) to $147.9m. In contrast, payments for goods and services decreased by 12.8 per cent ($11.7m) to

$79.7m due to a reduction in legal claims against the government, while outlays for interest payments, which were primarily domestic, fell by 16.5 per cent ($3.5m) to $17.7m. Capital expenditure increased by $26.5m to $78.8m, largely associated with the continued implementation of key capital projects such as; the upgrade of the island main road project, the road improvement project and other infrastructural improvements in St Kitts. In Nevis, construction activity included the hospital expansion, the construction of the new water taxi pier and road works. Concurrently, capital grants declined by 56.4 per cent ($4.7m) to $3.6m during the period. The fiscal operations of the Nevis Island Administration (NIA) resulted in a deficit of $3.6m in the first six months of 2019, in contrast to a surplus of $5.5m in the comparable period of the previous year. Current expenditure rose by 7.1 per cent ($4.4m) as spending on goods and services ($4.1m), personal emoluments ($1.0m), and transfers and subsidies ($0.5m) increased while interest payments declined by $1.6m. Capital expenditure was essentially unchanged from the previous year at

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Eastern Caribbean Central Bank