Dominican PM's Boasts of Assistance Refuted by Anguilla and

C O N F I D E N T I A L BRIDGETOWN 000761

SIPDIS
STATE FOR WHA/CAR

E.O. 12958: DECL: 2019/12/16
TAGS: PGOV PREL KDEM XL
SUBJECT: Dominican PM's Boasts of Assistance Refuted by Anguilla and
Antigua; Seen as Pre-Election Stumble

DERIVED FROM: DBHardt

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Summary

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1. (C) In what is seen as a significant pre-election mistake,
Dominica's Prime Minister Roosevelt Skerrit announced at a
political rally that his government had extended USD$13.5 million
in loans to Anguilla and Antigua to help its "downtrodden" fellow
members of the Organization of Eastern Caribbean States (OECS).
Upon hearing Skerritt's claim, both governments angrily denied
receiving any loans from Dominica. Skerrit's claims seem
especially dubious, as regional sources tell us he has had to turn
to Venezuela for loans to pay his own civil servants for the past
three months. Skerrit's unusual boast not only angered his
regional counterparts, but also prompted Dominicans to press for
wage increases at home if the government has so much money to give
away. Either way, it was a misstep in what is shaping up to be a
close election.



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The Big man on the Block

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2. (C) At a public rally December 9, PM Skerrit asserted that
Dominica's economy was performing so well that the country was
financially assisting fellow OECS member-states Antigua and
Anguilla. According to a local news report, Skerrit stated: that
Dominica was faring better than most because of the strong fiscal
policies and prudent management of the country. "Just last week,"
he continued, "the government of Dominica had to give to the
government of Anguilla some $12 million ($USD 4.5 million) because
things are difficult in Anguilla." Digging his hole deeper,
Skerrit continued, stating that "in the month of August of 2009 we
gave to Antigua over $24 million (USD $9 million) of our money."
In an attempt to show the strides Dominica has taken under his
rule, Skerritt added that the Caribbean community is "no longer
looking down on Dominica," instead, the region was now "looking up
to Dominica" and that Dominicans should be "proud."



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Antigua and Anguilla Quick to Respond

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3. (C) Antigua and Barbuda Minister of Finance Harold Lovell
responded the next day to Skerritt's claims, stating that he was
not aware of any direct assistance from Dominica. Lovell said that
the only assistance his ministry could track down was funding
related to the Eastern Caribbean Central Bank's (ECCB) bailout of
the Bank of Antigua over the Stanford unraveling. Anguilla went a
step further by issuing a press release discounting the Skerrit
claim, stating that Skerritt's statements do not "accurately
reflect the facts and can be misleading." Anguilla had contacted
the ECCB for a short term credit facility in November, but
specified that the assistance was not from Dominica.



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Astaphan to the Rescue

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4. (C) Judith Pestaina, leader of the Freedom Party, called for a
public apology from Skerrit for misleading the public. In what has
become common practice, Skerrit postponed answering any questions
and directed his legal counsel Tony Astaphan to "clarify" the
position. Astaphan, in a written article for Dominica News,


claimed that the opposition was just "splitting hairs and saving
face" and that Skerrit never mentioned that the money came directly
from the Treasury. Skerrit was simply referring to Dominica's
unused credit in the Fiscal Facility at the ECCB, he said, that had
been extended to both members for the restructuring of a loan and
providing a credit extension. Astaphan also went on the offensive
against both Antigua and Anguilla, criticizing their poor economic
performance and questioning their need to provide a prompt public
response.



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Reality on the Ground

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5. (C) According to Teresa Marshall, Permanent Secretary in the
Ministry of Foreign Affairs in Barbados, the situation is much
worse than Skerrit acknowledges. For the last three months,
Skerrit's treasury has been depleted and he has been forced to rely
on Venezuelan loans to pay the salaries of public workers. For
their part, Dominica's public workers were quick to pounce on
Skerrit's statements to stake a claim for a pay raise. The
statement left many Dominican's perplexed, wondering how their
government was able to assist wealthier neighbors, given Dominica's
own quite apparent financial problems.



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Comment

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6. (C) Skerrit has long boasted of his success in steering the
economic ship of Dominica. The reality is much different, as the
country has experienced mild GDP growth coupled with high
unemployment. Because of its limited international exposure, the
country has not been hit as hard by the global economic downturn,
but they also did not benefit much from the years of economic boom.
With elections a week away, the statement was a political stumble.
Most Dominicans have already made up their minds on which way to
vote, according to observers, so it is hard to say how much this
might hurt the PM. But in a close race, shifts of a few votes from
voters who may now question Skerrit's credibility could make a
difference.
HARDT