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The House of Representatives yesterday (Dec.16), approved the withdrawal of $1.1 billion from the Capital Development Fund (CDF), to be paid into the Consolidated Fund, to provide budgetary support for the 2008/09 financial year.
Minister of Finance and the Public Service, Audley Shaw, who moved the resolution, said this latest withdrawal represents the third for the fiscal year.
He told the Lower House that the bauxite industry was being challenged by the decline in international demand for alumina.
“The truth is that part of the global financial meltdown, has been the aggressive decline in the motor vehicle construction as well as housing construction industries, and those are the two industries that are the greatest users of the end product aluminium,” he pointed out.
“So, in a very real sense, the possibility is that some cut in production could take place and to the extent that there is a cut in production, then that of course would lead to a compromise for the Capital Development Fund,” he stated.
Opposition Spokesperson on Finance, Dr. Omar Davies, said members of the Opposition did not object to the withdrawal.
“The extent of the withdrawal from the Capital Development Fund, virtually taking everything out, is a signal that the Minister is doing this simply because he needs to do this,” said Dr. Davies.
The CDF was established under the Bauxite Production and Levy Act. It was promulgated in 1974 at the time when the bauxite production levy was imposed, and the proceeds of the levy directed to the CDF.