St. Vincent and the Grenadines’ EC$1.529 billion national debt is manageable, Prime Minister Ralph Gonsalves says.
Gonsalves, who is also Minister of Finance, said that the country’s national debt registered the least growth within the Eastern Caribbean Currency Union during the year ended March 2015.
The national debt of SVG increased by EC$14.13 million during that period, he said.
This compares to Antigua and Barbuda’s increase of EC$139.5 million; EC$23.85 million in Dominica, EC$28.8 million in Grenada, and EC$149.17 million in St. Lucia.
“I’ve always said we have a manageable debt in St. Vincent and the Grenadines, we are among the better performers in that regard in the Currency Union, and that we have laid out our strategies for growth and competitiveness among other things…” Gonsalves said Tuesday.
Speaking on the nation’s fiscal and debt situation, Gonsalves said data show that at the end of March 2015, SVG, both in relation to the primary and overall balance on the fiscal accounts, “that we are performing creditably”
“I just want to make the point that we have been managing our debt situation and our debt to GDP level is about 77 per cent and we have a medium debt strategy to have it at the 60 per cent threshold by 2030. In fact, we will arrive there much before 2030,” he said.
Gonsalves also commented on the health of the Bank of St. Vincent the Grenadines, the formerly state-owned National Commercial Bank (NCB).
Fifty-one per cent of the NCB has been sold.
He said there are two indigenous banks in Anguilla and one in Antigua that have been placed under the control of the Eastern Caribbean Central Bank.
“And the truth is this that our indigenous bank, the Bank of St. Vincent and the Grenadines, is performing well, both absolutely and comparatively,” Gonsalves said, citing the extent of non-performing loans.
He said Anguilla has almost 50 per cent non-performing loans on average for all banks, Antigua has just over 14 per cent, Dominica almost 15 per cent, Grenada almost 14 per cent, St. Kitts and Nevis about 19 per cent, St. Lucia approximately 19 per cent, and SVG 9.6 per cent.
The international best practice is 5 per cent.
“Particular context is taken into account, but when you are reaching numbers like beyond 10 per cent and going towards 20 per cent, you have some real challenges,” Gonsalves said, adding that when he came to office in 2001, the non-performing loan ratio at NCB was almost 20 per cent.
At the end of March this year, it was 6.3 per cent, he said, adding that this is the best performance in SVG.
He said the bank is also ranked among the best performers in terms of the low level of non-performing loans to total loans.
Gonsalves said that while some may say that maybe the bank doesn’t lend a lot of money, the figures show that it has the highest loan portfolio among banks in SVG: EC$558.7 million.
Jubilee Debt Campaign recently included SVG on its list of “countries currently in government external debt crisis”, a classification that Gonsalves said was “plain wrong”.
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