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”.
Related:
- Citing Cabinet memos, Eustace repeats claim that PetroCaribe contributes to ‘debt crisis’
- Did PetroCaribe put St. Vincent on ‘debt crisis’ list?
Really? From the Minister of Finance? Only now? How did he propose to deal with the debt while it was being accumulated? Can the Honorable Minister of Finance count to more than 10 with his shoes on and his pants zipped up? Come on now, this is not news. the reasonably intelligent among us already knew that.
What a damn shame and disgrace. SVG use to be one of the pillars that held the Eastern Currency up, for the 17 years of the NDP, the grown curve was rising steady and the NDP left a debt of about 300 million after debt forgiveness, and that is after 17 long years. The Brightest PM SVG ever had has already racked up over 1 billion dollars of debt in 15 years, but that is the low figure, if you account for the outstaning Petrocaribe debt that Scotia banks estimates at 900 million, you are looking at a debt of closer to 2 billion dollars for Gonsalves. Could you imagine that? Vincentians for generations are going to suffer to pay that back, when he leave and go home and sit down and cockup his foot living nice and drinking champagne and laughing. You and your children are going to catch hell.
How did this guy fool Vincentians into believing he was smart is something I still can’t figure out. All the lies and nice talk and all that had a price and Vincentians will pay for it. You all have no one to blame but yourselves for allowing this guy to carry on with his nonsense for so long.
This debt mite be manageable but where was all this money spend seeing that unemployment rate is still so high in st vincent ? dont get me wrong because under the previous Gov and the present one unemployment rate has never drop below 10% .today it has to be over 20%, we really need a better direction for our country. its really time for regular civilians to run our country base on common sense because our educated elected officials seem not be able to steer this ship through this progressing storm
I cannot believe a word that comes from the PMs mouth, the hidden or publicly undeclared debts added to what Gonsalves states is believed to be approaching $3 billion. Sorry but the declared $1.5 billion is not even feasibly true.
As for the statement that our national debt only increased by $14.35 million this period. He borrowed in 2014 from the NIS more than that, it was $15 million. Remember from sometime in 2013 through several months in 2014 the government failed to pay their 5.5% contribution to the NIS for government employees wages. Worse than that they failed to pay the 4.5% that the workers themselves contributed, that was a criminal act, that was fraud.
The government were so broke they couldnt pay the NIS, so they took a loan from the NIS for the same amount and paid the NIS with the very same loan. That means that the tax payers at some time in the future will be paying back the NIS loan that corrected the illegal action taken by the government in the first place. This was like robbing a bank and twelve months later going back to the bank and taking a loan to repay what you robbed from them. It does not make the original action any less of a crime.
Then they have borrowed about 60% of all the oil for fuel from PetroCaribe, we dont know exactly how much that was because its a family dynasty secret and the official auditor cant get proper sight of the accounts. They also borrowed and spent about 160 million on the airport during this period.
Then to slap us in the face again he has the gall to mention the NCB bank that he sold 51% of and its name changed to Bank of Saint Vincent. The bank was sold because the government had borrowed so much from them, much more than their statutory limits. So much in fact that the bank was about to go belly up and all the investors about to lose their savings. We were saved by the CDB who loaned us the money to get the bank out of trouble, on the understanding that the bank was sold. Gonsalves told us at the time it was a master stroke on his part, inferring that the sale was part of a plan, it was not, that was one of his worst lies yet.
Many parents in SVG sacrificed to send their children to universities to study economics and now some of them are employed as civil servants in this country and they have a lawyer who knows nothing about economics feeding them garbage.I know that Mr Arnhim Eaustace the economist knows better than what this PM is telling the nation.Why have we had consecutive years of negative growth?Why is so many business closing, putting people on the bread line?Why are they hoping that the Argyle airport would rescue them in this election that the PM is afraid to call?By the way Kenton Chance, I don,t know if you are the one who questioned the PM on the one month salary for civil servants but the month has ended and I have not heard if he met with the unions as promised.
This must be Jumby economics, because it can’t be anything else.