Government moving in right direction on debt: Ubaldus Raymond

The Minister in the Ministry of Finance, Dr. Ubaldus Raymond says the government is moving in the right direction with its plans to reduce the island’s debt.

He made the comment ahead of a Senate meeting this week where a motion was considered for the government to borrow EC$262 million for the refinancing of existing debts.

Dr. Raymond said the International Monetary Fund is also pleased with the measures being taken by St Lucia to manage the island’s debt levels.

“We are trying our best to see how we can reduce on the treasury bills which carry higher interest rates and of course higher rollover risks. We are trying to see how we can lengthen our borrowing through bonds of course and to reduce the interest rates on these bonds,” Raymond said.

“As a government, I think we are in the right direction. We are trying to put a debt profile that is very sustainable, that will be able to give the government enough space, in terms of cash flow. We are doing the right thing,” he added.

In its latest report on St Lucia, the International Monetary Fund (IMF) asserted that “corrective measures should be supported by a multi-year consolidation plan to attain the 2030 debt target of 60 percent of GDP.”

12 Comments

  1. Jacques Boucle
    June 30, 2017 at 11:46 am

    If the administration continues on its economic trajectory, among other things, then we should expect ominous times ahead. Borrowing to refinancing your existing debt is not sound economic strategy. Later I guess you will borrow to re-restructure your debt again. Having imposed a three-year moratorium on estate taxes and a reduction in the value-added tax (VAT) what results were you expecting Dr. Raymond? Now that your egregious lies and mendacious propaganda are being disproved you are still insisting that the country is moving in the right direction. What a shame!

    1. JG
      June 30, 2017 at 12:47 pm

      “Borrowing to refinancing your existing debt is not sound economic strategy. ”

      Not entirely correct.

      If my predecessors borrowed at a high interest rate and I can get a much lower interest rate now, I can borrow the amount I need to repay the original debt and be paying less interest going forward.

      1. Jacques Boucle
        June 30, 2017 at 2:18 pm

        JG you are absolutely correct in terms of refinancing to procure a lower rate. However, if a government obliterates its revenue base and does not curb spending it will have a perpetual deficit. That is the fundamental issue. Again, your refinancing comment is true.

      2. Anonymous
        July 1, 2017 at 9:29 am

        While technically true it really doesn’t take care of the issue. If you can borrow now at a lower rate it means that ALL interest rates are lower. It means that banks make less money. It means they have less money to lend. It also means the economy is in a mess. Lower interest rates in a monetary policy tool used by central banks to try to stimulate economic growth when things are bad. Very bad.

    2. Anonymous
      June 30, 2017 at 1:00 pm

      No gov’t ever repays debt. They always refinance.

      “We are trying our best to see how we can reduce on the treasury bills which carry higher interest rates”

      Really! Is that what an economics Minister is saying. No sir. Treasury Bills ALWAYS carry lower interest rates that Bonds. The only reason you are looking to sell more bonds is because the higher interest payments are staggered over a much longer period because you are unable to pay off T-Bills at maturity. Don’t be an idiot Mr. Raymond.

  2. Anonymous
    June 30, 2017 at 11:47 am

    You idiot. Has no shame. Exposing urself to every woman is shameless. That’s the worst government st lucia has ever had. Come next election I won’t vote for urll bunch of dogs

  3. Alvin Ernest
    June 30, 2017 at 2:16 pm

    It is time for small economies to rethink the rules and foundations of their economics… Be careful, because the rules and ideals of the IMF do not favour the conditions and characteristics of small developing economies… That is why ALL developing economies are locked on a merry-go-round that leads to the doors of the IMF every 10 years!!!! What the IMF fails to consider is that developing economies can and should expect to have a higher debt to GDP ratio than developed economies, after all, their advanced developed infrastructures already lower their inherent risks… The problem with the Caribbean’s economic model is that it is too dependent on tourism, moreover, its Achilles Heel is an unsustainable import bill… driven by too much satellite TV fostering a “copycat” culture that lacks any regional & local innovation impetus! What initiatives do local and regional governments have to cultivate and harvest regional and local innovation to improves the quality and quantity of life for Caribbean citizens? That is the question that will open up a new economic landscape for St Lucia and the Caribbean in general!!!!

  4. Vibz
    June 30, 2017 at 2:17 pm

    The government’s financial health is critically important to good governance. If the fiscal state of affairs is in bad shape then every government program is negatively impacted. The country’s economy was in ICU when it was inherited by the present ruling regime. I pride myself on being fair. To restore the economy to any semblance of health cannot be done in one year, it would take multiple years. No government has a magic wand. Too many people have become prisoners of NOW. I’m willing to give the government some more time to get its fiscal house in order. This is only fair. On crime, I give the government a failing grade because I’m not seeing any concrete, purposeful nor practical initiatives to counteract the unprecedented increase in the savage butchery of citizens.

  5. Anonymous
    June 30, 2017 at 2:17 pm

    I cannot take anything that this man says seriously. He is a joke. Why is he still in government? He can’t talk to us and behind closed doors is bomb he making.

  6. maxton
    June 30, 2017 at 2:22 pm

    JG you are absolutely correct in terms of refinancing to procure a lower rate. However, if a government obliterates its revenue base and does not curb spending it will have a perpetual deficit. That is the fundamental issue. Again, your refinancing comment is correct.

  7. JG
    June 30, 2017 at 4:14 pm

    We all agree there is a problem, we all agree the current solutions are not working. Can we come up with better solutions?
    I’m sure the ministers would not refuse our help.

  8. Vaughn Blanchard
    June 30, 2017 at 8:55 pm

    We all ought to play our part as individuals by reducing our individual debt levels.

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