PM: ‘Bureaucratic snafu’ resulted in late Kuwaiti loan payment

“A bureaucratic snafu” prevented this country from paying the Kuwaiti Fund on time, says Prime Minister Dr. Ralph Gonsalves.{{more}}

He told Parliament on Tuesday, May 24, his Unity Labour Party (ULP) led administration had never defaulted on a loan, since forming Government in March 2001.

Gonsalves’ statement came in relation to a question by Leader of the Opposition, Arnhim Eustace, in Parliament, who sought to find out whether the Kuwaiti Fund has been paid by this country’s Government, for the expansion of VINLEC’s Cane Hall Power Project. Eustace also sought to find out if there are any arrears of interest, what is the principal on the loan and when was the payment made.

“I repeat, I am not defaulting on a loan,” said Gonsalves.

Gonsalves said the loan that Eustace referred to had been paid. He said on April 27, VINLEC had issued instructions to the Eastern Caribbean Central Bank (ECCB) to make the payment, which was made on May 3. He disclosed that the Kuwaiti Fund acknowledged payment by letter in May.

The Prime Minister noted that 27 payments were paid before, and on no occasion had the Government missed a payment.

He stated that every year on March 1 as well as September 1, an instalment is to be paid on the loan. He gave the loan amount as EC$3.22 million and noted that prior to the last payment or the 28th payment, this country had repaid EC$2.9 million.

Explaining what had transpired leading to the late payment, Gonsalves said the 28th payment was due on March 1, 2011, but at that time, VINLEC did not receive the normal remittance instruction from the Ministry of Finance officials.

“But over at VINLEC, the person who was there also was sleeping on the watch because it wasn’t until the 11th of April that they realised that it wasn’t paid and they wrote themselves. They wrote the Kuwaiti Fund to find out what is happening to the remittance advice. And the Kuwaiti Fund said ‘Wey you talking about remittance advice? We sent that remittance advice to the Ministry of Finance officials since January,’” said Gonsalves.

“And that’s all that has happened …. We didn’t contract this loan; that is to say this Government. It was contracted by the NDP administration. They didn’t miss a payment and we haven’t missed one, until the 28th when the bureaucrats screwed up,” said Gonsalves. (HN)