SVG performing creditably with fiscal, debt situation – PM

St Vincent and the Grenadines is performing creditably within the Eastern Caribbean with regard to its fiscal and debt situation.

This declaration came from Prime Minister Dr Ralph Gonsalves last week as he reported on the 82nd meeting of the Eastern Caribbean{{more}} Monetary Council meeting, which took place on July 24 in Anguilla.

“In relation to the fiscal and debt situation in the currency union … [as at] the end of March 2015, the date will show that St Vincent and the Grenadines both in relation to the primary balance and overall balance in the fiscal accounts, that we have performed creditably,” Gonsalves told reporters at a press conference on July 28.

Gonsalves noted that over the last year, St Vincent and the Grenadines’ debt only went up by $14.13 million, which is considerably better than other countries within the union.

“Between March 2014 and the end of March 2015, you will see that the debt for Antigua and Barbuda went up by $139.5 million. The debt for Dominica went up by $23.85 million, for Grenada, by $28.8 million; St Lucia, $149.17 million,” he said.

“I just want to make the point that we have been managing our debt situation and our debt to GDP levels are about 77 per cent. We have a medium term debt strategy to have it at the 60 per cent threshold before 2030. In fact, we will arrive there much before 2030.”

According to Gonsalves, the Bank of St Vincent and the Grenadines (BOSVG) is also performing well, both absolutely and comparatively with regard to financial sector stability within the region.

Furthermore, he declared that BOSVG is also the best performer among commercial banks in St Vincent and the Grenadines and in the region, when it comes to non-performing loans.

“The non-performing loans, that is to say the proportion or percentage of loans which are non performing as a percentage of the total loans; in the case of Anguilla, its almost 50 per cent on average for all the banks. Antigua, 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 St Vincent and the Grenadines, 9.6 per cent,” the Prime Minister said.

Gonsalves, who is the minister with responsibility for finance in this country, also pointed out that the best practice standards dictate that non-performing loans be around five per cent.

“When you’re reaching numbers like beyond 10 per cent and going towards 20 per cent, you have some real challenges. I always indicate that when we came to office in 2001, the National Commercial Bank had a non-performing loan ratio of over 20 per cent and in stages we brought it down. First to 10 per cent and then to 5 per cent,” he said.

The Prime Minister revealed that as of the end of March 2015, the non-performing loans at BOSVG were 6.3 per cent. He also pointed out that while some persons may be of the opinion that the BOSVG was not lending much money, the bank has the highest lending rate, with loans totalling $558.7 million.(BK)