Government to guarantee $40 million loan for SVG Port Authority

PARLIAMENT has passed a resolution for the government to stand as a guarantor for a $40 million loan for the St Vincent and the Grenadines (SVG) Port Authority.

The resolution was tabled in Parliament on Tuesday, October 15, 2024, by Minister of Finance, Camillio Gonsalves who explained that the loan is to be used for the purchase of equipment under the Port Modernization Project.

Leading off the debate on the resolution, Minister Gonsalves said the SVG Port Authority will use $10 million from its own funds, to complete the $50 million which is needed to purchase the equipment.

“What the Port Authority has done, is use its $10 million to pay down on the various pieces of equipment, because some of them require deposits so that the process of purchasing can begin even before we receive the legislative authority and the loan.”

The SVG Port Authority will obtain the $40 million loan through a bond on the Eastern Caribbean Securities Exchange (ECSE). It will be funded by the Bank of St Vincent and the Grenadines (BOSVG), and the Grenada Cooperative Bank, in the sum of $20 million each.

With the SVG Port Modernization Project on schedule for completion by May, 2025, Minister Gonsalves said the equipment will arrive between November this year and January, 2025.

“The Port project itself is now estimated to be about 68 per cent complete. The equivalent of US $140 million has already been disbursed, and the resources from the CDB, the UK CIF have already been exhausted,” he said.

Minister Gonsalves added that there was damage to the port when St Vincent and the Grenadines was struck by Hurricane Beryl on July 1. He, however, pointed out that damage from the hurricane to the port now under construction, was “miniscule” in comparison to the damage at the main Kingstown port. The Minister said government does not anticipate that it will be called upon to pay the loan for the SVG Port Authority at any point in time.

“The Port Authority has demonstrated itself to be profitable for an extended period of time, has demonstrated its ability… to be able to carry this loan comfortably,” he said in Parliament.

“We don’t have any apprehension in anyway that we will be called upon to act on this guarantee.”

The minister said on completion of the port project, St Vincent and the Grenadines will have one of the most advanced ports in the Eastern Caribbean. In her contribution to debate on the resolution, Minister or Urban Development, Senator, Benarva Browne said the construction of the modern port in Kingstown, is critical to the overall development of St Vincent and the Grenadines. She said government is providing a resilient port, and will continue to see the transformation of capital, Kingstown.

Other members on the government benches as well some in the Opposition also contributed to debate on the resolution.