Antigua seeking to restructure debt portfolio

ST JOHN’S, Antigua, CMC -The Antigua and Barbuda government says it is moving to restructure the country’s debt portfolio and will launch a bond valued between US$250 and US$300 million to tackle high-interest domestic debts.

“We’re now seeking to float a bond to address the issue of the debt service ratio. Our goal is to secure cheaper funding and to settle some of the arrears, particularly with domestic creditors,” Prime Minister Gaston Browne said.

Prime Minister Browne said his administration is exploring options with Oppenheimer and possibly the Development Bank of Latin America and the Caribbean (CAF), expressing optimism about raising the necessary funds within 90 days.

He said the government is also holding discussions with international creditors to address various decades-old debt matters, including a Brazilian loan now estimated at US$44 million due to accumulating interest and penalties after it had originally been set at five million US dollars in the 1980s.

Browne said he has since reached out to Brazilian President Luiz Inácio Lula da Silva requesting a potential write-off of the interest and penalties associated with this loan.

“There was less than five million dollars borrowed back in the 80s for a Deep Bay development project, and it has now escalated to over $44 million,” he said, adding that the government is addressing obligations related to Venezuela.

He said the talks with Caracas are to reduce the more than $500 million to $250 million owed under the PetroCaribe oil initiative.

In addition, St John’s is hoping to discuss a separate US$50 million Venezuelan loan from a previous government.

Browne said that the aim of these debt restructuring efforts is to lower the country’s current debt service ratio from approximately 30 to about 20 per cent, thereby creating more financial flexibility for future government initiatives.

The government said currently, the debt service ratio accounts for an estimated $300 million annually, against government revenues of about $900 million.

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