Business

Govt to seek ‘longer term borrowing’ later this year

The government will seek longer term financing toward the end of the year to continue to fill in the revenue shortfall gaps caused by the economic crisis from the COVID-19 pandemic, Deputy Prime Minister and Minister of Finance Peter Turnquest said.

The government borrowed $1.54 billion during the 2019/2020 fiscal year and has projected to incur a deficit of $1.3 billion during this fiscal year.

“That 50 percent of revenue that is lost is lost, we’re not going to get that back. So, we have had to borrow in order to fill that bucket. So we would have gone out and secured bridge financing, meaning short-term financing, of some $300 million to carry us through this period until we go out for our long-term financing, which will form a part of that $1.3 billion that we’ve talked about earlier that we plan to borrow this year. And later this year we will go out for longer-term borrowing, issued bonds, that will rack up or pay off this $300 million as well as carry us through the remainder of this period that we anticipate we will have a revenue shortfall,” Turnquest said.

“This should cover us through the end of the mid-November time frame, depending on how things work out in terms of the recovery. We may have to make adjustments so that we stretch longer. But right now we’re projecting that this will take us through the mid-November time frame when we anticipate that the tourist economy will start to return.”

The government has said it will seek to borrow the bulk of its expected $1.3 billion debt load in foreign currency from institutions such as the World Bank, the Caribbean Development Bank (CDB) and the Inter-American Development Bank (IDB), which are likely to provide the best possible rates.

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Paige McCartney

Paige joined The Nassau Guardian in 2010 as a television news reporter and anchor. She has covered countless political and social events that have impacted the lives of Bahamians and changed the trajectory of The Bahamas. Paige started working as a business reporter in August 2016. Education: Palm Beach Atlantic University in 2006 with a BA in Radio and Television News

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