The United Kingdom is facilitating the BVI to borrow up to $426 million (just under half-a-billion dollars), though the territory is not legally allowed to borrow more than a quarter billion over a specified period.
Under a BVI-UK agreement called the Protocols of Effective Financial Management, the BVI is not permitted to borrow more than 80 percent of its recurring revenue, which stands at approximately $300 million-plus.
But, the UK is offering a US$426 million (£300 million) loan guarantee to the BVI, which makes the territory free to borrow that near-half-a-billion sum.
And while guaranteeing that sum to the BVI, the UK has not amended or relaxed the protocols agreement.
Opposition Leader Andrew Fahie pointed out the fault in the House of Assembly on Monday and described it as ‘backdoor move’ from the UK.
“If the UK don’t say while we (the BVI) are getting these loans we (the UK) are going to relax at least that section of the protocols, then they will be allowing us to get loans … and they will hold us responsible for what’s in the protocols, which going to carry the Agency pass five years up to 30 to 40 years,” Fahie said while making his contribution to the Recovery and Development Agency bill debate.
“They setting us up to kill ourselves. Once we sign that bill like how it is we would have officially signed our suicide note. It has to change,” he added.
The BVI must establish a Recovery Agency if it wants to benefit from the UK’s loan guarantee offer.
I want to support Agency, but …
The Opposition Leader said he will support the Agency as long as the aforementioned protocol agreement is relaxed or amended, and if the Premier reveals all other conditions of the UK’s offer.
“I want to say yes [to the Agency]. I don’t want anybody leaving from here thinking I want to say anything else other than yes. But I can’t say yes unless I have all the documentation,” Fahie said.
“I want to know the 80 percent limit in the protocol on borrowing levels must be amended for when we add $400 million to the existing outstanding loans, the BVI … will be subject to penalties from hence [forth], which could be direct rule. Those have to be amended.”
Premier Dr D Orlando Smith has repeatedly said that government does not intend to borrow the entire $426 million. He said government will borrow incrementally.
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