Gov’t seeking to guarantee a $5.8M loan for BVIPA
Roughly four years after becoming a $50 million loan guarantor for the cruise pier project, the Dr D Orlando Smith-led government is now seeking approval to guarantee an additional $5.8 million loan for the BVI Ports Authority (BVIPA).
Effectively, a loan guarantor is a person or entity (BVI Government) that promises to repay a loan if the original borrower (BVIPA) fails to pay.
Section 33 of the Public Finance Management Act says government is powerless to guarantee loans unless they are given approval from BVI parliament.
Premier Smith will, therefore, be seeking to get the proverbial green light from the members of the House of Assembly on Thursday, September 13.
Purpose of the loan
The BVIPA is seeking the loan from the First Caribbean International Bank (Cayman) Limited and its affiliates.
The Premier said the purpose of the loan is for the BVIPA to purchase ‘port equipment’, guarantee an unspecified ‘a line of credit’ or loan from the bank, and to fund what are known as ‘interest and net swap payments’ of an existing loan.
A total of $1.7 million is to be used to purchase the port equipment, $2.1 million to be used for the so-called interest and net swap payments, and the BVIPA will use the remaining $2 million to guarantee the unspecified line of credit.
Notably, government is seeking approval to be a $5.8 million loan guarantor for the BVIPA at a time when it is also seeking an unrelated £300 million loan guarantee from the United Kingdom.
That £300 million loan guarantee is so the BVI can borrow to fund its recovery and development plan.
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Doesn’t Ports already owe government $8 million for the East End Sewer Project?
When do we get to see the audit to see how much these clowns borrowed and what they spent it In?
Way to much– unknown and unspecified and line of credit and only 1.7M defined. Agin way to vague for us. (didn’t see any mention of size of opening of “cookie jar” for dipping into?)
UK guarantee BVI govt loans, BVI Govt guarantees Ports Authority Loans, BVI Govt takes up 7 Million and say ‘tek this’ to so-called airline promising direct flights from EIS to MIA. Now the same BVI Govt don’t have no money, no up to date audits or financial statements. Sounds like Archie’s comics
With no ship traffic and reduced revenues since Irma the Government finds it is unable to pay the interest due on the original loans for the cruise port….more money is now needed to pay to support the cruise port operations!….the cost of the cruise port plus interest payments is likely to be $120 million or more before it is all done! Very sad when the original costs were estimated at $50M!
The dock portion alone on the project was $40mil and if you do some research that’s the real cost of a pier that size so there is no way they could have built the dock/pier plus develop the landside turn key for $50mil.
I thought mark said that the port was bringing in a hundred million per year?
Doc we need back that 7.2 million before you leave office
For anyone who wants to understand this, the government is borrowing $2M to pay for the interest on an existing loan. This means that they are borrowing to pay the borrowing…sounds like a serious situation
Will the good Governor release the loan and other financial documents associated with the original suspicious deal? What was the original deal. Who received our money?
Will the good Governor prosecute the finance minister for refusing to release the audit as required by law?
When is the Port going to pay back the $8M borrowed from the East End/Long Look (why are they seperate districts?) sewer project for the Tortola Pier Park project? The Port shouldn’t be in the precarious financial position that it is in. The Port is a statutory body ( self supporting) so why is it supplementing general government operations? The Port appears to be a cash cow for general government. True, the Port should pay for services received from other statutory bodies and departments. Similarly, other statutory bodies and departments should pay the Port for services received.
Government is taking most of the departure tax from the Port. Further, other departments are using Port facilities but are not paying any rent, utilities ……..etc. This practice is not reflecting the true cost of these departments operating cost, over stating their revenue.
The Tortola Pier Park initial construction cost was severely understated. It was listed at $50M but thus far the tally is approximately $83M. Was this $33M delta due to poor estimating or the $50M was a teaser number, a selling point?
What happened to the $25million line of credit the NDP opened up with CIBC in 2016? Has that been arsed away as well?