Premier does not regret rejecting UK’s $426M loan guarantee offer
Premier Andrew Fahie said his government does not regret declining the $426 million loan guarantee from the United Kingdom government back in 2019 given the current state of the world’s economy.
The Premier referenced an article written by the British media house BBC, stating the rise in inflation has caused the UK’s government interest payment on public debt to be increased by £1.6 billion or 36 percent in comparison to last year.
Fahie said forces here in the Virgin Islands and abroad tried to pressure his government in signing the loan guarantee regardless of the terms and conditions. However, he said the size of the package and projects were beyond what he considered prudent, given the dynamics of the ratios outlined in the protocols for effect finance management.
“Some of the terms and conditions needed adjusting and we proposed a more manageable number of projects for less money with more favourable terms,” Fahie said.
The Premier, who is also the Minister of Finance, said up until recently, persons were still saying that the government should have taken the money and he said he still stands by his decision.
“When you look at what is happening with other economies, and with the global developments and this includes developments that were not foreseen at the time such as COVID-19 and now the war that is unfolding in Europe — which is already having a global economic impact such as rise in oil and natural gas prices — which have the potential to disrupt global trade and also the climatic risk in this region.”
“I am sure you would agree that your government’s position on the loan guarantee was wise. Could you imagine if we had leveraged these Virgin Islands and then with the sudden and unforeseen spikes in the global economy, we had exceeded the ratios and protocols for effective financial management and the terms we had concerns about engaged?” the Premier questioned.
Fahie said the outcome would have several financial ramifications on the territory and its efforts to properly manage its own funds.
“If we had been short-sighted and hasty as those persons who were pushing us to agree, the Virgin Islands people would possibly have lost their hard-fought right to manage their own finances. With the guidance of God, your government has been making the correct decision to protect the Virgin Islands. Your government has been prudent, and your government has been responsible, and we continue to be and the record bears this out. Please. Don’t mistake the absence of noise for the lack of activity,” the Minister of Finance said.
Earlier this month, Opposition legislator Julian Fraser said the Fahie-led administration made a gamble when they refused the loan guarantee from the UK when it entered office, just a year removed from hurricanes Maria and Irma.
According to the Third District Representative, the decision to forego the offer from the UK government may have backfired given the unanticipated blow taken by the BVI’s economy because of COVID-19.
The legislator expressed that the administration, led by Premier Andrew Fahie, could have later accepted the UK’s offer and avoided embarrassment, but declined to do so.
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All happen is that them couldn’t get to thief none of it because they dont want to do proper accounting
This was a dumb decision. Good luck getting a loan with those guarantees now. Interest rates are going up and the government and a ‘financial’ minister did not take that into account.
He didn’t take the money and move the country forward???? Forward never backwards ever!!!
OLD FOOL TOOK THE VACCINES INSTEAD…
You are the worse leader the BVI has ever seen.
The worst is Olando Smith. Just everything bad.
Smith was garbage too smh… Is a tough call for who was the worst between him and Andy but I feel Andy got him… he not finished yet.
It’s unfortunate that Fahie does not understand the benefit of long term sovereign financing through the UK. The BVI could have borrowed funds at HISTORICALLY LOW INTEREST RATES in 2018 or even fixed interest rates to rebuild the territory over the last 5 years. A missed opportunity is an UNDERSTATEMENT for the financial illiteracy of his ‘Leader’. The BVI does NOT have a credit rating NOR does it have a stock market or central Bank. Any FUTURE borrowing will be 5-10 times MORE EXPENSIVE than any UK backed Sovereign loan as it will be at COMMERCIAL rates. Thank you for your ignorance AND ‘PROTECTING’ the economy..
this is gaslighting of the highest order. They are euthanising the BVI economy and lying about the reasons. This preening and strutting is to hide their intellectual vacuum.
This is by far the worst leader and the worst administration we have ever had… And at the most crucial time when we needed real leadership.
And please take down those obeah green cloth that you all put up all over the BVI. The big bottom one from east end want to maintain her position on all those government boards so she working her obeah early. Not this time!
You mean the one who cannot even spell Board?
Paid bloggers take a rest
Just think of all the projects with big pay offs and kickbacks you ,family and friends could of had
no that was the problem, the UK insisted on oversight how the money was going to be spend, which was not agreeable to our leader and his cronies.
He could have taken that for the Stimulus package and left Social Security money alone !!
I will ask the question again.
If the RDA was set up to manage the UK backed loan funds on recovery and development projects, and seeing that the money was never borrowed by the last administration or this current one.
What is the purpose of the RDA?
The BVI is in a better position because of the RDA. Seven road projects are completed with asphalt works. The Fish Bay road is progressing rapidly. 5 Administration Buildings were handed over – Theoldolph Faulkner in Anegada; Vanterpool Admin, Flax Admin and John E George Sr on Virgin Gorda plus the Albert Chinnery Admin Building in JVD.
Four reservoirs were built in three project locations – Zion Hill, Carrot Bay and Long Bush.
They’ve installed Sea Markers, provided restrooms and shade at the Baths, made improvements at the Bregado Flax Educational Centre, installed renewable energy projects in public buildings, hired interns and the list goes on and on.
Every minute the RDA serves the people of this Territory and there is a track record to prove it.