NASSAU — The government yesterday brought a resolution to the House of Assembly to borrow $465 million to finance the projected revenue shortfall in the 2013/2014 fiscal year.
This would add to the $650 million the government borrowed this year.
Government debt as a percentage of GDP is projected at 53.1 per cent at the end of this current fiscal year and 56.4 per cent at the end of 2013/2014.
According to figures attached to the budget communication presented in the House of Assembly yesterday, the national debt stood at just under $5 billion in 2012. That is 61 per cent of GDP.
Prime Minister Perry Christie said much of the money the government borrowed last year was required to cover unpaid financial commitments incurred during the Ingraham administration.
“The legacy of high public deficits and spiralling debt burden that we inherited is brutally onerous: almost one out of every four dollars in revenue collected by the government must be allocated to pay the interest charges on the public debt and cover the debt repayment,”‚said Christie as he presented the communication.
“Had we chosen to ignore the grave structural imbalance in the public finances, the debt would have continued to spin out of control.”
Committed to borrowing less
During a press conference in the Majority Room following Christie’s communication, Minister of State for Finance Michael Halkitis told reporters the government is committed to lowering its level of borrowing.
“We have introduced … a medium term strategy where we are gradually consolidating and putting the finances on better footing,” he said.
“We have to do it gradually so that we don’t put too much shock into the economy, and so while we are borrowing additional funds we are happy that we are moving in the direction where we are borrowing less.”
Despite the high level of borrowing, Christie pledged to return the budget to a surplus by the 2016/2017 fiscal year. (Nassau Guardian)