Pierre not enthusiastic about NIC $100 million loan to government

By Gideon Aurelien

Raymond (left) and Pierre

(SNO) – Opposition Leader Philip J. Pierre has accused the government of spending more money than it makes and has shown not to be enthusiastic with the terms under which the government was able to borrow $100 million from the National Insurance Corporation (NIC) to settle two bonds that matured last week.

Pierre, today (August 6, 2018) at a press conference, told reporters that pensioners will be making a one percent profit from government’s borrowing of $100 million from the NIC, seeing that the money was loan to the government at an interest rate of one percent.

He compared that to the 7.25 percent interest rate government was able to sell its most recent set of bonds.

Pierre wants to know who are the persons or companies that have brought bonds from the government, lamenting that the names of such persons or entities should not be shrouded in mystery.

The opposition leader then attempted to take the wind out of Minister Ubaldus Raymond’s sails when he (Raymond) applauded the Ministry of Finance for being able to sell the recent batch of government bonds at a 7.25 interest rate.

Raymond, who is the minister responsible for finance in the Office of the Prime Minister, yesterday described as “good news” government’s ability to negotiate its latest bonds at a 7.25 percentage rate, a quarter of a percentage point less than the previous set of bonds it issue.

Minister Raymond noted that the 7.25 percent interest rate secured for the new set of bonds was done in an environment where interest rates were growing, therefore to have secured that number showed the confidence of investors in his government and in the economy.

But Pierre dismissed Raymond’s boast, saying that government was able to secure a 7.25 percent interest rate on its bonds simply because “interest rates are doing a particular thing”.

The leader of the Opposition stated that the government can pay the NIC the $100 million it borrowed at the August 26 stipulated date, if the government manages to sell its new set of bonds, however this will not be new money coming to the country, it will just be a transfer, and that the country will get nothing out of this transaction.

Pierre called on Minister Raymond to be open and frank with the citizens of the country by telling them that the country has been running on an increasing deficit.

“When the UWP came into power on June 2016, the deficit on current accounts had been reduced from nearly nine percent when we took it over in 2011 to 3.4 percent. The government always prefers to pretend this does not exist. By their lavish spending they (government) have increased the deficit to nearly seven percent. This means that the government is spending more than it is getting. Without that money they could not retire the bonds,” Pierre said.

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6 comments

  1. The minister's explanation shows the dumbness of the bunching maturity payments one behind the other. This $100 million dollar loan was to cover maturing payments taken 10 and 8 years ago. Which party formed the government in the last 8 to 10 years? Who created the debt the UWP is creating today?

    It is so sad. It is very sad that we are not thinking people. We love to wallow in one roro followed by the next roro. We do not care enough to pay attention to what stupid government is doing to us, to our future and to our children's future.

    We still married to our slave past with a handout, hand-me-down, bread--crumbs -from- the master's table mentality. We firmly mentally enslaved.

    We perpetually vote for the same party or leader, hoping for the arrival of just more breadcrumbs from their tables, as in the past to be continued in the future. We then we blame others for keeping us as "the working poor."

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  3. Brother Pierre, I support your observation 100%.

    It is important "we St Lucians" should know the names of: persons and or companies and or entities. A corrupt and incompetent Prime Minister: somebody will be making a handsome profit on the backs of St Lucians. Ask yourself what is the rate of interest on the international markets?

    The ECCB should be closely monitoring the PM (so called Finance Minister's) activities; all his actions are putting St Lucia economy and livelihood of its people in GREAT DANGER (vieu co-shoun blanc).

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  5. The bondholders are mainly the banks in St. Lucia. Bye bye pensions.It is just a merry go round.

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  7. Not at all surprising that such a posture is taken. After all, being able to borrow more at a lower cost of capital, which is the interest rate negotiated was never a skill on display by anyone in the SLP. What a bunch of losers!

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  9. "Pierre wants to know who are the persons or companies that have brought bonds from the government, lamenting that the names of such persons or entities should not be shrouded in mystery."

    Really Pierre. How about disclosing all your assets to the public.

    (9)(3)

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