With Antigua and Barbuda’s debt to GDP set to move from 69 per cent to 100 per cent; and as it becomes more challenging to pay civil servants because of the slowdown in the economy brought about by COVID-19, the government is considering taking on additional debt.
“The truth is, we have to engage in some level of borrowings, even though very sparingly,” Prime Minister Gaston Browne said on the weekend.
“I can see us, for example, maybe borrowing about $150 million to help stimulate the economy.”
Browne made it clear that any loan arrangement entered into by the government would not be to give people cash grants.
Instead, he said the money would be used to stimulate certain sectors , especially agriculture and light manufacturing.
“…to generate construction work so that people can be put to work, even at the national housing programme, so that we can sustain their workers and to make sure too that we can pay public servants,” Browne said.
“Truth be told, it is becoming increasingly difficult for us to pay public servants and we’ll just have to supplement paying public servants and even pensioners.
“Then you have a situation where we have to subsidize various statutory entities to include Social Security. In March we had to give them about $5 million plus. Last month I believe we gave them about $4 million. Even Medical Benefits looking for some level of subsidy now because their revenues would have reduced significantly.
“In addition, St. John’s Development Corporation, they are asking us now for over $400,000 a month so they can pay their workers. So everything comes right back to the central government,” the Prime Minister said.
Singing a different song now