Antigua and Barbuda’s main opposition United Progressive Party (UPP) has accused the Gaston Browne administration of providing “great expectations” after it was forced to cancel a US$200 million bond it issued on the international market earlier this year.
The government in February had said the bond had been fully subscribed and provides “an incredible opportunity for the government to re-profile its debt”.
Prime Minister Gaston Browne, delivering the EC$1.64 billion (One EC dollar=US$0.37 cents) budget to Parliament in February, said the bond with a ten-year, 4.5 percent instrument registered on Euroclear, “is the first and largest bond of its kind issued by Antigua and Barbuda, and it has been fully subscribed.
“This financing provides an incredible opportunity for the government to re-profile its debt, to ensure sustainability going forward, and to invest in strategic projects that will drive economic growth, create employment, and generate increased revenue to finance government operations.”
But Browne, speaking this week acknowledged that the bond had been canceled as he answered opposition questions on the matter.
“We had an entity that subscribed to the bond and so far, they have not paid the funds and we have given instructions to cancel the offer,” Browne told legislators as the Opposition Leader, Jamale L. Pringle, urged him to confirm the bond offer of US$200 million had indeed been canceled.
“Mr. Speaker it is likely that we may do so and re-issue it (but) instructions have been given to cancel it,” Browne told legislators.
Browne said in February that the bond would also have been used for the acquisition and renovation of the Jolly Beach Hotel and “ensure payment of severance due to the Jolly Beach workers upon successful acquisition of the property”. He said the funds will also be used to construct a hotel at Morris Bay.
But the UPP said as a result of the cancellation, the government gave Antigua and Barbudans unrealistic expectations, noting that even after the announcement of the cancellation, a senior government minister was still informing the nation that the bonds would be available.
“They gave the public false hope. To the pensioners, they expected this money would have helped …all of the workers who were owed, backpay, etc., thought that this would help the government settle the arrears and everybody waiting on some little assistance,” said UPP spokesman Damani Tabor.
He told a radio program the hopes of the workers had been dashed “and now we hear that a single person or company that had expressed interest changed their mind and so the bond issue has failed”.
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He questioned how the bond could have failed when the government made it clear at the start that it had been oversubscribed.
“But how could it have been just a single person, the term the government used is oversubscribed and for bonds to be oversubscribed it means you have multiple people coming to you and saying …the offer is so sweet take my money, not one person”.
The UPP claimed that the government’s poor record on financial accountability is behind the reason for the cancellation of the bond.
“If we did not put this to Gaston Browne during the questions to ministers, the public would not have known and it is shameful,” Tabor said.
CMC