QUESTIONS KWASI THOMPSON

Feb 26, 2024

February 7, 2024

It is evident that Minister Michael Halkitis is determined to maintain the PLP’s policy of keeping secrets from the Bahamian people.

This PLP government just took on a half billion dollars in new loans that are supported by a policy based IDB guarantee and the Minister’s posture is that the government will get around to tell us the details months and months after the transaction is completed.

He wants us to wait for the third quarter public debt report, when as of February 1st, the second quarter debt report was due and is now late, as unfortunately is typical with all of the legally required budgetary and financing reporting by this administration.

That is wholly unacceptable and it is the complete opposite of the transparency and accountability and this government campaigned on, but regarding which has so far actually moved the country backward.

We do not accept the government’s explanation as to why they cannot reveal the interest rates and terms as their first obligation is to the Bahamian people.

And even if one accepts the weak explanation as to why the interest rates could not be revealed presently, that does not explain why they have not told the Bahamian people what specific policy conditions the government had to agree with the IDB in order to access the loan guarantee. What are the policy commitments that the Bahamian government had to commit the country to? Why is that a secret?

Today the Leader of the Opposition Michael Pintard has tabled a number of questions demanding answers from the Prime Minister on this subject. (Copy enclosed)

The government also must explain why the Financial Secretary and the Governor of the Central Bank appear to be contradicting each other regarding the use of the funds.

Which of these public officials are we to believe is telling the whole truth?

It is a testament to the sad state of Affairs in this PLP government that they cannot be forthright and clear on matters related to the country’s finances.

J. Kwasi Thompson MP LLB

East Grand Bahama

Shadow Minister of Finance

1) Would the Honourable Prime Minister and Minister of Finance confirm that the Government of the Bahamas finalized a foreign loan transaction totaling $500 million during the month of January 2024 that was supported by a policy-based loan guarantee mechanism from the Inter-American Development Bank (IDB)?

2) Would the Honourable Prime Minister and Minister of Finance provide a reasonable explanation as to why the government has withheld the terms and conditions of this loan facility, the documented approved uses of the proceeds and the policy conditions agreed by the government with the IDB in support of this transaction?

3) Would the Honourable Prime Minister and Minister of Finance provide the full terms and conditions of the loan facility, inclusive of interest rates, fees, charges?

4) Would the Honourable Prime Minister and Minister of Finance provide the full details of the approved uses of the proceeds and the restrictions on the use of proceeds as agreed with the lenders, the IDB and any other stakeholder?

5) Would the Honourable Prime Minister and Minister of Finance provide the full listing of all policy commitments made by the government to secure the IDB participation in the transaction?

6) Would the Honourable Prime Minister and Minister of Finance confirm that the proceeds of this $500 million transaction cannot be used for debt refinancing or to roll over debts as stated by the Financial Secretary to the press on January 18,2024?

7) Would the Honourable Prime Minister and Minister of Finance indicate whether any of the proceeds of this $500 million transaction were used to cover any debt refinancing or debt rollover

8) Would the Honourable Prime Minister and Minister of Finance indicate whether any of the proceeds of this $500 million transaction were used to repay any overdraft or line of credit facilities that themselves were used to roll over or refinance any public debt obligations?

9) If the answer to the above question is yes, Would the Honourable Prime Minister and Minister of Finance indicate if the use of the loan proceeds to settle short term debt obligations in this way is consistent with the approved use of the proceeds and is not violation of the IDB loan covenants for these kind of policy-based guarantee facilities?

10) Would the Honourable  Prime Minister and Minister of Finance indicate why the Governor of the Central Bank on January 29, 2024 stated that  in January 2024 the government undertook significant US dollar financing operations (ie borrowing) which were used to pay off bank overdrafts and to help “rollover significant US debt”, while on the other hand, the Financial Secretary has insisted that the only significant US dollar financing operation by the government during the month of January was not used to rollover any US debt?  Would the Honourable Prime Minister and Minister of Finance explain why the nation’s two top public sector officials in the field of public finance would openly contradict each other?

11) Would the Honourable Prime Minister and Minister of Finance indicate the current intended sources of external finances to cover the government’s documented $872.6 million of external debt rollover for the current fiscal year if, as the Financial Secretary has insisted, the $500 million allocation cannot be used for debt rollover and refinancing?   With less than six months left in the fiscal year, would the Honourable Prime Minister and Minister of Finance indicate which loan facilities and financing arrangements will be used to cover the nearly one billion dollars in external financing requirements before end of June 2024

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