Prime MInister of Antigua and Barbuda Gaston Browne (File photo)

Antigua Gov’t promises no mass lay-offs should it accept IMF multimillion-dollar loan

Prime MInister of Antigua and Barbuda Gaston Browne (File photo)

The Antigua and Barbuda Government says it does not anticipate any mass dismissal from the public service should the island acquire a loan of more than US$100 million from the International Monetary Fund (IMF) to help shore up its economy as a result of the impact of the coronavirus (COVID-19) pandemic.

Prime Minister Gaston Browne, responding to a question from Opposition Leader Jamal Pringle, also hinted that St John’s would be better off acquiring a US$50-million loan from the Barbados-based Caribbean Development Bank (CDB).

Antigua and Barbuda’s Opposition Leader Jamale Pringle propsed that the Government apply for a US$50-million loan from the Caribbean Development Bank. (Photo: Antigua Observer)

Earlier this month, Prime Minister Browne confirmed that his Administration is holding talks with the IMF as the island explores its options in the event that it should require funding to deal with the impact of the COVID-19 pandemic.

Browne said, however, that his Administration has already made it clear to the Washington-based financial institution that St. John’s would want to introduce “our own home-grown programme, but to get their funding just in case we end up in a situation in which everything comes to a halt because of the protracted situation with COVID”.

In the Parliament on Tuesday, Prime Minister Browne said no decision has been taken regarding the IMF, indicating, however, that the terms will be concessionary and would not require the dismissal of a large number of public servants.

The Government of Antigua and Barbuda has engaged the International Monetary Fund in Washington, DC, USA, in discussion to assist the Eastern Caribbean country dealing with the economic strain caused by the coronavirus pandemic. (File photo)

“The answer is a resounding no. In fact, the preliminary discussions we have had is such that they have accepted all of the conditions of our medium-term strategy, but in any case we do not believe that we should be incurring an additional US$110 million in debt.

“Already, we have [gone] before the CDB board a facility for US$50 million and we believe Mr Speaker that the US$50 million from the CDB would provide the necessary budgetary support during this very critical period, thereby negating the need for additional IMF borrowings,” Browne told legislators.

He said that if the Government is to avail itself of that facility, “it will be possibly over a period of about 10 years with a four-year moratorium on the principle pay and interest rate will be approximately one per cent.

“However, the Cabinet has to date not taken any decision to avail itself of that facility,” Browne added.

Last month, the Government said it had established a Cabinet subcommittee to help source funding as the two-island State continues to be seriously impacted by the pandemic.

A government statement said that the virus “has had a terrible impact on revenue, reducing the same by more than 40 per cent”.

According to the statement, “many borrowing sources have been fully exhausted, locally, and moratoria granted by local banks to the Government will soon come to an end.”