Gov't facing loss with £300M UK loan guarantee- Ray A. George
Declining value of Pounds
Noting that the pound is now at an all-time low on the Tuesday, September 17, 2019, edition of 'Honestly Speaking' with host Claude O. Skelton-Cline, Mr Gerge said that the Hon Andrew A. Fahie (R1) administration is now battling with a loss since £300M in 2017, is now less in 2018 when converted to USD.
"The loan guarantee was in pounds, now it was £300M at the time, November 30 [2017], that would have put us at USD $405,840,000, that would have been the guarantee at the time," he told host Skelton-Cline and the listening audience.
However, he said that due to the complexities of Brexit and the falling value of the British currency, "as of September 12, 2019... we are battling with a loss... it is now USD $369,810,000," he said.
"The pound is at an all-time low, with Brexit it dropped almost 10% in one day. We don't expect it to go any higher... so I'm predicting that if there's a 5% fall, let's say October 31," he said more losses will come.
Lock in Rates - Mr Geroge
He noted that what should have happened, was that if the territory indeed takes the loan guarantee, the administration should lock into a rate at that particular time.
"They have to be some kind of agreement that says look, this is guaranteed now, let's lock into this rate or agree on some future rate," he said.
Noting that it is a concern, he said, the money should have even been taken in USD to get the best value for the people so the value wouldn't change.
"I'm very concerned in that situation, how that would work out," Mr Geroge said. Virgin Islands News Online (VINO) reached out to Premier and Minister of Finance Hon Fahie for a comment, however, no reply was received up to publication time.
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