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‘No time for bickering & confusion’- Premier on UK Loan Guarantee

- Calls on Governor Jaspert to solidify UK commitments in ‘Black & White’
Premier and Minister of Finance Honourable Andrew A. Fahie (R1) addressing the audience at the Eileene L. Parsons Auditorium on August 20, 2019 in what was a first of a series of public consultations on the United UK Loan Guarantee conundrum facing the territory. Photo: VINO
Well over a hundred persons attended the consultation meeting on the United Kingdom Loan Guarantee at the Eileene L. Parsons Auditorium on August 20, 2019. Photo: VINO
Well over a hundred persons attended the consultation meeting on the United Kingdom Loan Guarantee at the Eileene L. Parsons Auditorium on August 20, 2019. Photo: VINO
Following some disagreements regarding the interpretation of the conditions surrounding the guarantee by both the Premier Andrew A. Fahie and the unelected Governor, Augustus J. U. Jaspert, Hon Fahie said the crux of the matter is not about who is right, but rather, ‘what is right for the people of the Virgin Islands.” Photo: VINO/File
Following some disagreements regarding the interpretation of the conditions surrounding the guarantee by both the Premier Andrew A. Fahie and the unelected Governor, Augustus J. U. Jaspert, Hon Fahie said the crux of the matter is not about who is right, but rather, ‘what is right for the people of the Virgin Islands.” Photo: VINO/File
PARAQUITA BAY, Tortola, VI – In the first of a series of public consultations on the United Kingdom (UK) £300M Loan Guarantee conundrum facing the territory, Virgin Islands (VI) Premier and Minister of Finance Hon Andrew A. Fahie (R1) has called on the UK government to solidify any verbal commitments made that will address conflicts surrounding stipulations of the Guarantee.

The Premier was at the time addressing the public in the Eileene L. Parsons Auditorium at the H. Lavity Stoutt Community College (HLSCC) in Paraquita Bay, Tortola, in a meeting that was broadcasted on both television and radio, in addition to social media on August 20, 2019.

Following some disagreements regarding the interpretation of the conditions surrounding the guarantee by both the Premier and the United Kingdom appointed Governor, Augustus J. U. Jaspert, Hon Fahie said the crux of the matter is not about who is right, but rather, ‘what is right for the people of the Virgin Islands.”

Decisions to Make

Premier Fahie said that since the handling of the issue and its outcome will have an impact on the people of this territory in the immediate term and for generations to come, it is one that he takes seriously.

Warning of deep consequences, he said the decision to move forward or not with the loan guarantee will not be a simple one, “And we need to have one mind as one people when we sign on to these commitments.” 

Premier Fahie continued, “Now is not the time for bickering and confusion, because whether we choose to rebuild our country quickly with loans or to take out time and move at a pace that we can afford… It is we the people of the Virgin Islands who is going to have to live with the consequences.”

He said the quick fix action of taking the loan comes at a high price, however, the safer option to use the territory's finances requires sacrifice. Further, he illustrated that unless a third option comes, the opportunity cost of one decision over the other will persist.

He also moved to remind the audience of that with the UK’s loan guarantee for up to £300M, certain conditions must be met as laid out not only in the Virgin Islands Recovery and Development Agency (RDA) legislation but in the High-level UK Framework for BVI Hurricane Recovery Support.

New Economic Reality

In addressing one of the ambiguities surrounding the Loan Guarantee, the Leader of Government Business pointed out that the Protocol for Effective Financial Management signed between the National Democratic Party (NDP) Government and the UK in 2012, stipulates certain financial indicators that must be maintained.

The Protocols, based on revenues, expenditure, debt and debt servicing were signed before the 2017 Hurricanes, therefore, according to the Premier, it is only fair that certain ratios have to be readjusted to take into account the VI’s economic reality—post-Irma and Maria—given the territory’s lowered earning capacity.

“Unless these ratios are adjusted, or suspended, the Virgin Islands runs the risk of exceeding the levels set and being accused of defaulting on the terms of the [Loan] Guarantee. In addition, the Virgin Islands would be accused of defaulting on the conditions that was set out in the Protocols for Effective Financial Management.”

He said no indication has been given in writing to date, that conditions would be relaxed. Through a recovery and reconstruction package for the Virgin Islands (VI) the UK proposed £300 million in loan guarantees and £10 million in grants to support the territory's recovery after hurricanes Irma and Maria devastated the VI in September 2017.

No Blame Games

Turning his attention to what got the territory into such strict financial oversight in the first place, the Premier said he will not play blame games relating to the previous government or any other governments of the past.

He, however, said that National Democratic Party (NDP) infractions such as no audited financial statements for several years, no disclosure of contracts by elected members of the House of Assembly (HoA) as well as poor accounting for major projects are contributors to the VI’s current situation.

“These things did open the door for the UK to put the Virgin Islands on a very short leash and to be assigned baby sitter agencies like the Recovery and Development Agency.“

The Premier noted that if the VI agrees to the loan guarantee and the loans, the VIP administration has a mission to make sure that the conditions are favourable, to prevent fiscal deficiency.

Premier Fahie thanked Governor Jaspert for a verbal commitment on behalf of the UK government to address the issues, however, he reiterated that it must be in writing.

5 Responses to “‘No time for bickering & confusion’- Premier on UK Loan Guarantee”

  • concern (21/08/2019, 07:29) Like (7) Dislike (0) Reply
    After the meeting at HLSCC last night I am very concerned
    • @ concern (21/08/2019, 08:38) Like (15) Dislike (15) Reply
      me too as its time we discuss independence...WE WITH FAHIE AS HE WITH THE PEOPLE
    • Yes Be Concerned (21/08/2019, 16:53) Like (2) Dislike (0) Reply

      The UK isn't taking over managing government. The RDA only deals with money that we receive for fixing back the territory. It has nothing to do with the running of government. 

  • SlowandSafe!!!! (21/08/2019, 11:03) Like (4) Dislike (1) Reply
    We have always been a people willing to take our time, build out of our own pockets no matter how long it takes!!!!!
  • my 2 cents (21/08/2019, 18:51) Like (1) Dislike (1) Reply
    The uk up to their old tricks again


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