Premier and Minister of Finance Honourable Andrew A. Fahie (R1), left, has said his recent visit to the United Kingdom (UK) to meet with officials on the UK Loan Guarantee was ‘a resounding success’ as the discussions were cordial, productive and conducted in an atmosphere of mutual respect and ‘all parties were able to arrive at common ground’. Right is Health Minister Hon Carvin Malone (AL) at the press conference today, September 17, 2019. Photo: VINO

Premier and Minister of Finance Honourable Andrew A. Fahie (R1), left, met with Minister of State at the Foreign and Commonwealth Office, Lord (Tariq M.) Ahmad, right, to discuss the Virgin Islands/United Kingdom relationship and the Loan Guarantee. Photo: Facebook

Premier Andrew A. Fahie (R1), 3rd from left, and his delegation paid a courtesy call on Baroness Scotland (4th from left), Secretary-General of the Commonwealth, at the Commonwealth Secretariat at Marlborough House. Among other things, they discussed climate resilience and sustainable development in small states. Photo: Facebook

“It would be correct to say that we are on our way to signing on to the UK Loan Guarantee and while we are going we making sure that the language is correct so that when we get there we can know if we signing on, but we on our way,” Premier Fahie stated.

According to Premier Fahie, the discussions were cordial, productive and conducted in an atmosphere of mutual respect and “all parties were able to arrive at common ground.”

The territory’s leader explained that the issues that were flagged by the government, and which it has been highlighting over the past several months, fell on fertile ground in London, once the delegation was able to speak directly with the officials of HM Treasury and Lord Ahmad, “who have assured us that it is their wish to see that the people of the BVI benefit in a tangible way from any loans that materialise from this guarantee arrangement.”

Borrowing ratio

One of the major concerns of the VI Government surrounded the borrowing ratios outlined in the Debt Section of the Protocols for Effective Financial Management which, according to Government, did not sufficiently consider the impact of natural disasters and catastrophic events which can place the territory in an unforeseen vulnerable position.

But, according to Premier Fahie, the UK Government stated it is prepared to consider including a reference to natural disasters and catastrophic events in the Debt Section of the Protocols for Effective Financial Management.

“Your government had raised concerns over the treatment the BVI would receive if we exceeded the borrowing ratios contained in the Protocols for Effective Financial Management. This is something all sides have long acknowledged as highly likely, given the current circumstances.”

The UK Government, Premier Fahie stated, said that it is prepared to work with the VI Government on coming back into compliance with the debt ratio if borrowing on the loan guarantee would cause the territory to exceed the ratios.

Concerns with RDA Trust Fund to be considered

Further, Premier Fahie said his government had advocated that the Financial Secretary be able to access the Recovery and Development Act Trust Fund “for the expressed purpose of being able to return any funds borrowed directly by the BVI Government at the request of the relevant lending institution on account of the funds in question not being administered in accordance with that lending institution’s agreed rules and guidelines.”

Hon Fahie said the UK Government has agreed to consider this condition, and the VI Government has been asked to submit some additional information with respect to this issue.

In addition to that, the Government of the Virgin Islands has held the view that not all funds received or funds allocated for all projects must be put into the Recovery and Development Agency (RDA) Trust Fund.

“Your BVI Government has been saying that recovery is one thing and development is another.”

And, according to Premier Fahie, the UK Government agreed to consider the direct administration by the BVI Government of other sources of funds for investment in the recovery besides those borrowed on the loan guarantee to support rebuilding.”

Plan of Action requested by UK

These agreements, Premier Fahie said, pave the way for deliberations to open up and continue on other items that were placed on the agenda by the VI Government.

He said with this new development, Government has been asked to prepare a plan of action to present to the UK Government by September 27, 2019 for moving forward.

To assist this process and later activities, Premier Fahie said the UK Government has opted for the setting up of a special steering committee to enable more direct communication between the Virgin Islands Government and HM Treasury.

“I can also report that our concerns with respect to ambiguous language that was used in some of the documentation, such as the High Level Framework for UK Support for BVI Hurricane Recovery, will be revisited in the best interest of you the people of the Virgin Islands. This includes reference to the divestment of public assets.”

‘A few more hurdles to be crossed’

Premier Fahie said he was relieved that, through these meetings, “with God as our guide”, Government has been able to redirect the focus of this Loan Guarantee matter back to the people of the territory, who he said was glaringly missing from the recovery agenda.

“Your Government is a firm believer that the BVI will never fully recover, unless the people recover. Your Government is a firm believer that the BVI will never be truly resilient, unless the people become resilient. We were able to return the focus on you, the people, by convincing the UK officials that the people of the British Virgin Islands turned a new page on February 25, 2019; that your new government has a different philosophy from that of our predecessors; and that our vision genuinely puts the welfare of the present and future generations of Virgin Islanders first and foremost.”

The Leader of Government Business said a few more hurdles have to be crossed but now there is now a mutual understanding and a clear commitment between both parties to ensure that the people of the VI must be at the forefront and must benefit from any loans accessed through the Loan Guarantee.

8 meetings held with FCO officials in UK

The VI delegation to the UK included Minister for Health and Social Development, Hon Carvin Malone (AL); Permanent Secretary in the Office of the Premier, Mr Kedrick E. Malone; Financial Secretary, Mr Glenroy Forbes; Director of Communications, Mrs Arliene T. Penn; Special Envoy of the Premier, Mr E. Benito Wheatley.

The team while in the UK was joined by Legal Consul/Operations Manager of BVI London Office, Ms Tracy Bradshaw and Senior Political Officer/Cultural Attaché, Ms Siobhan Flax.

According to Premier Fahie, the VI team held a total of eight meetings with officials of the Foreign and Commonwealth Office (FCO), including its Director, Mr Ben Merrick; Ministers of the UK Government – Lord Tariq Ahmad of Wimbledon who is the Minister responsible for Overseas Territories, and Minister James Duddridge from the Department for Exiting the European Union (DEXEU); Baroness Patricia J Scotland, Secretary General of the Commonwealth Secretariat; and officials of Her Majesty’s Treasury.

Governor Augustus J. U. Jaspert attended two of the meetings regarding the loan guarantee conditions.