Press Release

Basseterre, St Kitts: 1st June 2011

The Government of St Kitts and Nevis announced today that it is to seek the cooperation of its creditors in the restructuring of its public debt stock, which is approximately US$1 billion. This exercise will address the severe payment challenges associated with servicing this debt and will seek to place the country’s high debt burden firmly on a sustainable footing along with a series of economic measures being introduced by the authorities.
 
At almost 200% of GDP, the public debt burden of St Kitts and Nevis is amongst the highest Debt to GDP Ratio in the world, and it is expected that the majority of this debt will be affected by the restructuring. Treasury bills, however, will be excluded from this exercise and Treasury Bill holders have been assured that their investments will not be affected.
 
As a small, tourism-dependent economy, St Kitts and Nevis has been severely affected by the global financial crisis. Sharp declines in tourism revenue and Foreign Direct Investment dependent activities triggered a contraction in government revenue, and a deep, economy-wide recession in 2009-2010. These adverse economic conditions contributed to a further deterioration of the country’s public debt levels in 2010.
 
“Over the last 12 months, the Government has responded to a very difficult external environment by introducing a series of corrective measures designed to stabilise the public finances”, said Prime Minister and Minister of Finance, the Hon Dr Denzil L Douglas. “We will soon be unveiling a set of comprehensive reforms aimed at improving our medium-term outlook, but it has become clear to us that the magnitude of our debt burden is such that reforms alone cannot restore long-term sustainability to our public finances. We must therefore now work closely with our creditors to identify and implement credible and definitive solutions to our debt difficulties with their support.”
 
The Government of St. Kitts and Nevis has appointed White Oak Advisory to act as its financial advisor in its consultations with affected creditors. These consultations will begin immediately. Clifford Chance will be acting as legal advisor to the authorities.
 
Information on the debt restructuring process will be posted periodically on the website of the Ministry of Finance, which can be accessed using the following link: http://sknmof.com/creditors.htm
 
Creditors may also contact the Government’s financial advisors at   skn@whiteoakadvisory.com 
 
 

2 Responses to “ST KITTS AND NEVIS TO SEEK THE SUPPORT OF ITS CREDITORS IN DEBT RESTRUCTURING”

1. A Kittivisian
   June 4th, 2011 @ 10:41 am

   What happened to “Progress not Promises”? Did anyone else notice the admission that all the time he was claiming “e ah wuk!” he was “harassing” the IMF for help!?

   Wake up People of St. Kitts-Nevis! This is just the start! Where are all those people who took free trips to come back and vote? Why don’t they come back and face the music! Come back and put something in the treasury with the VAT and 100% hike in Electricity!

   Come back and help us clear down the National Debt! Is dat you voted for come back and feel the heat!

2. CaribbeanMan
   June 4th, 2011 @ 10:56 am

   Bwoy A National, you on de ball man!

   It wasn’t working then and e nah wukking now! I want to know what the hell the man from the IMF was chatting about! “The private sector must take the lead…” How? The private sector is The Buffalo Soldier – Fighting for survival!

   You got to pay VAT to the treasury regardless of whether the invoice has been paid! Electricity doubled! Government doesn’t have any money and can’t borrow, yet they have donor money for projects that they won’t spend with the same private sector and sending it back to Europe!

   Pure LUNACY! Someone needs to be flogged in the square!

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