The PACT coalition government has reported that it has inherited government finances in generally good shape, particularly up to the first three months of the year.
Speaking during the new administration’s first press conference since taking office on April 21st, Hon. Minister of Finance Chris Saunders revealed that Government is doing better in 2021 than in 2020 with respect to Surplus results for the Entire Public Sector.
He explained that combining the Government’s surplus of $196.2 million with a $6.4 million net surplus from Statutory Authorities & Government-owned Companies (SAGCs), the Entire Public Sector (EPS), had a Surplus of $202.6 million to 31 March 2021 which was $43.1m better than budget and $25.4m better than 2020.
Mr Saunders said the government’s Debt-to-GDP ratio is a very favourable 5.1% - amongst the lowest in the world.
He affirmed that the PACT administration will refrain from borrowing for as long as possible but said this may become necessary if the borders remain closed and the economy is not operating at its full potential.
He assured that there will be no cuts in domestic spending and the government will be looking at ways to encourage funds to remain in the domestic economy.
The Minister for Finance and Economic Development and Labour said motivating more people to support local farmers and being more energy-efficient would help to reduce the amount of money spent overseas to buy agricultural and fuel products.
However, Mr Saunders pointed out that stability in the government’s finances is not necessarily an absolute reflection of how well the economy might be doing.
He estimates that the economy might have contracted by between CI$600 million to CI$1 billion due to the pandemic.