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HomeThe Big StoriesALBA Bank to write off million-dollar debt, gov’t still taking precautions

ALBA Bank to write off million-dollar debt, gov’t still taking precautions

The Cabinet of Antigua and Barbuda recently announced that, in the transfer of PetroCaribe programme assets to the ALBA Bank in Venezuela — in a bid to further capitalize the bank — the debt owed by Antigua and Barbuda was reduced by 50 percent, following a request made by Prime Minister Gaston Browne.

While the ALBA Bank’s calculation of the Antigua and Barbuda debt differed from the PDV-CARIBE calculation, it was agreed that the reconciliation between the two amounts will be settled in the near future.

Nonetheless, “the principle of halving the debt was agreed-to and implemented” the Cabinet notes stated.

And the debt “forgiveness” to Antigua and Barbuda “resulted in the cancellation of $250,000,000 worth of debt, reducing significantly the amounts that might eventually have to be repaid,” the notes added.

Despite the fact that the debt cancellation in the arrangements between Antigua and Barbuda and PDV-CARIBE, will be seen as a huge financial relief, the Government is being mindful of any future discrepancies.

Minister of Information, Melford Nicholas, shared these sentiments on Thursday, during the weekly post-Cabinet press briefing.

“It is important that book the debt write-off and we ensure that it is properly accounted for because one never knows; the circumstances in Venezuela are fluid and should the government change we want to ensure that there is continuity in that commitment,” the Cabinet spokesperson shared.

He explained that the government is “not anticipating any fallout, but you just never know”.

“And so we would not want to be in a position where down the road our books are not yet tidied up and then somebody says well we are not under that obligation,” Nicholas concluded.

 PDV-CARIBE is a Venezuelan project, which funds social programmes in several Caribbean islands.

It allows for the purchase of petroleum at a fixed rate, and for whatever overage to be accumulated in debt, repayable at less-than market rates.

The amount, which ought to have been paid, is then channeled toward the social programmes — by the governments – for the benefit of the elderly and low-income households.

Hundreds of families have benefitted from the PDV-CARIBE project annually for nearly 10 years.

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