Fiscal deficit reduction hindered by delays
THE sale of the Hilton Barbados and the Barbados National Terminal Company Limited (BNTCL) would have led to a two per cent reduction in this island’s fiscal deficit.
So stated Minister of Finance and Economic Affairs, Christopher Sinckler, as he spoke on the delays of the sale of the two entities while starting the debate on the Appropriations Bill yesterday in the Lower House.
Speaking on the Fair Trading Commission’s ruling against the BNTCL sale due to its issue with the system regarding the market structure of the purchase and resale of fuel in the island, and its subsequent ruling that the parties revise such, the minister said that the parties are soon to file an amended position.
“Of course, we would have been glad to have received those funds because part of that suggested or projected sales price of $100 million would have gone into the Central Bank reserves and would have given a boost to our international reserves and insulated us from the declines, which we felt in the latter part of this year; and some of the proceeds from the sale of the asset, once the dividend was declared, would have come into Government’s coffers and allowed the Government to have some additional income in terms of asset income to the central government, but it didn’t happen,” he stated.
Regarding the sale of the Hilton, Sinckler said its delays were not caused by regulatory intervention but because of the process that has to take place “to get to that eventual sale”.
“If we had those two sales and we had the liabilities management exercise, we would have ended up with more than $250 million additional in revenue, which if we added it to what we have relative to these Estimates, revised as I have indicated based on what we would have done in the Budget, we would have been able to reduce our fiscal deficit by at least another two per cent,” he remarked.
“In relation to that, we can see Government continues to make substantial progress in bringing its fiscal deficit down,” he added. (JMB)