BASSETERRE: Prime Minister and Minister for Finance of St Kitts & Nevis, Dr. Denzil Douglas, has announced that following an extensive debt restructuring process, the two-island federation’s debt burden has been reduced from 156 per cent to 131 per cent of gross domestic product (GDP).
Dr. Douglas made his announcement during a recent Cabinet meeting where he also disclosed that the federation’s debt ratio would likely fall into double figures in the near term as a result of on-going budget consolidation efforts.
If St. Kitts & Nevis debt to GDP ratio falls below 100 per cent, it would be a significant milestone for the Douglas administration. In 2009, St Kitts & Nevis had a public debt at 185 per cent of GDP, the third largest in the world as a percentage of the economy.
The government’s success can be attributed to the introduction of a value-added tax and excise tax reforms in November 2010, the streamlining of import duty exemptions and the introduction of an environmental levy. Furthermore, the International Monetary Fund has consistently reported that St. Kitts & Nevis is making significant strides towards fiscal consolidation under a 36-month financial assistance program.
Following the Cabinet meeting, Minister of Information, Nigel Carty, lauded the “herculean effort that has been exerted to bring great relief to the country’s fiscal position at such an economically challenging time”.