Eustace wants answers about EC$40 million gov’t bond

Opposition Leader Arnhim Eustace (File photo).

KINGSTOWN, St. Vincent – The response to an EC$40 million government bond last month suggests a lack of confidence in this country’s financial situation, Opposition Leader Arnhim Eustace said Monday.

The EC$285,000 oversubscription, according to Eustace, was “a signal that things are declining, not improving.

“… we must tell the public the truth on these matters,” the former minister of finance said.

He suggested that he would ask when Parliament meets on May 31 for answers about who bought the bonds.

The Ministry of Finance said the government’s 10-year bond issue, auctioned April 27 on the Regional Government Securities Market using the primary market platform of the Eastern Caribbean Securities Exchange, was oversubscribed by EC$285,000.

A competitive uniform price auction methodology was used and the closing rate was 7.5 per cent. Three licensed intermediaries placed 20 bids, ranging from EC$10,000 to EC$10 million with an aggregate value of EC $40,285,000, the Ministry said.

But Eustace, an economist, said that while the bond was “technically” oversubscribed by EC$285,000, it is not something that the government should brag about.

“… I won’t describe that as oversubscribed because that is less than one per cent over the amount of money you are looking for,” he said during his weekly radio appearance.

“So, you just barely went over the mark,” he further stated.

“… I want to know who took up the bonds. … Did the business that is issuing the bonds take any? If so, how much did they take?”

Eustace also wants to know how much of the bond was bought by local and foreign entities.

“I want … Prime Minister [Dr. Ralph Gonsalves] to tell the nation that,” he said, adding, “… Technically, it is [oversubscribed] but it does not mean anything significant. It means that things are tightening for us also.”

He said the response to the bond was not bragging rights but was “something to examine and see what we can do to improve our financial performance so that when you put out a bond issue … people will come to buy it and you will have more people buying than you need”.

Eustace made the point as he also spoke of St. Kitts and Nevis’ inability recently to pay its bonds issue.

He said the situation in the fellow Eastern Caribbean Currency Union economy and local financial circumstances have implication for investor confidence in the sub-regional bloc, the Organisation of Eastern Caribbean States (OECS).

“I raise these issues because as the financial situation in any of our countries deteriorates, we have to look at the impact that is going to have on investor confidence … in the OECS as a whole and what does it mean for our currency in the future, for the value of the E.C. (Eastern Caribbean) Dollar.

“These are very, very serious questions. … We have too many deficits and too large a deficit. And I am saying to the people of St. Vincent and the Grenadine this morning, I don’t like it and I want more information so I can set your mind at ease not only in the case of the St. Vincent bond but in the case of the other OECS countries.

“… We need to come clean and clear with the people of this region as to exactly where we are and what steps we are taking to correct it. And that’s a major concern of mine,” Eustace said.

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9 thoughts on “Eustace wants answers about EC$40 million gov’t bond

  1. Funny, Mr. Eustace wants answers on bonds that were put on the market eh? I am sure that this was transparent! Why Sir, isn’t it transparent enough? ok! tell us about the money that you and your parliamentarians are receiving for constituent office and other monies allocated for other purposes, tell us Sir, way all the money garn?

    Posted by Caddy King | May 8, 2012, 10:08
    • Yea Canddy King . What about the millions of US dollars deposited by the PM’s family and ULP party supporters? What about the hundreds of thousands the PM ah tek fo special projects. What happen to that? What about the money the ULP thieves tek from agriculture, health and the airport?

      But Really what does money for party office has to do with the issue at hand? You people talk so much “tootoo” one must conclude that all’yo had to be living in a political toilet

      Posted by AHA | May 14, 2012, 11:47
  2. Good, Caddy. You INCLUDE the ULP CONSTITUENCY OFFICES, too ?
    Yea, great. Time enough, for all monies sidelined from the consolidated fund, also.
    Then, again, all CONSOLIDATED FUNDS allocations that have been challenged and questioned in PARLIAMENT, and in the intimidated PRESS or ELECTRONIC MEDIA.
    For, starters, TOO, how about that INFAMOUS ONE MILLION US DOLLARS [US $ 1,000,000.].
    What of the multiple millions dollars party contribution in the REFERENDUM ?
    THANK YOU, Caddy King, Vincentian patriot, for daring to put forward such a great suggestion : CLEAN UP ALL THE CORRUPTION, WHERE-EVER IT MAY EXIST.
    Let all Vincentians back this laudable effort to forensically hunt down all the political bobol, chicanery, graft, and corruption in this formerly blessed land of ours.
    I have some further suggestions as to the level and quality of investigations and, or, investigators, the extent of investigations, the length of time to be covered, etc., AS A MOST CONCERNED VINCENTIAN — in case you wish.
    DOWN WITH ALL SVG CORRUPTION. Support our brethren Caddy King.

    Posted by STEVE_ HUGGINS | May 8, 2012, 11:27
  3. Yes Steve, We will see where all the falsehood, lies, and mis-appropriating of fun exist! you know, a long time ago I use to watch this show starring Robert Wagner: It takes a thief, his father told him once, son, I have heard of people stealing from the Government, but stealing for the Government? so I ask you and the NDP which ones are you? I can’t wait to find out! let the chips fall where they may, let us see who will regret this! IT’S CALLED TRANSPARENCY MY BROTHER!!!

    Posted by Caddy King | May 8, 2012, 13:52
    • Caddy, why don’t they tell us about the $200 000 000 + that was wasted at Ottley Hall? Then we could discuss other moneys that they are talking about!!!!!

      Posted by no-nonsense | June 1, 2012, 20:02
      • they got debt forgiveness,so there’s nothing to talk about,own de bankruptcy ulp people ,there’s less and less money to go around pretty soon you’ll have to tatoo “I am a labour supporter” on your behinds and do certain things just to get the usual party supporter moneys/kickbacks,oh you labour clowns too bad the circus is getting shut down,this has been the funniest government in the history of svg

        Posted by Jahu | June 3, 2012, 02:32
  4. One particular rich cat retired Lawyer has been a regular buyer of SVG Bonds and Treasury Bills, he has become stinking rich on the back of these issues and has a close association with the ULP hierarchy.

    In the past when these instruments have been undersubscribed the NIS have secretly stepped in and bought in, to make the SVG instruments appear to be much sort after, thus encouraging others to subscribe and increase investor confidence.

    Eustace if you don’t get the right answers notify the RGSM that you are investigating possible irregularities and demand the information from them.

    We have so many bonds and bills issued that we will sooner or later go pop.

    Posted by PETER | May 8, 2012, 21:46
  5. CADDY KING, you need to see a psychiatrist or a priest or some who can sort out your path, somewhere you have taken the wrong turn and do not see things the way they are.

    Brother you are supporting evil, Marxism, of course unless that is what you truly believe in.

    Posted by PETER | May 9, 2012, 06:25
  6. if it’s national properties then it’s a good thing,they need to stop wasting moneys on play play projects and invest hard cash bac into svg,if only to help pay workers..Gonsalves talks about the airport as if building an airport would result in the second coming of Christ,

    Posted by Joe | May 10, 2012, 01:56

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