BASSETERRE, ST. KITTS, MARCH 2ND 2014 (CUOPM) – The same British company that assisted St. Kitts and Nevis in its debt restructuring programme three years ago is to give assistance to Grenada as St. Georges announced on Friday that it will not be able to pay as schedule the EC$12 million in retroactive payment to public servants.
London-based White Oak Advisory, which describes itself as an independent financial advisory firm providing specialist, high-level and impartial advice to governments and other clients on matters relating to sovereign finances and sovereign debt, has to been contracted by the Government of Prime Minister Dr. the Right Hon. Keith Mitchell to assist it in its debt-restructuring programme.
A Grenada government statement said that while the process of preparation for payment is almost completed, the Keith Mitchell administration “is mobilizing external funding which has not yet arrived.”
The third installment of the retroactive payment to public officers, teachers, prison officers was due to be made on Friday and the statement said that all unions and welfare associations have been informed of the situation.
“The total cost of this installment of retroactive payment is $12 million. This third installment will bring the total retroactive payment to $30 million with Government having paid $18 million in 2013,” the statement said, adding that an update will be made on March 17 as to when payment would be made.
“The Government of Grenada expresses its appreciation to the unions and their members for their cooperation and understanding on this matter,” the statement added.
Earlier this month, the Grenada government said it was urging trade unions to accept a three-year wage freeze as it seeks to enter into an agreement with the International Monetary Fund (IMF) to deal with an ailing economy.
The IMF had earlier said despite two consecutive financial arrangements with Grenada, totalling more than US$28 million, the island missed the key programme objectives of securing a sustainable fiscal position and a higher growth path.
The IMF said that Grenada during the period 2006-11 had received US$15.2 million in assistance under its Poverty Reduction and Growth Facility (PRGF) arrangement and a successor US$13.3 million Extended Credit Facility (ECF) arrangement that was approved in April 2010.
Late last year, Prime Minister Dr. Keith Mitchell told nationals that while the international community was willing to restructure the island’s debt, the country would have to make sacrifices.
Mitchell, whose New National Party (NNP) came to office in February last year, said Grenada was unable to pay its creditors and was seeking the assistance of the international community to restructure its debt.
Since then there have been several activities aimed at finding a solution to restructuring the debt that is estimated at more than two billion EC dollars.