EC$54.6 million in Grenada’s CBI contingency or buffer fund at ECCB

by Linda Straker

• Previously, by law, 40% must go into contingency fund; reduced to 10% from 2022
• EC$54.6 million reflects 10% Government’s deposit from monthly inflow earned through NTF
• Fund shall not be used for lending of money to Government of Grenada, any state-owned enterprise or any statutory body

Grenada has EC$54.6 million in its contingency fund at the Eastern Caribbean Central Bank (ECCB). That fund reflects Government’s deposit of 10% from the monthly inflow of revenue earned through the National Transformation Fund (NTF) of the Citizenship by Investment (CBI) programme.

Richard Duncan, Chairman of the Citizenship by Investment Unit, said that since 2023, the Government began putting aside real money into a contingency fund, which is a requirement of Section 45 (2) of the Public Finance Management Act, No. 17 of 2015. “Previously, the law said 40% must go into that contingency fund; not a black cent went in and that is since 2014. From 2022, it was reduced to 10%, and it has been lodged at the ECCB to the aggregated total now of EC$54.6 million,” Duncan said in an interview on the weekly Sunday “The Bubb Report” — a podcast where current affairs issues are discussed and debated. “It’s a buffer fun; even Hurricane Beryl was not a sufficient disruption to draw down on that money, it has to be a major economic shock,” he said.

The revenue to Government for the year 2024 through the CBI programme was EC$472,981,142 according to the recent data release by the Investment Migration Agency (IMA) – the agency responsible for administering the CBI programme.

According to the NTF regulation, that fund is managed by a Board of Directors and the money in it can be used to meet the obligation under regulation 9 which states, “In every financial year, the board shall allocate the first $24 million of payments into the fund to the Consolidated Fund for the sole purpose of payment of budget expenditure arrears.”

The Contingency Fund can also be used to reduce budget expenditure arrears; to meet the objective of the fund to restructure, repay or repurchase debt; or to provide relief from a national disaster.

Section 13 of the NTF regulations states that the fund shall not be used for the borrowing or taking on of any contingent liability in the form of a guarantee or otherwise. “The fund shall not be used for the lending of money to the Government of Grenada, any State-Owned Enterprise or any Statutory Body.”