by Linda Straker
- Public debt as of 31 December 2023, was EC$2.155.6 billion or 59.1% of Gross Domestic Product
- 2023 fourth quarter Public Debt Bulletin published on Ministry of Finance’s website
- IMF predicted further decline for 2023
Grenada’s public debt as of 31 December 2023, was EC$2.155.6 billion which, according to data released from the Ministry of Finance, meant that the public debt was 59.1% of the Gross Domestic Product (GDP).
In general, government’s debt increased marginally above the previous quarter by 0.7% and over the same period in 2022 by 3.9% because of disbursements on existing external loans.
“During the 4th quarter of 2022 and fourth quarter of 2023, domestic debt decreased whilst external debt increased. As a percentage of total central government debt, domestic and external debts accounted for 18.8% and 81.2% respectively at the end of 2023,” according to the Public Debt Bulletin which pointed out that government’s debt was EC$0.8 million in the 4th quarter of 2022 and 3rd quarter 2023.
According to the 2023 fourth quarter Public Debt Bulletin was published on the Ministry of Finance’s website on 10 April 2024, the total Central Government debt at the end of 2023 was EC$ 2,155.6 million or 59.1% of Gross Domestic Product.
“There was no government-guaranteed debt at the end of 2023 as the sole state-owned enterprise holding government debt underwent debt restructuring,” said the bulletin which explained that the loan no longer exists.
“Government has restructured the debt of the Marketing and National Importing Board (MNIB) which is the sole State-Owned Enterprise that held government debt in the past year. Payments to the entity’s suppliers were also facilitated. As a result, at the end of the 4th quarter of 2023, there were no Government loans in,” said the bulletin.
In July 2023, the International Monetary Fund (IMF) said that Grenada remains in public debt distress solely due to longstanding unresolved arrears to official bilateral creditors of about US$37.6 million (3.1% of GDP) as of end 2022.
However, at the time, public debt was assessed as sustainable reflecting favourable projected debt dynamics from substantial fiscal surpluses that are supported by the return to fiscal rule in 2023. Because of the Covid-19 pandemic, public debt rose to 71.4% of GDP in 2020 from 58.5% in 2019.
The IMF said then that tourism and offshore education sectors, as well as construction activity rebound, public debt resumed its pre-pandemic downward trend in 2021 and reached an estimated 64.6%of GDP in 2022 and predicted a further decline for 2023.
“Going forward, continued adherence to the fiscal responsibility framework and regularisation of arrears will be needed to maintain a sustainable debt trajectory and upgrade the risk rating. Even though the public debt-to-GDP ratio does not breach its threshold under the baseline scenario, the present value of the external debt-to-GDP ratio and the external debt service-to-revenue ratio marginally breach the thresholds,” said the IMF July 2023 report.
