Antigua and Barbuda declines loan offer from African Ex-Im Bank

Antigua and Barbuda will not pursue any loan arrangements with the African
Export-Import Bank as its interest rates are ‘too high’.
The disclosure was made in parliament on Monday by Prime Minister Gaston
Browne, who said the government took the decision as it was in the best interest of
the people of Antigua and Barbuda.
“One of the things about this administration is that we are very nimble; almost
invariably we are ‘first-movers’ within the Caribbean on practically every issue.
When the African Ex-Im Bank engaged the Caribbean about two years ago-, we
signed on to explore the possibility of doing business with them,” he reported.
However, PM Browne relayed that during the negotiations the government
discovered that what the bank called ‘concessionary rates’ were not what it
considered to be concessionary.
“We commenced negotiations with the African Ex-Im Bank to secure a loan of
US$100 million on behalf of the Antigua and Barbuda Airport Authority to do
major upgrades at expansion at the VC Bird International Airport. During the
negotiations, the terms they offered us were; a concessional interest rate of 12
percent and a 4 percent negotiations fee. I am told that companies such as Air
Peace borrow at up to 25 percent interest rate. However, I must tell you that the
African Ex-Im Bank interest rate model does not work for us. Therefore we had to
decline going any further in the discussion,” PM Browne emphasized.
He also revealed that the government has turned to a consortium involving
Oppenheimer (Investment bankers) and FCIB to do the loan and that negotiations
are nearing conclusion. The interest rate will not exceed eight percent with the
negotiations fees at about two percent.
“This is how responsible we have been as a government. We also shop for ‘best
value’ for the people of Antigua and Barbuda,” he stated.