Finance Minister Christopher Sinckler has once again deemed comments made by the Leader of the Opposition, Mia Mottley, on the Credit Suisse – Barbados loan agreement as unnecessary, reckless and designed to deliberately damage the impeccable reputation of Barbados in regard to the country’s management of external debt obligations.
???I completely deprecate the insistence of Miss Mottley in deliberately creating the impression in the minds of unsuspecting local and international observers that Barbados has in some way renege on its obligations to international creditors.
???Indeed, what is especially worrisome is that even in the face of irrefutable correspondence from the very creditors themselves, to whom Barbados is indebted, that the country has met all of its obligations on time and as required under the loan contract, the Leader of the Opposition still continues to try to insist that Barbados has done something other than it is legally obligated to do,??? he said.
The Minister added: “It is a shameful display of political belligerence that now leaves one to wonder exactly how far she intends to go in this ???mash-up and build back??? political strategy of hers.”
Mr. Sinckler went on to say that the Leader of the Opposition well knows that no international financial institution or bank under US law, in which the existing loan with Credit Suisse was executed, would be allowed by US authorities to alter the original conditions of any loan contract to the favour or disadvantage of the parties involved, unless such changes are first approved by the sovereign parliament of the borrowing country under the applicable laws.
???Miss Mottley further knows, or perhaps doesn???t, that any material alterations to the official and original terms of any loan contract between a sovereign country and its creditors to the extent that introduces new payment terms or conditions, constitutes a direct default or technical default as so classified by international capital markets and the international rating agencies.
???It is therefore absolutely impossible for any Government of Barbados to surreptitiously alter the original terms and conditions of any loan, so as to permit it to break the original terms and pay less on previously agreed terms, and worse yet, to inveigle a major international bank to accompany it in such mischief, as the arranger of a major syndicated loan involving varied investors,??? Mr. Sinckler contended.
According to him, that assertion not only impugns the reputation of Barbados, but of Credit Suisse, an outstanding and experienced international finance institution. ???It would therefore stand to reason that any benefits which the Government of Barbados has been able to secure under the existing provisions of the loan contract with Credit Suisse must have been provided for in the contract from the very beginning at the point of execution,??? he explained.
The Finance Minister continued: ???In this regard, just as the country was made to pay the higher costs associated with the ratings downgrade penalty clauses in the agreement, so too have we been able to benefit from the positive performance provision clause in the said loan agreement at the request and favourable assessment of the creditor. These clauses were all part of the original agreement that was executed and the Government has not broken any of the contractual terms.
???Therefore, no introduction of any new terms in the loan agreement was required or necessary. Further, as evidenced by the latest Central Bank of Barbados report on the economy, with nearly $1 billion dollars in international reserves, payment of our external obligations was never in question, then or now.???
The Minister concluded by saying that if Miss Mottley was genuinely interested in ascertaining any official information about the loan and our obligations there under, she was free to ask the appropriate Parliamentary question in the House of Assembly to which ???I, as Minister, would have been obliged to provide the relevant facts and/or clarifications???.
“Instead the Leader of the Opposition once again chose the low road of baseless allegations, political intrigue, and a shoot first ask questions later method calculated to do maximum damage to the country, Mr. Sinckler said.”