Prime Minister Gaston Browne of Antigua and Barbuda says the government would not be pursuing any loan arrangements with the African Export-Import Bank due to the high interest rates offered.
The decision was made in the best interest of the people of Antigua and Barbuda. The Prime Minister explained that his administration is known for being quick to act on various issues within the Caribbean.
When the African Ex-Im Bank approached the Caribbean two years ago, Antigua and Barbuda signed on to explore the possibility of doing business with them. However, during the negotiations, the government discovered that the bank’s “concessionary rates” were not as favorable as expected.
However, during the negotiations, the government discovered that the bank’s “concessionary rates” were not as favorable as expected.
The government had been in talks with the African Ex-Im Bank to secure a loan of US$100 million on behalf of the Antigua and Barbuda Airport Authority to fund major upgrades and expansion at the VC Bird International Airport.
However, the terms offered by the bank were a concessional interest rate of 12 percent and a 4 percent negotiations fee, which the government deemed too high. In comparison, companies such as Air Peace borrow at up to 25 percent interest rate.
The African Ex-Im Bank’s interest rate model did not work for Antigua and Barbuda, and as a result, the government declined to move forward with the discussions. Instead, the government has turned to a consortium involving Oppenheimer (Investment bankers) and FCIB to do the loan, and negotiations are nearing conclusion.
The negotiation fees will be around two percent and the interest rate will not exceed eight percent. Prime Minister Browne emphasized that his government always seeks the “best value” for the people of Antigua.