Archer gets back $6M interest

| 18/01/2014

CNS): The ministry of finance has managed to reduce government’s interest on the lifetime of its loans by more than $6 million by renegotiating the loans it currently has with the lenders. Government officials said that these “efforts and strategies implemented” will save the public purse some CI$6.2 million in interest costs over the next ten years. The ministry has negotiated lower fixed term interest rates for five of government's existing loans held with a local commercial bank that totalled CI$88.4 million as at 30 November 2013. The new and lower fixed term interest rates range from 1.25% to 2.71% per annum, down from levels of 2.82% to 4.25% annually for the preceding five years of 2008–2013.

The interest rates are now fixed for the remaining life ofeach of the five loans.

"The government is very pleased with the negotiations and the achievements of the ministry in meeting the goals and objectives of the government to be fiscally prudent and reduce expenditure,” Finance and Economic Development Minister Marco Archer said. “For fiscal year 2013/14, CI$0.6 million in interest cost savings will be realized and will have a positive impact on the 2013/2014 budget surplus and debt service ratios, while building public trust and confidence in the government’s fiscal performance."

Archer had promised to renegotiate all of government’s debt in an effort to reduce its annual interest payments, which are in excess of $30 million. The previous administration had also made efforts to do so by trying to move the loans with new closed door deals. However, there were concerns raised about those efforts, ultimately costing the public purse as a result of penalty clauses. By negotiating with the existing lenders, Archer has managed to avoid penalties and the cost of re-tendering.

However, this renegotiation only represents a fraction of governments existing debt, which is in excess of half a billion dollars.

Category: Politics

Comments (58)

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  1. Anonymous says:

    I can't be broke! I have cheques left!!

    – Anonymous quote.

    The news we're receiving, about "economic recovery" here and there has been designed to entice us into spending (and borrowing) again after we became somewhat leary watching our economies being pillaged by financial institutions. Don't be surprised if it happens again. And again. Followed by further "recoveries". It's a game.

  2. Anonymous says:

    Big difference when we have someone with financial expertise and sound ethical principles. 

  3. Anonymous says:

    I am so glad to know God has  finally put in place a level headed Caymanian at the wheel in Finance. May God bless you and your family. May his divine guidance be with you now and forever more. Marco, please while you are at the extortioners, please liaise with some of the Banks to also give their customers justice. Some poor Caymanians are going to loose their homes in the near future just because of greed and injustice. It cannot be right what they are doing to people lives.  It is a crying shame, sometime last year a relative of mind had to get a Bank on Cardinal Avenue to rewrite his mortgage because the divorce criminal lawyers left him with only his house which he had a mortgage on, all his assets which he burst his backside for before the marriage went to Princess Never Put a Dime In, plus land and earnings. After rewriting the mortgage, and coming to an agreed figure, he realised 2 months later that the Bank was also withdrawing a further $900 for insurance from his salary. Please tell all that are hurting from these thiefing banks who to live when more than 3/4 of their salary is deducted for mortgage/insurance. How do we live, what do we do with CUC $1,000 per month light bill. Do we decent hard working Caymanian have to stoop low and join the band wagon and surpress Government as some status holders do to pay our rent and light bills? Now my relative has put his house on the market for sale, and further plans to leave his homeland to seek a better living abroad, away from his family. Sad, Sad! Something has to be done on the extortion in this country.  In Ezekiel 22 V 12 God says "You have taken gifts to shed blood,you have taken usuary and increase and greedily gained from thy neighbour by Extortion and proceed on to forgot God, BUT he will remember everyone of you. Look like they have also forgotten Mr.Ivan who intensively hovered over these island for day in 2004.

  4. G.Towner says:

    Marco Archer is the right man for the job. Hopefully he will remain focused on his responsibilities as the finance minister. Little by little we are seeing the improvements. We need now for Alden to get at those employers who abuse employees and underpay them. We just don't need more jobs, but job-quality for all. It just doesn't make sense to balance the books and their is no justice in the job field. PPM need to side with Ezzard / Tara and start looking out for the welfare of all workers which drive this economy. As for Marco he is doing a swell job. Keep it up!

  5. Captain Obvious says:

    Obviously, a marked difference from the previous Minister of Finance. Keep at it, Marco!

  6. Anonymous says:

    Whilst the recent efforts must be applauded for a relatively cost free win, Cayman still has a long way to go to get the financing costs it should be attracting. US treasuries pay 0.10 pct in 1 year and Cayman has a similar risk weighting, we just need to realise our own weight in the debt world, Government debt is gold for financial institutions and with new Basle 3 rules it will be in demand, almost a pre requisite!

  7. Anonymous says:

    Over ten years we save 60% of what the turtle farm loses every year.

    • B. Hurlstone says:

      Did yousee the above comment, Mr. Archer?  If you do away with the gift to the turtle farm you can save us $100,000,000 in ten years.  Think about it……..

      • Anonymous says:

        He lacks the backbone to do that.

        • Anonymous says:

          He cannot by himself divest Government of the mentioned asset.  He can recommend but thats about it.

        • Anonymous says:

          Oh. So responding to expat baiting shows you have backbone? LOL. Marco is sensible enough to realize the problem is not the Turtle Farm but Boatswain's Beach.

      • Anonymous says:

        There is more waste than just the Turtle Farm.  Has anyone looked into the inflated director salaries at Pedro St. James?  This is still left over from UDP days of paid cronies.  Archer needs to trim the fat in many places and there are plenty to look at! 

  8. Cmoose says:

    When is the last time money actually went back in the Govt bank account?…

    Good job Mr. Marco..!!!!

    Far better than the last teamin office. They new better how to spend than to save and usually on themselves.

    Very refreshing to hear such news.

    • Anonymous says:

      This is a good thing, but make no mistake this is not money back in the government's purse. There is no cash in hand, just a lower interest rate.

  9. Peanuts says:

    No Talk, No Trips to London or New York. Just real work and smart no nonsense honest negotiation. What a difference to the Cohen cock and bill we had to but up with the in the past. Lets hope that the other members can be a sucessful. Thanks to Mr. Archer and his team.

  10. Whodatis says:

    Great job, Mr. Archer!

    However, why are you being so hard on yourself?

    Couldn't we just print a few hundred BILLION dollars (pounds), wait for the reports, then announce the "evidence" of an economic recovery? You know … like mommy does?

    What's that? Oh yeah – we don't own our own fiat, backless, hamster-wheel currency. Shoot … that tiny little detail slipped me for a moment.

    Anyway, keep up the good work sir.

    All things considered, Cayman remains in a far superior economic standing than practically every other major economy.

    (Cameron and Obama only wish their greatest challenge today was that of "borrowing". Their woes go much, much deeper than that, poor fellas.)

    • Anonymous says:

      Whodatis' usual twisted variant of the realities to justify his rants against Mother instead of focussing on solving Caymans own issues..how much does Cayman actually owe and have in cash? Oh thats right, nobody knows because the audits cannot be finished and complete lack of transparency on the subject..

      • Whodatis says:

        "Mother" just printed £350,000,000,000 (billions) of pounds out of thin air and then declared an economic recovery.

        Lol!!

        Come on, dude!?

        * Btw, I always focus on solving Cayman's own issues … your problem is – your reaction is selective.

        🙂

         

    • anon says:

      Here's another thing that seems to have slipped you – Cayman is not a major economy. Comparing Cayman to "…every other major economy" is a classic big fish, small pond mindset. 

      • Whodatis says:

        (Please see above.)

        Everything is relative, my friend.

        Quit shifting the goalpost as it suits your agenda.

        Pretty pathetic actually.

        • anon says:

          In this case, it is not relative, it is absolute. Cayman's economy ranks in the 150-160 range, size wise, out of approximately 195-200 economies.

          So, not close to a major economy – no  goalpost moving required. 

           

           

        • Anonymous says:

          What he meant was look at the GDP per capita and compare that to the rest of the world. We are squarely in the top 10. Currently our GDP per person is almost US $55K.

          Sure we don't do trillions of dollars in trade (might be in all those bank accounts here) but we dont have hundreds of millions of people either. 

          Like the man said, its relative.

          Oh and Mr. Archer; Well Done Sir.

          • anon says:

            Now GDP per capita is relative – but it's not what he said  – and a high GDP per capita does not a major economy make. Nor a happy country, if the amount of bitching and complaining reflected in the pages of CNS is anything to go by.

            Of course he might be saying it now because you could well be whodatis in disguise – and to quote him/you, that would be " pretty pathetic really."

      • Anonymous says:

        Funnyhow you realise there is no real comparison between cayman and these countries when it is convenient.

        • anon says:

          Actually I find it convenient to remember just how small Cayman is all the time. It helps to keep things in perspective – something the original poster finds impossible to do.

    • Anonymous says:

      US is going great. You should visit!

      • Whodatis says:

        As I have the UK, I contribute to the US economy on a regular basis buddy.

        In any event, it appears as if Cayman is going great as well. If you don't believe me you can walk down to the waterfront right now and ask any of our thousands of American tourists.

        • Anonymous says:

          The UK is also doing remakably well too, despite what you say – just ask any of the millions of American tourists who visit each year – or the tens of millions of visitors from the rest of the world (approximately 6 for every American)

    • Anonymous says:

      Cayman is not a major economy.  It is a tiny parasite economy.

      • Whodatis says:

        Re: "Cayman is not a major economy."

        (Talk about stating the bleeping obvious.)

        Nevertheless, your point is irrelevant. The state of every national economy must be rated against its scope, actions and responsibilites.

        Round here we have a saying that goes something to the effect of;

        "Never bite off more than you can chew!"

        A never-ending printing of new money out of thin air is indisputable proof of a choking economy … just ask Zimbabwe.

        In any event, not a single respondent has touched upon the focal point(s) of my post – that of "quantitative easing" (and backless currency).

        Just keep those presses printing ok? Just prepare a good explanation for your grandkids when they are paying $100 for a can of coke in 40 years time.

        (Granted, as we (Cayman) are pegged to such a major currency it will effect us as well. However, we have no say in the matter. It is the responsibility of the ignorant and lazy "1st world" masses to see the illusion for what it is and bring about a change.)

        * As for parasites, we would be hard-pressed to find any greater and more blood / natural resources-thirsty than the "major" economies of the world. When you come to terms with this fact a lot about this world turns from murky to crystal clear … but I doubt you're interested.

         

    • Anonymous says:

      And yet, I can't help but feel that, without the backing of the country that uses that "hamster-wheel" currency, the Cayman Islands credit rating would be on a par with many other Caribbean economies.

      And don't be so hard on Cayman, we do own our own fiat, backless, hamster-wheel currency – it's called the Cayman Dollar and it's nailed in value to the fiat, backless, hamster-wheel US Dollar. 

      Unless everybody else has started using Bitcoin…………

    • Anonymous says:

      Where, Mr. Whodatis, was your ascerbic commentary when the previous government of uneducated self seeking parasites, was pillaging our economy in pursuit of personal gain and enjoyment….?

      • Whodatis says:

        Ummm … I was right here.

        Perhaps you ought to ask yourself; "Where was I?".

        My objective in this thread is to highlight the faulty rhetoric and inconsistencies as it regards the assumption of Cayman having a failed or endangered economy.

        It is simply false – at least by global standards … and most definitely by UK standards!

        The only way one can reach such a conclusion is via a monumental ignorance of global politics and economics or bare-faced malice.

        (I wonder what category some of my fellow posters fall under?)

        P.S. Thinly veiled attacks on Mr. Whodatis will neither negate the truth or relieve that hot-flash you're experiencing brought on by my words.

        P.S.S. As for "uneducated self seeking parasites" – you may have a point there. However, when we compare economic standings Cayman's still trumps that of most other countries today.

        So perhaps you can tell us what good all of that book-learnin' did for the USA and UK?

        I know ol' slimey Tony "Oil Chairman" Blair is as big a parasite the world has ever seen. Add to that a war criminal. However, the "pursuit of personal gain and enjoyment" can be a treacherous journey at times I guess.

  11. Anonymous says:

    I gave you my vote in the last elections, and I can say it is definitely not your last from me! Keep it up, Sheriff Archer!

  12. Anonymous says:

    Take done of these savings and the surplus that has been announced and apply it to the cost of doing business in Cayman it's time to reduce some if the fees. The cost of doing business is killing small to medium Caymanian businesses!

  13. B. Hurlstone says:

    Saving six million dollars is commendable, even it it is only 1.2% of the half-billion we still owe.  The politicians responsible for this debt should be tarred and feathered and banished from our shores.  What I find odd is that with all the debt incurred on countless grandiose undertakings, they haven't learned anything.  They STILL want to spend, spend, spend.  Hey!…. Let's build a new dock!  Let's build a new airport!  Let's give money to people that keep us in office!  It.s sad, but that's the way it works.  Fact:  You cannot spend your way out of debt.

  14. Anonymous says:

    Well done Minister Archer, finally we have someone with an Accounting/Finance background in charge,

     

    Thanks

  15. Anonymous says:

    'Archer Gets back $6M in Interest'?  Sounds like CNS is on Marco's re-election bandwagon again.  The title should simply be 'MLA in CIG actually uses common sense'.   Marco's a decent guy, but taking such an obvious and simple action shouldn't be lavished with so much credit and praise like it was ingenious.  Well…then again we are talkng about the CIG, so maybe we should shower an MLA with praise for exercising common sense.

    • Anonymous says:

      It is all relative. When you have had a reckless buffoon like mcKeeva in charge of your finances Marco seems like a genius. 

  16. Anonymous says:

    Great, now for the baloon notes..

  17. Anonymous says:

    Well, one has to start somewhere, add that $0.6 million to another couple hundred thousand avoided in overdraft from Archer's cash management program and I'd say the minister has earned his salary for the first year in Office, not too shabby

    • Anonymous says:

      This is what happens when you have "qualified and trustworthy" Caymanians in positions where sound decisions and actions can be taken. Never mind the "Du Du" that was there before, where deals were made with companies like Cohen & Associates that cost us "big money" with absolutely zero results. Let's not forget the other "mysterious financing company" in New York who donated 1 million US dollars to a Caribbean University all the name of an Honarary PhD – which ultimately was sent back to New York. What did the Cayman Islands get for that ?? 

      Ladies & Gentlemen, since "qualified and trustworthy" Caymanians are now at the helm and making sound fiscal decisions for the Cayman Islands, there is a feeling/sense that some stability is starting to emerge and things will turn around in the future.

      I also believe that Her Excellency the Governor as a qualified person in finanace, will ultimatelyhelp Cayman's position in his fiscal responsibility as well.      

    • Anon says:

      The article didn't say 0.6 million – it said 6.2 million. 

    • Chris Johnson says:

      I assume he has consulted some experts in the negotiations unlike the last Minister of Finance who was above all of that and cost the country millions by his ineptitude.

      • squidworth says:

        I agree Chris … he is not just listening to one source and that is why Marco is going to get re-elected despite what party ticket he runs with. If the party decides to spend more, it will just make Marc look bad, but I think Alden and crew acknowledges his expertise in the financial arena. That is why all politicians should be more ears and less mouth – More flexible, open to the intelligent people instead of being staunch in their personal ideas of shaping Cayman in their own image.

        • Chris Johnson says:

          Thanks for the support. Although I have not had the pleasure of meeting Marco he does seem to be doing a good job and in a modest way. So far no signs of his signature on the currency notes. ( joke ). I had the distinct pleasure of knowing his father who was compassionate when I breached the motoring law many years ago and when I got to know him found him to be an exceptional man of the law and a knowledgable enthusiast in cricket and football. I guess the fruit does not fall short of the tree and I wish Marco the very best in his role as treasurer of our finances.

      • Anonymous says:

        When will the audited accounts be presented? 10 years no consolidated accounts is taking the pi$$$ at multiple levels and happened under both UDP and PPM

  18. Anonymous says:

    I thought maybe he could have paid Cohen & Co a few hundred grand, got him and his mates a little trip on a private jet from the Bahamas and acheived nothing.

  19. Anonymous says:

    I hear you, Marco! Well done!

  20. Anonymous says:

    While that is good, I believe that we should not borrow another red cent until every loan has been repaid.  If we can achieve that, we'll never have to borrow again.

  21. Anonymous says:

    Thank you Marco. This is what can happen when you have someone educated in charge of finance who really understands how to run the country and is only looking at what is best for the country. 

    • Anonymous says:

      Yes, Marco understands and he will be just focusing on the interest of his people and country – then when you have made the strides of those interest rate reductions.  Please have a look at the banks who are killing the poor people with interest on their checking mortgages, loans etc. and have no mercy and negotiating skills to assist the customer – time to take a stance on these matters also.

    • Anonymous says:

      Well, the Cayman Government is still half a billion dollars in debt and now they want to build schools, new dock for cruise ships, modernize the airports, and then list goes on and on.  Where in the hell are they going to get all this money from to do these projects????

    • Diogenes says:

      Someone honest…