Government to honour debt obligations in 2011/12

KINGSTON — A sum of $132 billion has been set aside in the 2011/12 Estimates of Expenditure for the Government’s repayment of internal and external debt and sinking fund contributions.

In terms of internal debt, a total of $45 billion of the money will deal with market issues such as repayment of local registered stock (LRS) issued to the Bank of Jamaica; repayment of Jamaica Dollar Benchmark Investment Notes issued under the Jamaica Debt Exchange (JDX) initiative; repayment of land bonds; and repayment of LRS issued for the financial sector restructuring under the Financial Sector Adjustment Company (FINSAC).

Approximately $14 billion of the sum will go to the redemption of Treasury Bills; $5 billion towards contingent payments; and $835 million for repayment of institutional loans.

For external debt, $34 billion of the overall figure will be used to repay US$400 million 11.7 per cent bond that matures in May 2011. Another $10 billion will go towards repayment of loans from multilateral and international bodies, while $6 billion will be used to repay bilateral loans from Government and Government bodies, including the United States Agency for International Development and the Governments of Japan and the United Kingdom.

Some $9 billion of the allocation will be used to cover a contingency for the repayment of guaranteed loans and another $4 billion of the sum will be used to repay institutional loans.

By ALECIA SMITH, JIS Reporter