Guyana has not borrowed from Islamic Bank, but US$900 million is available– Finance Ministry, following Jagdeo’s criticism

Last Updated on Saturday, 7 April 2018, 18:48 by Denis Chabrol

The Ministry of Finance on Saturday said Guyana has not borrowed any money from the Islamic Development Bank (IsDB), but could potentially tap into a total of US$900 million in loans and grants

“Guyana has not received any loans from the Islamic Development Bank,” the Finance Ministry said after Opposition Leader  Bharrat Jagdeo criticised government for borrowing US$900 million from the IsDB as reported in sections of the media.

“Contrary to that conclusion, the IsDB has a resource envelope of US900M that is potentially available from which the Government of the Cooperative Republic of Guyana can borrow,” the Finance Ministry added.

In his speech to the 43^rd Annual Meeting of the IsDB Group, the Finance Ministry said Minister Winston Jordan was clear in his identification of the named sum.

“The current package of potential projects, consisting of proposed grant and loan operations is valued at approximately US$900M. The Government is currently in the process of designing projects to commence accessing some portions of the IsDB resources,” the ministry added.

The Ministry explained that during the period 27-29 November 2017, the IsDB mounted a mission to Guyana to develop a medium term work plan for the period 2018- 2022. That work plan outlines a pipeline of projects that the Bank can support over the next 5 years.

The potential areas of collaboration between the Bank and the Government of Guyana cover several development sectors including agriculture, banking and finance, human development, energy and rural development.

The Opposition Leader had moments earlier issued a statement criticising government for borrowing US$900 million from the IsDB, accusing the David Granger-led administration of resorting to large scale borrowing to finance the massive national budgets mainly on consumption.

“This failed approach to national economic management was tried in the past. It led to a bankrupt country and resulted  in devastating consequences for our people.   I am sure everyone would recall that the external debt was over 900 per cent of GDP in 1992, which was reduced to 36 per cent of GDP in 2015. They plan to double it again within give years,” said Jagdeo a former Finance Minister.

He said borrowing without feasibility studies and spending haphazardly with no vision or plan, “particularly in the wasteful and corrupt manner that is now the hallmark of the Granger-led Administration will not solve the economic malaise that we face, but lead to pawning the well-being of current and future generations of Guyanese.”