…Dominica Sets New Record Low Rates for Treasury Bills
Roseau, Dominica – Tuesday, March 18, 2014 – The Government of Dominica has set a new record low rate for Treasury Bills on the Regional Government Securities Market, RGSM. On Monday, March 17, 2014, the Government of Dominica raised 20 million EC dollars at a record low 1.999% through the first of a series of three, 91 day Treasury bill offerings. Honourable Roosevelt Skerrit, Prime Minister and Minister for Finance welcomed the low Treasury bill rate. He viewed it as a vote of confidence in his administration’s policies.
“Many countries in the developed world especially in Europe have had difficulty in raising monies at concessionary rates. The discount rate achieved in Monday’s Treasury bill offering means that Government can now raise the financing it needs at a lower cost to the taxpayers of Dominica. The Government has had to grapple with our own challenges but we have worked actively to build a strong platform for sustained economic growth. Our prudent fiscal and economic policies have insulated the country from the more severe effects of the global recession,” Prime Minister Skerrit stated.
The rate of 1.999% is 50 basis points below the previous record of 2.49%. Investors view the purchase of the 91 day Treasury bill as a low-risk investment opportunity. The low Treasury bill rate demonstrated the ability of the Government of Dominica to raise money at relatively low cost.
Encouraged by this success in raising revenue through government will seek to raise an additional 65 million EC dollars on the RGSM through the remaining two, 91 day Treasury bills and one five year, 25 million dollar bond. This is to finance part of government’s operating budget and refinance existing government debt, the interest rate on which is much higher than the interest rate government obtains on its Treasury bills. Treasury Bills present an avenue to invest outside of the normal banking system.
The Dominica Labour Party Administration is committed to creating a local economy that develops the lives of the people of Dominica without creating unsustainable debt burdens.