BASSETERRE, St. Kitts, June 28, 2017 (Press Unit in the Office of the Prime Minister) – The Team Unity Government’s swift move to pass the Eastern Caribbean Partial Credit Guarantee (Corporation) Agreement Bill 2017, in the National Assembly is another demonstration of the Dr. Harris-led Administration’s commitment to the development and advancement of Small and Medium-size Enterprises (SMEs) in St. Kitts and Nevis.
After a short but intense debate from parliamentarians, the Eastern Caribbean Partial Credit Guarantee (Corporation) Agreement Bill was read a third time and passed into law today, Wednesday, June 28, 2017.
The commitment to establish this scheme was demonstrated March 2, 2017, when the Monetary Council of the Eastern Caribbean Central Bank (ECCB) approved the Eastern Caribbean Partial Credit Guarantee Corporation Agreement. The Agreement was signed by all ECCU Member States with the exception of Montserrat.
Prime Minister and Minister of Finance, Dr. the Honourable Timothy Harris, told the National Assembly that the passing of the Eastern Caribbean Partial Credit Guarantee Corporation Agreement Bill 2017 will facilitate the growth and sustainability of Small and Medium-size Enterprises here in the Federation and across the ECCU.
“It is also consistent with the proposals made in the presentation of our 2017 Budget last December, when my Government indicated that an unprecedented amount of resources were earmarked for the support of small business development and expansion. The 2017 Budget committed funding in excess of $5 million to enable my Government to honour this very important commitment to our people. Our action here today is evidence of my Government’s commitment to help to create economic opportunities for those individuals who wish to operate a micro, small or medium enterprise as we strive to achieve inclusive growth for all in our Federation,” Dr. Harris continued
Dr. the Honourable Timothy Harris further stated that this agreement will also complement the ongoing Fresh Start Programme that was implemented by the Team Unity Government to ease the financial constraints faced by SMEs.
“More persons have accessed financing under that programme than any other time,” Prime Minister Harris stated. “It is the largest portfolio of loan financing ever provided in the context of St. Kitts and Nevis. We are leading the way Mr. Speakerwith respect to that. We are leading the way in bringing help to the people who need the particular help.”
The framework to be established would allow the Corporation to provide a partial guarantee on a loan made by a participating lender, such as a commercial bank or a credit union, to an SME borrower within the Eastern Caribbean Currency Union (ECCU).
The partial guarantee is intended to provide credit enhancement for those borrowers that do not meet typical bank credit standards. If a borrower defaults, the Corporation would pay to the lender a portion of the losses, thereby reducing the lender’s risk in the transaction.
The agreement must first be ratified by five ECCU member states before the Partial Credit Guarantee Scheme can be established.