Economic and Financial Review - June 2019

June 2019 Economic and Financial Review ANTIGUA AND BARBUDA

category, which accounted for 43.9 per cent of current expenditure, rose by 6.4 per cent ($11.7m) to $194.4m, partly associated with double pay in lieu of a salary increase, overtime payment as well as new hirings. Spending on goods and services grew by 10.7 per cent ($7.7m) to $79.5m, partly associated with costs related to office relocations, miscellaneous activities and office supplies. Simultaneously, higher levels of subventions to statutory corporations contributed significantly to the 3.7 per cent ($4.3m) expansion in spending on transfers and subsidies to $119.7m. Despite a higher level of total outstanding debt, interest payments contracted by 7.7 per cent ($4.1m) to $49.7m, possibly reflecting an increase in accounts payables. Investment in the government’s capital programme contracted by 12.1 per cent ($4.6m) to $33.4m, following robust expansion in the comparable period of the previous year. This contraction was associated with delays in a few of the major government projects, including the Friars Hill Road rehabilitation project. Meanwhile, the intake from capital revenue almost doubled, but remained low at $2.3m, compared with $1.3m, a year earlier.

The deficit recorded over the first six months of 2019 was largely facilitated through an accumulation of arrears, and to a lesser extent, domestic and external borrowing. Total arrears for the review period stood at $55.2m compared to a total of $47.0m in the comparable period in the prior year. The continued build-up of arrears suggest the need for prudent fiscal policies in the near term to contain further accumulation of arrears and limit high debt service costs. June 2019, up from the $3,414.9m recorded at the end of December 2018. The expansion in the debt stock was attributable to an increase in both the domestic and external debt of the central government. Central government outstanding debt, which accounted for 82.2 per cent of total outstanding debt, advanced by 1.5 per cent to $2,831.7m. The external debt portfolio was 2.0 per cent higher than the previous year, on account of disbursements by the Caribbean Development Bank. Concurrently, the domestic debt stock rose by 1.0 per cent, and was associated with the receipt of a temporary advance and an The total disbursed outstanding debt of the public sector was provisionally estimated at $3,445.8m at the end of

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Eastern Caribbean Central Bank