Figure 20
Fiscal Balances – St Lucia (% of GDP)
Figure 22
Public Sector Debt to GDP Ratio
8.0%
75.0%
6.0%
70.0%
4.0%
2.0%
65.0%
20
03
/0
4
20
04
/0
5
20
05
/0
6
20
06
/0
7
20
07
/0
8
20
08
/0
9
20
09
/1
0
20
10
/1
1
20
11
/1
2
20
12
/1
3
0.0%
-2.0%
-4.0%
-6.0%
60.0%
55.0%
50.0%
-8.0%
Source: Ministry of Finance, St. Lucia: Economic and Social Review 2012
Figure 21
Interest Expense/ Revenue Ratio
14.3%
11.5%
11.8%
11.7%
11.6%
11.4%
11.3%
10.9%
10.4%
2004/05 2005/06 2006/07 2007/08 2008/09 2009/10 2010/11 2011/12 2012/13
Source: Ministry of Finance, St. Lucia: Economic and Social Review 2012, First
Citizens Research & Analytics
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2001
Current account balance
2002
45.0%
-10.0%
Source: Ministry of Finance, St. Lucia: Economic and Social Review 2012
The significantly higher fiscal deficit resulted in a jump
in the country’s debt level in 2012. At the end of 2012, the
total public sector debt stood at 71% of GDP, compared to
65% of GDP in 2011. The increases were largely in central
government debt, however, government guaranteed debt
and non-guaranteed debt continued to decline. Indeed, the
central government debt to GDP ratio was at 68.4% in 2012.
The maturity profile of the central government debt indicates
that 53.4% of the outstanding debt has short to medium term
maturities of less than 5 years, while 22.6% have maturities
over 10 years.
On 14 June 2013, Caribbean Information & Credit Rating
Services Limited (CariCRIS) lowered its credit rating on the
Government of St. Lucia. The rating was lowered to CariBBB
from CariBBB+ and relates to the following debt issues:
USD38 million, USD50 million and XCD140 million. The
lowering of the ratings is primarily based on the persistent
and severe deterioration in the government’s fiscal position,
and the resultant steady increase in its debt stock as well as
debt to GDP ratio.
First Citizens Research & Analytics believes the major
threat to the St Lucian economy is the growing debt
load and rising interest payments, which will affect the
country’s medium to long term economic prospects. In the
budget that was read in May 2013, it was suggested that
on the current path, the country’s debt/ GDP ratio would
surpass 100% by 2015 and that the IMF recommends an
XCD80 million adjustment (about 2% of GDP annually)
for the next three years to safeguard St Lucia’s fiscal future.
We therefore see fiscal consolidation imperative for the
medium to long-term fiscal sustainability.
37