Regional Debt Coordinating Committee Convenes 47th Meeting and Assesses Performance of Regional Government Securities Market
The RDCC, which comprises Financial Secretaries/Permanent Secretaries in the Ministries of Finance/Director General from the eight countries of the Eastern Caribbean Currency Union (ECCU) and the Governor of the Eastern Caribbean Central Bank (ECCB), has direct oversight for the Regional Government Securities Market (RGSM). It also provides a forum for enhancing the overall debt management capabilities of the member governments.
The following is a summary of the decisions emanating from the meeting:
The RDCC noted that activity on the RGSM continued to recover following an almost
15.0 per cent decline in 2020 due to the COVID-19 pandemic. The five participating member governments of the Eastern Caribbean Currency Union (ECCU) which issued securities on the RGSM in 2022 raised capital amounting to $1.2 billion in maturities ranging from 91 days to 10 years. The RDCC further noted that as at 31 May 2023, member governments had raised EC$18.1 billion on the market since its inception.
The RGSM provides investment opportunities for citizens and residents of the ECCU to diversify their investment portfolios. The interest rates offered on government securities are above the minimum savings deposit rate offered by commercial banks. In 2022, interest rates on Treasury Bills ranged from 2.0 per cent to 3.1 per cent and for bonds, rates ranged between 4.3 per cent and 7.2 per cent.
Notwithstanding the higher interest rates, the RDCC noted the continued dominance of institutional investors on the market and approved the following measures to encourage household investors to grow their wealth by investing in government securities on the RGSM:
- The creation of a roadmap to guide the design of special investment options for retail investors;
- Reduction of the minimum investment amount in special instruments from $5,000 to $500 for retail investors; and
- Absorption of the fees associated with those special instruments by issuing Governments of up to $5,000 per retail investor.
The implementation of those measures is subject to the approval of the ECCB Monetary Council and respective governments of the ECCB member countries.
The RDCC approved an official logo to commemorate the 20th Anniversary of the RGSM.
The Chairmanship of the RDCC was rotated to the Financial Secretary in the Ministry of Finance and Economic Management, Government of Montserrat, Lindorna Lambert. The Committee thanked outgoing the Chairman, Mike Sylvester, for his service during his tenure.
