Govt needs $598m for last-quarter debt

Government will require about $598.6 million to pay debt for the December 2025 to March 31, 2026 period.

With the Ministry of Finance projecting that the public debt stock will be around $15.04 billion at the end of March, total debt payments for the full 2025-2026 fiscal year are now an estimated $2.5 billion.

This information is detailed in the January 27 Pre-Election Economic And Fiscal Update Report published by the Ministry of Finance.

“Approximately $598.6 million will be required to service existing debt obligations for the period December 2025 to March 2026, including $263.3 million for interest expense, $304 million for amortisation, $3 million for loan expenses and $28.2 million for Sinking Fund contributions,” the report stated.

Budgeted amount

“This is approximately $110.3 million less than the budgeted amount for the period and is attributable primarily to the liability management operation conducted in June 2025, which involved the repurchase of approximately US$340.4 million of the Government’s 2029 6.5 per cent Note and the issuance of a new US$500 million 2035 eight per cent Note.

“Expenditure was therefore front-loaded in the first half of the financial year. The interest on the new US$500 million eight per cent Note, which will commence in December, will be somewhat mitigated by the reduced payment on the Government’s 2029 6.5 per cent Note due in March 2026.”

Repurchase

The ministry said the total revised debt expenditure of $2.5 billion was about $682.9 million more than the amount approved in the Estimates, attributing the increase primarily to “the repurchase of the Government’s 2029 6.5 per cent Eurobond and to a partial prepayment of the International Monetary Fund External Fund Facility obligations, executed as a liability management operation in June 2025”.

With the public debt stock expected to be $15.04 billion at the end of the current financial year on March 31, the Ministry of Finance said this was comprised of domestic debt ($8.91 billion), external debt ($5.87 million), external guaranteed debt ($67 million) and Central Government arrears ($185.5 million).

Regarding state-owned enterprises (SOEs), the report noted that “at the end of September 2025, total SOEs arrears contracted to $77 million following a peak of $117.8 million in July 2022, which was the direct result of tax arrears accumulated by the Barbados National Oil Company Ltd and accrued NIS (National Insurance) arrears related to outstanding severance and NIS contributions by other SOEs”.

On average, the stock of SOE arrears “is expected to decline by at least $2.4 million per quarter during fiscal year 2025/26”. (SC)

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