Chamber renews concern over public debt
The Gibraltar Chamber of Commerce has restated its “longstanding concern” at the level of public debt and the way it is calculated.
While the Chamber said the current level of debt was “entirely manageable” given Gibraltar £1.6bn GDP, it remained wary of the government’s exposure to overall contingent liabilities including the investments made by the Gibraltar Savings Bank.
“The concern was, and remains, that should these investments turn sour, the government - and hence the taxpayer - would, as the ultimate guarantor, need to meet these liabilities,” the Chamber said in its annual report, published yesterday.
“Prudent banking practice suggests that all such liabilities - including public debt - need to be taken into account.”
“Put simply, there is no getting away from the principle that aggregation of liabilities, when applied appropriately, means that all debt exposure - actual or potential - must be added up and held against the source of income - revenue or capital - that will be looked to when repayment is due.”
“Money which the government has borrowed will need to be paid back.”
The Chamber noted, however, that provided the investments performed as planned, “…the Chief Minister is still entitled to the support of our institutions.”