Turks & Caicos Islands Government retains it BBB+ credit rating
#TurksandCaicos, June 25, 2022 – On the 29th of March 2022, Standard and Poor’s Global (S&P) released the results of the review of the 2021 sovereign credit rating for the Turks and Caicos Islands (TCI). S&P has affirmed the country’s sovereign credit rating for long-term bonds, denominated in both domestic and foreign currency, of BBB+. Additionally, the agency also maintained the outlook as Stable for the TCI.
The Rating Agency advised that the stable outlook takes into account that the country’s economy will continue to recover given the strong performance of tourism and will improve in 2022. Furthermore, S&P believes the TCI will continue to adhere to prudent financial management and limit borrowing, and that fiscal reserve balances will increase during the next two years. Additionally, the rating agency also expects continuity in TCI’s institutional relationship with the U.K.
In its report, the rating agency advised that the rationale for the rating was a result of the Country’s institutional and economic profile. That is, the economic recovery led by resurgence in tourism and continued institutional stability. S&P indicated that despite the short-term pressures of the global COVID-19 pandemic in 2020, the TCI Government’s prudent actions, aided by the U.K.’s swift transfer of vaccines, allowed international travel to resume as early as the first quarter of 2021. The combination of the Government’s swift response, coupled with pent-up demand in key source markets, led to a strong recovery in tourism, which in turn, has led to a better-than anticipated economic recovery. S&P estimates GDP per capita to be $23,674 in 2021, up from $20,757 in 2020 – a 14% year over year increase. Tourism remains the core pillar of the economy, indirectly accounting for about 65% of GDP.
S&P indicated that the ratings could be revised upwards if better-than-expected GDP increases and continued favorable growth prospects were to substantially boost economic resilience. Additionally, the rating agency also stated that they could also raise the ratings if better availability of timely data, especially on external flows and stocks, were to boost transparency and indicated that TCI enjoyed a significantly stronger economic or external position.
However, if the rebound in tourism is interrupted or turns out to be weaker than expected, leading to prolonged stress on revenues, this may cause the TCI Government to run persistent fiscal deficits that could materially worsen public finances. This could lead to a down grading of the rating.
Commenting on the rating, Minister of Finance, Investment & Trade, Hon. E. Jay Saunders, stated that “I am happy and extremely proud that S&P saw fit to maintain our country’s credit rating at BBB+, particularly at a time when many countries had theirs downgraded – mainly due to the COVID-19 pandemic. This is a testament to the strength of our economy, and particularly, our government’s prudent handling of it. We have taken particular note of S&P’s comment that they could raise the ratings on better availability of timely data, and we are working towards achieving that.”
Three Days to NIB Rate Increase for 2023
By Dana Malcolm
#TurksandCaicos, March 29, 2023 – On April 1st, the second round of increases on contributions at the National Insurance Board will kick in for the Turks and Caicos workforce. Announced last year, the increases were instituted to keep the NIB from running out of money by 2027 as it services a population that is living longer with contributions that had not been increased in 30 years.
As the Government’s new financial year begins, increases at NIB will mean a higher cost for doing business and a higher cost for running the Government.
The private sector is expected to pay contributions at a rate of 11 percent on your taxable income. The hike is up from last year’s 10 per cent; six percent of which is to be paid by the Employer and five percent is to be paid by the Employee. For wages of $2000, this will mean a $200 improvement in income per month to the NIB. As for the burn on residents’ pockets, based on a minimum wage of $1200 monthly salary, that’s at least $60 dollars a month and $720 per year.
Public sector rates will move to 10.15 percent up from 9.15 per cent with the worker paying 4.575 per cent and the Government paying 5.575 per cent; that’s $54 a month and $648 a year at minimum wage.
The NIB rate as of April 1, 2023, will jump to 9 percent for self-employed individuals; For self-employed individuals at minimum wage, that is $108 dollars a month or $1296 per year.
As taxable incomes increase so will the contribution.
The increases follow a 2019 Actuarial review, undertaken every three years, which unearthed that the NIB was facing a dismal future, possible collapse. Contribution rates were growing at a rate much slower than NIB expenses, which included beneficiary payouts. On that trajectory, the NIB’s earnings would be eclipsed by its income by 2027, forcing the worker protection plan to draw down on money saved for economic shocks like Covid-19.
Unsurprisingly, this was deemed untenable, and an immediate increase was recommended.
Despite this scramble to boost earnings, the NIB has simultaneously increased payouts. Payouts for pensions, funeral grants, maternity grants and more will all attract bigger sums.
These incremental increases on contributions and payouts were all consultant recommendations, informed statements from the Board.
Work of NAECOB critical in ensuring high standards in education, says Minister Hanna-Martin
Bahamas Golden Jubilee Events Announced, Celebrations Across 33 Islands & Cays
#TheBahamas, March 27, 2023 – As the 50th anniversary of our nation’s independence approaches, Bahamians everywhere are teeming with excitement and expectancy around the year-long celebrations set by The National Independence Secretariat.
Yesterday, the Prime Minister joined H.E Leslia Miller Brice, Chair of The National Independence Secretariat to unveil the Calendar of Events for the 50th Independence celebrations.
The calendar comprises a host of events, initiatives and recommendations for celebrations throughout all 33 islands of The Bahamas.
At this jubilant occasion the PM stated, “Celebrating independence is about acknowledging the greatness around us, the greatness within us, and the greatness ahead of us.
We are Bahamians. That identity is special.”
View the newly released calendar of events here:
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