Regional Government Securities Market Remains Stable Amidst COVID-19 Pressures

30 October, Basseterre, Saint Christopher (St Kitts) and Nevis – The performance of the Regional Government Securities Market (RGSM) remains relatively stable amidst increased short-term liquidity and financing pressures, due to the COVID-19 pandemic.

During the first half of 2020, the RGSM recorded EC$35.9 million, which represented a 6.7 per cent increase in total fundraising activity and a 4.6 per cent increase in the number of investors acquiring securities compared to the same period in 2019.

As at 30 September 2020, total funds raised since the RGSM was established in 2002, was estimated at EC$15.2 billion; 85.0 per cent of which represents short-term financing instruments issued by the five participating governments.

The Regional Debt Coordinating Committee (RDCC) has direct oversight for the RGSM. At its 43rd meeting held on 29 October, the RDCC noted the rising importance of the RGSM during this pandemic and underscored the need for preserving and maintaining market access for issuers and investors.

The RDCC also discussed matters related to developing a vibrant local currency bond market. The key areas for development reform include: primary market, investor base, secondary market, financial market infrastructure and the legal and regulatory framework.

Consequently, the RDCC approved recommendations to support reform initiatives for the development of the RGSM. The Committee also provided guidance to market participants on new disclosure and trading requirements.

The RDCC comprises the Senior Finance Officials of the countries of the ECCU and the Governor of the Eastern Caribbean Central Bank. The current chairman is Whitfield Harris Jr, Financial Secretary, Government of Antigua and Barbuda.