2020 Annual Economic and Financial Review

2020 Annual Economic and Financial Review

ANGUILLA

(1.4 per cent of GDP) compared with $11.0m (1.1 per cent of GDP) in 2019. In nominal terms Anguilla’s total disbursed outstanding public sector debt declined by 6.2 per cent to $462.8m at the end of 2020. This reflected lower debt levels of the central government ($28.5m) and public corporations ($1.9m). However, with the severe contraction in GDP, the debt to GDP ratio rose to 63.1 per cent from 48.1 in 2019. Banking Sector Developments The banking sector remained stable during the pandemic, with financial intermediation being one of the few sectors that recorded positive growth in 2020. Net foreign assets rose by 9.4 per cent to $669.3m while credit to the domestic economy declined by a further 3.0 per cent in 2020. Credit extended to the government and the private sector fell by 30.7 per cent and 0.7 per cent, respectively. Meanwhile, as the job market worsened, the banking system experienced substantial drawdowns of deposits including transferable (demand) deposits (24.7 per cent), foreign currency deposits (18.5 per cent) and other deposits (1.5 per cent).

Anguilla Public Finance (EC$M)

250.0

200.0

150.0

100.0

50.0

0.0

(50.0)

2016

2017

2018

2019

2020

Current Expenditure

Current Balance (before grants)

Capital Expenditure

To better position Anguilla to cope with the pandemic, the government increased expenditure on health services and social programmes. Consequently, current expenditure increased by $13.5m to $225.7m (30.8 per cent of GDP), which translated into greater spending on goods and services ($10.6m) and transfers and subsidies ($4.1m). Those developments gave rise to a current account deficit of $33.2m (4.5 per cent of GDP), in contrast to a surplus of $21.2m (2.1 per cent of GDP) in 2019. Capital revenue amounted to $10.3m (European Development Fund grant), which financed capital expenditure of $8.3m. In addition, current grants of $41.5m were received from the UK government. Overall the impact of the pandemic on the fiscal position was cushioned by the budgetary support received from the UK, which resulted in a lower overall surplus of $10.4m in 2020

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