NASSAU, BAHAMAS: The Bahamas’ total public-sector debt surged by nearly $1.28 billion over the past fiscal year, driven partly by substantial borrowing linked to the government’s acquisition of the Grand Bahama Power Company and increased financing across state-owned enterprises.
According to the Ministry of Finance’s Public Debt Statistical Bulletin for the 2025/2026 fiscal year, total public-sector debt stood at an estimated $14.697 billion at the end of June 2026.
This represented an increase of $1.276 billion, or 9.5 percent, compared with the $13.420 billion recorded at the end of June 2025.
Central government’s net financing activities accounted for 54.6 percent of the increase, while government agencies and government business enterprises accounted for the remaining 45.4 percent.
The report revealed that the outstanding debt of agencies and government business enterprises climbed by $579.1 million, or 35.1 percent, to $2.230 billion during the period.
A significant portion of that increase was connected to Grand Bahama’s energy-sector overhaul.
The Grand Bahama Energy Company (GBEC), the special-purpose vehicle established to acquire the Grand Bahama Power Company (GBPC), obtained $150 million in external financing towards the purchase.
GBEC secured another $50 million from a domestic financial institution, bringing the financing associated with the share purchase to $200 million.
The company also obtained an $80 million loan facility to support GBPC’s capital expenditure and working-capital requirements.
The debt bulletin further revealed that approximately $131.8 million represented legacy commercial debt held by GBPC when it was acquired. Some 83.3 percent of that debt was denominated in Bahamian dollars, while the remaining 16.7 percent was in foreign currency.
The GBPC-related facilities were among the major factors contributing to the sharp rise in government-guaranteed debt.
Total debt guaranteed by the government more than doubled during the fiscal year, increasing by $373.4 million, or 113.2 percent, to $703.4 million at the end of June.
Around 98.7 percent of the government’s guaranteed exposure was tied to government agencies and business enterprises.
GBEC accounted for $280 million in newly guaranteed facilities, consisting of $200 million in US-dollar financing and an $80 million Bahamian-dollar loan.
Government guarantees were also extended to WSCDesalCo, which secured a $50 million credit facility to acquire, upgrade and expand water-production operations throughout the Family Islands.
Meanwhile, central government debt increased by $696.9 million, or 5.9 percent, to $12.466 billion.
Despite the increase in the nominal debt stock, the central government’s debt-to-GDP ratio declined marginally to 70.7 percent from 70.9 percent a year earlier. The Ministry of Finance attributed the reduction to the pace of economic growth relative to net new borrowing.
Domestic central government debt rose by $585.6 million, or nine percent, to $7.062 billion. The increase was driven primarily by $532.6 million in net Treasury bill issuance and $143.7 million in net domestic bond issuance.
External central government debt increased by $111.3 million to approximately $5.404 billion. This included a $160 million policy-based loan from the Inter-American Development Bank and $100 million in policy-based financing from the Development Bank of Latin America and the Caribbean.
Public-sector debt-service payments, including refinancing operations, totalled $3.341 billion. This represented a $1.741 billion, or 34.3 percent, decline from the previous year, when costs were elevated by the government’s external bond liability-management exercise.
Interest payments stood at $731.3 million, while principal repayments amounted to $2.610 billion.
