IMF Concludes Fifth Review Under the Extended Fund Facility for Barbados

  • The Executive Board of the IMF concluded the fifth review of its Extended Fund Facility (EFF) for Barbados. The completion of the review allows the Barbadian government to drawdown SDR 17.00Mn (about US$24.00Mn), bringing total disbursements to the equivalent of SDR 288.00Mn (about US$415.00Mn). 
  • The four-year extended arrangement under the EFF was approved on October 1, 2018, and is for an amount equivalent of SDR 322.00Mn (about US$464.00Mn). The disbursement will help the sovereign to meet the balance of payment needs, boost resources for essential COVID-19-related outlays, and catalyze additional support from development partners. 
  • Despite the economic challenges, Barbados has continued to implement its comprehensive Economic Recovery and Transformation (BERT) plan aimed at restoring fiscal and debt sustainability, as well as increasing reserves and growth. The government is targeting a debt-to-GDP ratio of 60% by 2033 through a combination of fiscal consolidation, policies to boost growth, reform of public finances and debt restructuring. 
  • However, factors such as the depressed economy, especially as tourism remains below pre-pandemic levels, and high unemployment, will challenge the government’s ability to reach its primary balance target of 6% over the medium term, which could set back its goal to reach the targeted debt level by 2033.

(Source: IMF & NCBCM Research)