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Following its seventh and final review of Barbados’ Economic Recovery and Transformation programme, the International Monetary Fund’s (IMF) executive board has approved the drawdown of an additional US $23 million in financing. This brings the total disbursement under the Extended Fund Facility arrangement to US $435 million.
In a statement announcing the approval, the IMF said that Barbados had made significant progress in the early stages of the programme, which allowed it to weather the pandemic:
“Programme performance has been strong despite significant economic shocks associated with the COVID-19 pandemic, natural disasters, and the war in Ukraine. Macroeconomic stability was restored before the pandemic reached Barbados in March 2020, with a combination of fiscal consolidation, a comprehensive sovereign debt restructuring in 2018 and 2019, and structural reforms to enhance growth. This facilitated a countercyclical macroeconomic policy response in 2020 and 2021.”
The statement noted, however, that the economy still faces challenges:
“The key risk to Barbados’ economic outlook is a further lengthening of the pandemic, with the recovery in tourism depending on developments in key source markets. An intensification of the war in Ukraine could further increase global commodity prices.”
Read the full statement here.