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A busy street in Bridgetown, the capital of Barbados, before the onset of the coronavirus pandemic. (File photo)

Barbados economy on track, reports IMF

A busy street in Bridgetown, the capital of Barbados, before the onset of the coronavirus pandemic. (File photo)

The International Monetary Fund (IMF) is reporting that Barbados continues to make good progress in implementing its economic reform programme.

(Photo: businessinsider.com)

This assessment was made at the end of the IMF four-day visit to the Caribbean nation discussing the implementation of Barbados’ Economic Recovery and Transformation (BERT) Programme, which is supported by the IMF under the Extended Fund Facility. Head of the IMF team, Bert van Selm said the country has met all of its targets to date.

According to the IMF Mission Team head, “Barbados continues to make good progress in implementing its economic reform program. International reserves reached US$740 million at the end of 2019, from a low of US$220 million in May 2018.

“The team is looking forward to return to Barbados in May to conduct the discussions for the third review under the EFF and would like to thank the authorities and the technical team for their openness and candid discussions.”

– International Monetary Fund

The completion of the external debt restructuring in December 2019 has reduced economic uncertainty, and the agreed terms with creditors will help to keep public debt on a clear downward trajectory. On December 11, 2019, Standard and Poor’s upgraded Barbados’ foreign currency sovereign credit rating from Selective Default to B-.”

The IMF pointed out that all indicative targets for the end of December under the EFF have been met. The program target for Net International Reserves was met by a wide margin, as was the target for the Central Bank of Barbados’ Net Domestic Assets. The primary surplus for the first three quarters of financial year 2019/20 amounted to almost five per cent of (annual) GDP, with the IMF asserting that Barbados is on track to reach the six per cent primary surplus target for FY2019/20.

The IMF team observed that good progress also continues to be made towards implementing the structural benchmarks under the EFF. A revised Central Bank of Barbados (CBB) law is expected to be ready to be sent to Parliament shortly.

Preparation of the budget for financial year 2020/21 targeting a primary surplus of 6 per cent of GDP is well underway. “The team is looking forward to return to Barbados in May to conduct the discussions for the third review under the EFF and would like to thank the authorities and the technical team for their openness and candid discussions,” the IMF said.