The International Monetary Fund (IMF) Friday said Barbados had passed all the indicative targets under the Extended Fund Facility (EFF) to date and that “good progress also continues to be made towards implementing structural reform” under the EFF.
“In this very challenging environment, Barbados continues to make good progress in implementing its ambitious and comprehensive economic reform programme, while expanding critical investments in social protection,” said Bert van Selm, who lead an IMF delegation that conducted a staff visit via videoconferencing over the past three days.
He said that the international reserves, which reached a low of US$220 million or five to six weeks of import coverage, at the end-May 2018, are now in excess of one billion US dollars.
“All indicative targets for end-June under the EFF were met. The targets for international reserves, net domestic assets and the primary balance were met with some margin, which bodes well for meeting the end-September EFF targets,” he added.
In October 2018, the IMF approved a four-year US$290 million Extended Arrangement under the EFF.
The IMF official said that the coronavirus (COVID-19) pandemic has had a major impact on Barbados’ economy, with a double-digit decline in economic activity projected for 2020.
He said tourism came to a virtual standstill between March and June 2020: airlift declined precipitously, most hotels closed, and occupancy plummeted at facilities that remained open. In early July, the island cautiously started reopening the economy for international tourists, after the authorities effectively halted local transmission of the disease.
But van Selm said good progress also continues to be made towards implementing structural reform under the EFF.
“The two structural benchmarks for end-June 2020, related to tax and customs administration, were both met. A revised central bank law is expected to be ready to be sent to Parliament in September.
“The team is looking forward to conducting discussions for the fourth review under the EFF in late October and would like to thank the authorities and the technical team for their openness and candid discussions,” he added.