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Barbados Government Seeks IMF Assistance

June 1, 2018 Ms. Christine Lagarde, Managing Director of the International Monetary Fund, made following statement today: “As announced by Prime Minister Mottley earlier today, the Barbados economy has been going through significant challenges for some years. The authorities are developing an economic reform plan designed to address these challenges, and they have asked the…

Christine Lagarde

June 1, 2018

Ms. Christine Lagarde, Managing Director of the International Monetary Fund, made following statement today:

“As announced by Prime Minister Mottley earlier today, the Barbados economy has been going through significant challenges for some years. The authorities are developing an economic reform plan designed to address these challenges, and they have asked the international community and the International Monetary Fund to assist them as they put the economy back on a path to recovery. An IMF team led by Bert van Selm will be visiting Bridgetown to start discussions on how the Fund can support the authorities’ economic plan. Our ultimate goal is to help Barbados achieve higher living standards and more inclusive growth for the years ahead.”

IMF Communications Department
MEDIA RELATIONS

PRESS OFFICER: Randa Elnagar

Phone: +1 202 623-7100Email: MEDIA@IMF.org

270 responses to “Barbados Government Seeks IMF Assistance”

  1. David Avatar
    David

    The good thing about the US setup is that nominees have to endure some public scrutiny before assuming office. How do we brake this nonsense by the political class? We have this endemic acceptance of patronage we can’t seem to brake away irrespective of the party in office.

  2. Roverp Avatar
    Roverp

    Interesting how these selfish, arrogant DLP yardfowls would want to blame a new government for all of their wrongs. But this has been the pattern for the past ten years under the DEMS blaming everyone except themselves for any problems and trying to get glory for the very very small amount of things they did right.

  3. Roverp Avatar
    Roverp

    The people of Barbados declared who was to blame for the failed economy with a 30 – 0 defeat of the DEMS and no DLP yardfowl spin will ever change that.

  4. Artax Avatar
    Artax

    Some are desperately trying to develop a sense of fear into the minds of Barbadians as it relates to this BLP administration’s decision to seek assistance from the IMF, by introducing the Jamaica.

    What upsets me with political party apologists is the fact that they come to the forum with information based on emotion, political party propaganda or what they “feel is correct”…….rather than based on research of the facts.

    Additionally, they are attempting to mislead BU by presenting information about Jamaica’s economy in 2001, implying that Barbados faces a similar fate in 2018……..without understanding the variables involved.

    In 1979, Jamaica became the first Caribbean country to obtained assistance from the IMF to address balance of payments imbalances. These imbalances were primarily caused by the 1970s oil crisis. Additionally, A government imposed a levy on bauxite caused producers to “down scale” bauxite production, resulting in decreased revenues. In an attempt to maintain its previous spending levels, Government responded by borrowing from the central bank and extra-regional financial institutions.

    In 1975, Jamaica had US$120M in reserves, which were significantly reduced to US$30M in 1977, until the island “ran out” of reserves. Government imposed a series controls aim at stemming the outflow of reserves, resulting in a “large parallel foreign exchange market.” Unfortunately, government was forced to devalue the Jamaican dollar. During the 1980s, Jamaica was faced with a severe foreign exchange crisis, social and political tensions, a decrease in output and increasing levels of inflation.

    Between the end of 1987 and May 1988, the Jamaican dollar had been devalued by 95%, and continuing into 1990s, the currency was repeatedly devalued in an effort to improve on the competitiveness of domestic exports. In addition, the external debt steadily increased throughout the 1980s to as high as US$4.5B, or 125% of GDP, in 1989.

    Barbados’ present economic situation is by far different from that of Jamaica, at that time……the variable are completely different…..

    ……………and Jamaica’s dollar was devalued BEFORE the island sought assistance from the IMF.

    Therefore, to suggest that the IMF will “guide” Barbados along a similar path to that of Jamaica is ludicrous.

  5. Mariposa Avatar
    Mariposa

    Rover up !there is enough blame to go around but it is presumptous of u to expect the dlp supporters to sit with closed mouth as you and other blp yardfowls poised a false narrative soley placing blame on the past govt when auditor general reports during the blp years of plenty highlited the blatant spending on projects and exposed the monies spent on inventory that was never received
    Yes there was also plenty corruption which gave cause for the blp to booted out of office for ten years

  6. David Avatar
    David

    @Artax

    You forgot to add that the IMF has reinvented itself from the early days.

  7. Mariposa Avatar
    Mariposa

    Sir tried posting an aricle this morning dated 2016 The IMF and the destruction of the Jamaica economy and it has not seen the light of day
    What you are presenting has nothing to do with a more current article
    So go sit yuhself down and come wheel again. Or ask David to post my article which he said when to spam ovet 8 hrs

  8. Guest Avatar
    Guest

    Any consideration to devalue the Barbados dollar should follow the recovery of foreign currency held by Barbadian individuals and companies in unauthorized overseas accounts. It would simply be unjust to contribute to a crisis and also benefit from it at the expense of others.

  9. David Avatar
    David

    This is an important point. In a market or economy in this instance where there is low or zero confidence flight of foreign exchange will take place. It is known ‘underground’ that a large number of Barbadians hoard US dollars in safety deposits or in Miami account. We have to restore confidence in the economy for people to cash in their US dollars and we have to increase penalties of anybody found with USD accounts on the outside.

  10. Guest Avatar
    Guest

    The Central Bank should also audit the disbursements of foreign currency in cash by the banks.

  11. Mariposa Avatar
    Mariposa

    David i dare u to go to the spam bucket and retreive the article i tried posting 3 times so readers can assessed and formed a decision out of biases

  12. Artax Avatar
    Artax

    These “alarmists” have conveniently or purposely chosen to forget that Jamaica has made significant progress in restoring economic stability since 2013, supported by an IMF Extended Fund Facility (EFF), which expired in April 2017.

    However, because economic growth fell short of the desired expectations and unacceptable levels of unemployment and poverty, the government cancelled the EEF and entered into a new 3 year Stand-By Arrangement(SBA) with the IMF. “The government intends to treat this new arrangement as precautionary and do envisage drawing on it unless unanticipated external shocks generate an actual balance of payments need.”

    It is reported that the economic progress Jamaica has achieved so far, they no longer need IMF financing because the island regained access to domestic and international capital markets.

    “With economic stability now restored, the loan supports the administration’s focus on achieving higher growth and jobs to help reduce poverty and improve the living standards of the Jamaican people.”

    Since 2013, Jamaica’s debt to GDP ratio has been reduced from 145% to GDP to approximately 120%.

  13. Well, Well Avatar
    Well, Well

    The downside to this dance with IMF…those who can legally do so, will leave their money off island until they see how and where this pendulum swings…

    ..those who are illegally hoarding money outside in foreign accounts, especially money stolen from pensioners and the treasury in various scams…should be hunted down and all their assets and accounts frozen..

    There are more than enough agencies with lots of resources to engage in this exercise.

  14. Mariposa Avatar
    Mariposa

    Ghee whiz who u trying to fool Jamaica debt is still a nightmare because of revolving loans from the IMF. Who wants to be indebted to a program and not see the light of day.Not to point out the socio decay that has become part and parcel from the IMF intervention
    I dare you to ask David to retreive the 2016article which i tried to post The IMF destruction of the Jamaica economy
    In which it was mentioned that Jamaica had to rely on China for financial support to rebuild its infrastucture while in the IMF support
    You blp yardfowls cant twist the truth about the IMF Program because small nation evidence says different

  15. Tron Avatar
    Tron

    @ millertheanunnaki June 3, 2018 8:30 PM

    Hyatt won´t be finalized before everything with IMF and creditors is settled.

    I also agree with Artax that there is no need for hysteria. The IMF did not only boost Jamaica, the IMF also tried to assist Barbados in the past – but Frundel himself refused. All the bad talk about the IMF is bullsh… Barbadians should fear the return of Chris Sinckler as Prime Minister, not an international club where the state of Barbados is a member of.

  16. Artax Avatar
    Artax

    Mariposa

    I recall reading the article re: “The IMF and the destruction of the Jamaica economy,” which was posted on-line by “GlobalBlog” on January 11, 2016.

    From the second paragraph of the article states the following:

    “The economy within not only Jamaica, but the whole of the Caribbean is in dire shape, and has been for decades. Over the past 40 years, several of the islands have turned to the International Monetary Fund, cap in hand, asking for help. Jamaica was the first to do so in 1977. Jamaica’s need for assistance came during the oil crises of the seventies, and despite then Prime Minister Michael Manley’s best attempts at resistance, even declaring that Jamaica was “not for sale”, he had to give in.”

    “The harsh realities of the oil crises and falling revenues within the bauxite industry had all but forced Manley to apply for the country’s first of many loan agreements, leading to what academic Thomson Fontaine described as an “almost uninterrupted” stream of support for nearly two decades. Four decades removed from Jamaica becoming the first nation to sign up for a loan, it is still struggling and dependent on regular agreements from the International Monetary Fund, to stabilise its economy.”

    Then the author goes on to give a brief description of the IMF and its “precursor,” the Bretton Woods Fund……..

    ………. in addition to a synopsis of Jamaica’s relationship with the IMF during the 1970s to 1990s…and how the IMF related policies during those times may have been responsible for “the destruction of the Jamaica economy.”

    It is “BLATANTLY CLEAR and OBVIOUS” that YOU DID NOT READ THE ARTICLE you attempted to post.

    If you had ACTUALLY READ the article:

    (1). You would have NOTICED the SIMILARITIES between the information I posted and the information presented in the article. Or perhaps you may want to indicate the differences.

    (2). You would NOT have written: “What you are presenting has nothing to do with a more current article.”

    Perhaps you’re suggesting that, despite the information being similar, because the article is dated 2016, it is more recent?

    Or, because you saw references made to the 1970s and 80s, you interpreted my information as not being recent?

    My friend, you continue to prove my assessment of a political yard-fowl is correct……similarly to how you continue to prove Galileo wrong.

    “So go sit yuhself down and come wheel again.”

  17. Mariposa Avatar
    Mariposa

    Thanks David for posting the link .The IMF and the destruction of the Jamaica economy
    Better late than never

  18. Mariposa Avatar
    Mariposa

    My friend u might be of superior intellect . .However the article gives a dire state of continual economic affairs which Jamaica is still dealing with after 40years in the IMF program
    All one has to do is read the reports of social deprivation coming out of Jamaica a country that was supposed to see a positive difference after the IMF took over
    It is obviuos the govt was left standing holding the worst end of the socio enviroment bag in its effort to stay the course directed by the IMF in order to pay its debt

  19. Artax Avatar
    Artax

    No, please, madam……I’m not “of superior intellect”……ask Hal Austin……he has proven otherwise and brought me to the realization that I’m “appallingly ignorant.” (And you characterizing me as such, may unfortunately cause Hal [the REAL INDIVIDUAL of superior intellect] to rupture a blood vessel).

    However, you are misrepresenting the facts, perhaps because of your limited knowledge of these issues.

    As I previously stated, the economic circumstances that caused Jamaica to seek financial assistance from the IMF were completely different from what Barbados is presently experiencing.

    Therefore, it is ludicrous for you to use Jamaica’s experiences as an example for Barbados……….

    ………especially in the ABSENCE of information relative to any proposed arrangement Barbados may enter with the IMF.

    In other words you DO NOT have ANY DETAILS on what a Barbados/IMF arrangement would entail…….yet you are PREPARED to suggest that, under an IMF program, Barbados will suffer a fate similar to that of Jamaica.

    And can’t you indentify the folly in your argument?

  20. akenatenI Avatar
    akenatenI

    https://youtu.be/PROuxJoE-WM

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