THE INTERNATIONAL MONETARY FUND (IMF) should not be ruled out as an option to help Barbados.
However, Central Bank Governor Cleviston Haynes said Government had to decide if that was the option it wanted to pursue.
Yesterday in a statement on its 2017 Article IV Consultation with Barbados, the IMF’s executive board said “a stronger macroeconomic framework and bolder structural reforms are needed to achieve fiscal and debt sustainability, address the large financing needs, build adequate international reserves, and boost growth”. In the recent past, the IMF also offered its assistance to Barbados.
Speaking during his review of the economy’s performance last year, Haynes said: “We need foreign exchange to drive this economy forward and the IMF has always been an option that is available to the Government.
“One of the advantages of the IMF approach is that it helps to unlock resources from other financial institutions, possibly also from the private sector. So it is in that respect there are advantages in taking an approach to the IMF.”
He stressed that it was a decision which the Government “will have to consider and to take”.
“What we need, I think, is to be able to move quickly in order to boost our reserves. That to my mind is where we have to focus. We cannot allow our reserves to continue to decline. Therefore, we have to work towards getting those capital flows that will enable us to rebuild the reserves to the levels which people feel comfortable [with].”
Haynes also said the Central Bank would continue to minimise the printing of money to finance Government, another issue the IMF raised concern about yesterday.
“There are some underlying structural issues over and beyond the Central Bank lending that have to be addressed. Clearly one of them is to address the fiscal deficit, but we also have to recognise there is a high level of foreign debt service which we have independent of the debt itself,” he added. (SC)