IMF Staff Concludes Staff Visit to Barbados

IMF News, February 5, 2021

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The global coronavirus pandemic is causing a deep recession in Barbados.
The economy is estimated to have contracted by about 18 percent in 2020, with a gradual recovery projected to start in 2021.
Tourism arrivals remain at a fraction of normal levels.
Recent increases in COVID-19 cases in key source markets, including the US and the UK, will likely delay the recovery.
A recent outbreak of COVID-19 in Barbados led to an ongoing lockdown that will reduce economic activity in the first quarter of this year.

Implementation of the Barbados Economic Recovery and Transformation (BERT) program remains strong, despite the COVID-19 shock.
Program targets under the Fund-supported program for end-December 2020 were met.
International reserves reached more than US$1.3 billion at the end of December.
International reserves had reached a low of US$220 million (5-6 weeks of import coverage) at end-May 2018.

Strong steps have been made in implementing structural reforms under the program.
A new central bank law, aimed at strengthening the autonomy of the bank while limiting the provision of credit to the government, was adopted by parliament in December 2020.
An actuarial review of the civil service pension system was completed in November 2020, providing the basis for upcoming public pension reform.
A new procurement law to strengthen the fairness, integrity and transparency of the procurement process is expected to be submitted to parliament in February.

An IMF team led by Bert van Selm conducted a staff visit via videoconferencing between February 2-5, 2021 to discuss implementation of BERT, supported by the IMF under the Extended Fund Facility (EFF).
The team is looking forward to conducting discussions for the fifth review under the EFF in May.
The team thanked the authorities and the technical team for their openness and candid discussions.

Press Release No. 21/32 — IMF Staff Concludes Staff Visit to Barbados — February 5, 2021