Staff of the IMF and World Bank conducted reviews of the Barbados economy and the financial system in 2013, and the reports of the staff were discussed at a meeting of the Board of Directors of the IMF on Monday February 10.
This morning the IMF issued a Press Release reporting on that meeting, along with the Fund???s Staff Report on Barbados, the Financial Sector Stability Assessment (FSSA), and a statement on behalf of the Barbados authorities, by the representative of the Executive Director for Barbados at the IMF.
The IMF acknowledged that the Barbadian authorities have recognised the need for urgent action, and that the announced measures, if fully implemented, would serve to lower the fiscal deficit to 4.9 percent of GDP by fiscal year 2014/15, and would help to restore stability to external flows.
The IMF???s recommendations are in line with the policies announced by Government, and are being implemented.
a) Revenue administration is being strengthened with the establishment of the Barbados Revenue Authority;
b) Non-statutory revenue exemptions which do not support foreign exchange earning sectors or support the society’s most vulnerable are being reduced;
c) The public sector wage bill is being reduced as a result of the layoffs and a programme of attrition;
d) A medium-term strategy for the further reduction in the fiscal deficit remains in place;
e) The Central Bank of Barbados’ lending to Government will be reduced as the lower deficit is funded from domestic liquidity;
f) Monitoring of the financial system is being intensified in line with the recommendations of the FSSA;
g) Improved business facilitation and higher labour productivity are at the core of the Barbados growth strategy.
The Barbados authorities appreciate the full and frank discussions with the teams that prepared the Staff Report and the FSSA.
They look forward to the ongoing assistance of the IMF, including through the Caribbean Technical Assistance Centre, with the implementation of the above measures.