Despite a “virtual standstill in tourism” resulting from the coronavirus pandemic and the constraints that it has placed on travel, the International Monetary Fund (IMF) is reporting that the Caribbean Community (CARICOM) member state, Barbados, has made “good progress in implementing its Economic Recovery and Transformation (BERT) plan to restore fiscal and debt sustainability, rebuild reserves, and increase growth.”
Last week the IMF reported that while the pandemic had resulted in a virtual standstill in the tourism sector and a consequential 18% contraction in the country’s economy last year, international reserves had, with the support of IMF loans, increased to US$1.3 billion at the end of March this year. “This, and a successful 2018-19 public debt restructuring, have helped rebuild confidence in Barbados’ macroeconomic framework.
The report noted however, that while the country was successful in containing the outbreak of the COVID-19 pandemic last year, a surge in cases earlier this year had led to the country’s second national lockdown in February.
The IMF is making a cautious prediction of a likely 3% growth in the Barbadian economy this year, though it says that this is premised on a modest recovery of tourism in the second half of the year. The Fund says, however, that going forward, the outlook remains “highly uncertain,” though it adds that the risks are elevated in the light of the possible knock-on impact of the recent volcanic activity in St Vincent and the Grenadines.