Financing for a raft of new policies

Government’s prudent management of the Barbadian economy has secured access to US$75 million, the second of four Policy-Based Loans (PBLs) from the Caribbean Development Bank (CDB).

On Monday afternoon, Prime Minister Mia Mottley inked the loan agreement with CDB President Dr Warren Smith who said the funds would help strengthen Government’s technical and institutional capacity in the areas of social policy analysis, research and planning, monitoring and impact evaluation, among others.

The second PBL comes more than a year after the bank provided Government with the first one, for the same amount, in October 2018. According to Smith, the approval was contingent on Government’s progress in implementing key reforms under the Barbados Economic Recovery and Economic Transformation (BERT) programme.

“We are very encouraged by the resolve and commitment of the Government of Barbados to the plans and targets of BERT and we are also very satisfied with the results so far, most recent being the successful conclusion of the external debt restructuring negotiations,” the CDB President said during the signing ceremony at the Prime Minister’s official residence.

He added: “This was no easy feat, but the Government’s perseverance paid off, whilst paving the way for more convincing and sustained economic recovery.”

Lauding the development as an “important milestone”, Smith said the second PBL would strengthen Government’s fiscal framework and, over time, provide a more enabling environment for private sector development. Nevertheless, he encouraged the Mottley-led administration to focus on strengthening social protection for the poor and vulnerable.

The CDB had set aside US$225 million to provide financial assistance to the country in four separate instalments, but the final two payments will only be approved by the bank’s Board if Barbados continues to demonstrate sustained commitments to economic reform targets.

The regional development bank has also released significant amounts of financing to assist key improvements at the Grantley Adams International Airport and the South Coast Sewage Project.

Prime Minister Mottley lauded the CDB for its continued support of the country’s economic recovery at a time when Government could not access concessionary funding from international lending agencies like the World Bank, because of its status as a middle-income country.

Acknowledging that Monday’s signing could not have been achieved without Barbados’ economic strides, she promised that members of her economic team would not sit back on their laurels but would focus more heavily on implementing social reforms as well.

“This Policy-Based Loan will go a long way towards helping us to continue the reforms. It is not all about sustainable growth; it is also about making sure there is equitable growth. For too long in this region, we have looked at growth in terms of percentages rather than in terms of prosperity of people,” she said.

The Prime Minister used the platform to once again express her disapproval with the reluctance of international development lenders to grant access to funding despite the prevalence of existential threats to small islands.

Following Hurricane Dorian’s devastation in parts of The Bahamas, in early September, the international community has started to shift its position in light of that Caribbean country’s inability to secure much needed financing from the World Bank.

“To believe that you can leave a small state alone against the vagaries of all of these international challenges, by reason of the arbitrary mechanism that bears no relation to reality, continues to be one of the injustices of the 21st century inherited from our independence days,” declared Mottley.

“In a matter of hours, or even 24 hours, the circumstances of many of the Caribbean Development Bank’s member countries can change. Therefore, to deny us the opportunity of being able to build out our societies is a travesty that must be corrected.”
kareemsmith@barbadostoday.bb