IMF staff concludes visit to Barbados

• Barbados’ economy continued to recover strongly in 2023, with economic growth estimated at 4.4 percent, driven by tourism and related sectors.
• Implementation of the Barbados Economic Recovery and Transformation (BERT 2022) program remains strong, supported by the IMF’s Extended Fund Facility (EFF) and Resilience and Sustainability Facility (RSF).
• Program targets under the Fund-supported program for end-December 2023 were met and structural benchmarks were implemented. International reserves rose to US$1.5 billion.

BRIDGETOWN, Barbados – An International Monetary Fund (IMF) team led by Michael Perks visited Barbados between February 26-29, 2024 to review recent economic developments and reform efforts and prepare the ground for the third review of the Extended Fund Facility (EFF) / Resilience and Sustainability Facility (RSF) programs. 

To summarize the mission’s findings, Perks made the following statement:

“Economic activity in Barbados continued to recover strongly in 2023, driven by tourism and related sectors. Real GDP expanded by an estimated 4.4 percent, reaching its pre-pandemic level. Annual inflation remained broadly stable, despite easing international food prices, on account of adverse weather conditions reducing the supply of certain crops and higher prices of dining and other goods and services. The current account deficit is estimated to have narrowed to 8 percent of GDP (from 10.7 percent in 2022).

“The authorities continue making strong progress in implementing their ambitious economic reform program. Indicative targets for end-December 2023 under the EFF were met. International reserves rose to US$1.5 billion, equivalent to 7.3 months of imports. Strong fiscal performance through the first three quarters of FY2023/24 bodes well for meeting the 3.4 percent of GDP primary balance target for the full fiscal year. Preparation of a budget for FY2024/25 is well underway.

“Important steps are being taken to advance the structural reform agenda. End-December structural benchmarks aimed at the reform of state-owned enterprises have been implemented. Work is also underway on reforms to strengthen tax administration, public financial management, and the business environment, while also building resilience to climate change under the RSF. Meanwhile, the significant progress made in strengthening the AML/CFT framework has enabled Barbados to exit the Financial Action Task Force grey list.

“The team is looking forward to conducting discussions for the third review under the EFF and RSF in May and would like to thank the authorities and their technical team for their hospitality, openness and candid discussions.”

IMF Communications Department