Three Caribbean islands get COVID-19 relief funding from the IMF
Three Caribbean islands have been earmarked to receive funding from the International Monetary Fund (IMF) to aid in their fight against COVID-19.
The Executive Board of the International Monetary Fund (IMF) in a statement said disbursements have been approved for Dominica, Grenada, and St Lucia in response to their requests for funding under the Rapid Credit Facility (RCF) mechanism, which amounts to US$65.6 million.
The IMF statement said: “These countries are small states that are very vulnerable to shocks, including large natural disasters, with Dominica in particular still recovering from the devastation of Hurricane Maria in 2017. The pandemic has hit these largely tourism-dependent countries very hard. Tourism inflows essentially came to a halt in mid-March, 2020, with ripple effects across other sectors.”
The closure of borders coupled with the curtailment of commercial activity has had a debilitating impact on these economies.
According to the IMF, the drop in fiscal revenues, combined with additional direct health and social expenditures, will temporarily increase the fiscal deficit and financing needs.
The grants will help address some of these concerns, allowing governments to cushion the impact of the pandemic on the population by upgrading public health facilities and providing social assistance to the more vulnerable members of society.
Deputy Managing Director of the IMF Tao Zhang, said: “IMF emergency support under the Rapid Credit Facility will help fill the three countries’ balance of payments needs and create fiscal space for essential health expenditures, income support to workers, and cash transfers to households. Fund financing will also help catalyse further donor support to close the remaining balance of payments needs. The IMF will continue to be engaged with Dominica, Grenada, and St. Lucia, and stands ready to provide policy advice and further support as needed.”
No mention was made of Antigua and Barbuda.
In a letter dated March 30, Prime Minister Gaston Browne wrote to the IMF and the World Bank outlining the devastating impact of the coronavirus.
In the letter he asked both bodies to consider implementing measures to offer support to small and vulnerable economies.