IMF: New instrument to help build resilience

Managing Director of the International Monetary Fund (IMF), Kristalina Georgieva, on Tuesday night said the establishment of a new instrument, the Resilience and Sustainability Trust, will help countries build economic and climate change resilience.

Speaking at the Grantley Adams International Airport minutes after her team arrived for talks with Barbados Prime Minister Mia Mottley and her team, Georgieva said this was something for which the latter had advocated.

“Prime Minister Mottley for years has been arguing the IMF and other financial institutions should provide concessional financing on the basis of vulnerability of countries, not just income levels, and now what you have been advocating for Prime Minister, is finally a reality,” she said.

Additionally, she said, the IMF was for the first time offering long maturity and grace period for countries in its programmes.

In response, Mottley was thankful the institution understood the challenges nations such as Barbados faced.

“The response with the establishment of the Resilience and Sustainability Trust is evidence that the IMF not only has recognised the problem, but it cares enough to put an instrument in place to meet the needs of these countries that are on the frontline of the climate crisis,” the Prime Minister said.

Georgieva is the first managing director of the IMF to visit this part of the Caribbean.

“Why this visit is so important to us at the IMF, because as we all know, the world is faced with tremendous challenges and they are hitting Barbados and other countries in the Caribbean hard.

“We had the pandemic impacting tourism dependent economies dramatically and now we have a crisis on top of a crisis with the war in Ukraine pushing energy and food prices up. With inflation threatening the incomes of people, with the economies still struggling to recover from the pandemic, it is so important that we all do our best to support the countries and the people here,” Georgieva said.

She told Mottley countries needed to not only build resilience for now, but for future shocks, and that is where the IMF can assist as “steadfast partners of the Caribbean”.

“We worked with Barbados to build economic resilience. It paid off when the [COVID-19] pandemic hit because the country was much better protected. We want to build on that for the future.”

Meanwhile Mottley said the region was facing a triple crisis – climate change, the pandemic and now the war in Ukraine – which has compounded an already bad supply chain problem. And Barbados, like other countries, was “facing and reeling from the increase in fuel and food prices in the world”.

She said the parties must come together to determine “how we can continue to shield our people, while at the same time reinforcing the economic fundamentals that would lead to growth, because ultimately, it is only growth that will take us out of this condition”.

Georgieva said they would also hold discussion with policymakers from other Caribbean countries later this week. (SAT)

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