Several Caribbean countries to get debt relief from IMF and World Bank

Several Caribbean Community (CARICOM) countries have been included in 76 countries named by the International Monetary Fund (IMF) and the World Bank for a suspension of debt payments as a result of the coronavirus (COVID-19).

IMF and World Bank plan to suspend debt payment for some countries. (Photo: 112.international)

In a joint statement, on Wednesday, the IMF and the World Bank said that they have made representation to the G20 countries concerning debt relief for the poorest countries.

“The coronavirus outbreak is likely to have severe economic and social consequences for IDA countries, home to a quarter of the world’s population and two-thirds of the world’s population living in extreme poverty.”

“This will help with IDA countries’ immediate liquidity needs to tackle challenges posed by the coronavirus outbreak.”

— Joint statement from IMF and World Bank

Among the IDA countries named by the two Washington based financial institutions are Dominica, St Vincent and the Grenadines, Grenada, Guyana, Haiti and St Lucia.

They said eligibility for IDA support depends first and foremost on a country’s relative poverty, defined as gross national income (GNI) per capita below an established threshold and updated annually at US$$1,175 in fiscal year 2020.

“IDA also supports some countries, including several small island economies, that are above the operational cut off but lack the creditworthiness needed to borrow from the International Bank for Reconstruction and Development (IBRD).”

The IMF and the World Bank said that “with immediate effect, and consistent with national laws of the creditor countries, “the World Bank Group (WBG) and the International Monetary Fund call on all official bilateral creditors to suspend debt payments from IDA countries that request forbearance.

“This will help with IDA countries’ immediate liquidity needs to tackle challenges posed by the coronavirus outbreak and allow time for an assessment of the crisis impact and financing needs for each country.”