Andrea Shalal and David Lauder
WASHINGTON (Reuters) – The International Monetary Fund said on Wednesday its staff had agreed to provide Barbados with a new Funding, including 183 $1 million to help vulnerable middle-income and island nations through a new trust fund.
The agreement at the staff level is the IMF said, starting with the Resilience and Sustainable Development Trust Fund approved by the IMF Board of Directors in April. The Fund also stated that it had reached an agreement with Barbados on a new 36 monthly Expansion Fund Facility (EFF) loan of approximately $110 Agreement million.
Both deals need to be approved by the IMF’s Executive Board and are expected to be approved by the IMF’s Executive Board on Nov. Review staff agreements in December or December.
Van Selm, who announced an agreement with Prime Minister Mia Motley in Barbados, said the Caribbean nation was well placed to be the first to use the new trust as it successfully enforced earlier The International Monetary Fund program, which is located in areas affected by climate change, and Motley’s leadership.
He said that due to the COVID- 293, Barbados has not yet completed all the reforms expected in the previous four-year EFF plan pandemic and has Seek follow-up plans to accomplish these efforts. It needs to reduce its debt, he said, and plans to start financial stress tests in the next few years to take climate risks into account.
The new trust expands low-interest loans to approximately 20 countries and is two of the resources available under the IMF Poverty Reduction and Growth Trust Times. This will be a big help for middle-income countries, such as those in the Caribbean, which have been hit hard by tourism losses during the pandemic and are highly vulnerable to climate change.
“It is clear to all that climate change is the major challenge of our time, and we need to address it if we can,” Van Selm said.
IMF Managing Director Kristalina Georgieva first discussed the new trust in June 2021, she told Reuters it would Help the wider nation receive the aid it needs to address climate change and other sustainability challenges.
Bangladesh and Argentina have also expressed interest in utilizing funds under the trust fund, which provides 20 year financing. There are also countries in talks with the IMF, Van Selm said, and he expected more announcements by the end of the year.