Above: Charlestown, Nevis (CJ Photo)
By the Caribbean Journal staff
St Kitts and Nevis met all of the International Monetary Fund’s quantitative performance criteria at the end of December in addition its structural benchmarks, according to George Tsibouris, head of the IMF’s mission to the federation.
The country said the tests were accomplished “despite global economic headwinds continuing to hamper economic activity, particularly in construction and tourism,” Tsibouris said.
St Kitts and Nevis similarly passed its September tests.
“The debt restructuring process, planned to restore debt sustainability, is well underway,” he said. “The debt exchange tender was recently concluded with almost universal participation by both domestic and external creditors.”
The IMF and the country have now agreed on a draft memorandum of economic and financial policies that reaffirms fiscal targets set out in the 2012 budget, according to the IMF, as well as structural benchmarks for 2012.
Those include drafting and enacting new procurement legislation, the rationalization of the subsidy on liquefied petroleum gas and the strengthening of social safety nets.
The Mission recommended completion of the second review under the Stand-By Arrangement, which it is expected to discuss at the end of May.
“The authorities remain firmly committed to the policies and objectives of their home-grown economic programme, and are keenly aware of the benefits of strong microeconomic policies in achieving fiscal and debt sustainability,” Tisbouris said. “Nonetheless, there are still challenges ahead, including the continued weakness in the global economic environment.”
The IMF said continued vigilance and “steadfast implementation of the government’s policy framework” would be critical to establishing conditions for higher growth.
During the review, the mission held meetings with Prime Minister Dr Denzil Douglas, Nevis Premier Joseph Parry and members of the federal cabinet and the cabinet of the Nevis Island Administration, among others.