Above: Grenada

By the Caribbean Journal staff

The government of Grenada and the International Monetary Fund have reached a staff-level agreement, the IMF announced.

The economic programme will be supported by a three-year, $21.9 million extended credit facility, according to the IMF.

“The main objectives of the program are to restore fiscal and debt sustainability, boost long-term growth through structural reforms, and safeguard the resilience of the financial sector,” said Aliona Cebotari, the IMF’s mission chief for Grenada, in a statement.

The agreement is still subject to approval by the IMF’s executive board.

“The cornerstone of the program is a strong fiscal adjustment focused on curbing current spending and widening the revenue base, while maintaining space for infrastructure spending and social safety nets. The fiscal adjustment will be complemented by a comprehensive debt restructuring, which will aim to secure meaningful debt reduction, address financing shortfalls, and put Grenada’s public debt firmly on a downward path towards the Eastern Caribbean Currency Union (ECCU) regional target of 60 percent of GDP by 2020,” Cebotari said.

Grenada’s government said the deal would pave the way for the country to access “at least $100 million in grants and soft loans from donors and friendly countries.”

Cebotari said the programme success would “require an extraordinary effort on the part of the authorities, other segments of the society, as well as broad international support.”

“While the initial implementation period will be challenging, Grenada will emerge stronger and more dynamic from the program, and it will be better poised to generate growth and job creation going forward,” she said.