IMF approves COVID-19 funds for 3 Caribbean nations

The International Monetary Fund (IMF) approved the requests from 3 Caribbean nations for a COVID-19 emergency financial assistance.

IMF’s Executive Board approved a total of SDR 48 million (US$65.6 million) disbursements to Dominica, Grenada, and St. Lucia following requests under the Rapid Credit Facility (RCF) mechanism.

The 3 Caribbean nations are deemed very vulnerable to natural disasters, with Dominica still recovering from the devastation of Hurricane Maria in 2017.

Disbursements to all three countries are set at the maximum available access under the RCF instrument of 100 percent of quota for Grenada (SDR 16.4 million or US$ 22.4 million) and St. Lucia (SDR 21.4 million or US$ 29.2 million), and 89.4 percent of quota for Dominica (SDR 10.3 million or US$14 million).

The funding is expected to support macroeconomic stability, facilitate the subsequent recovery and cover balance of payment needs affected by the outbreak of the COVID-19 pandemic.

Mr. Tao Zhang, Deputy Managing Director and acting Chairman of the IMF said that they are ready to support the 3 Caribbean nations.

“The COVID-19 pandemic poses a major challenge to Dominica, Grenada, and St. Lucia. Their key tourism sectors have been hit hard by the shock. The contraction in tourism is expected to have a major impact on their economies, by causing ripple effects across all economic sectors, eroding fiscal revenues, and creating an urgent balance of payments pressures. In addition, these three small states are also highly vulnerable to natural disasters.”

“Fund financing will help catalyse further donor support to close the remaining balance of payments needs. The IMF will continue to be engaged with Dominica, Grenada, and St. Lucia, and stands ready to provide policy advice and further support as needed.”

(Read Mr. Tao Zhang’s full statement here)

Dominica, Grenada, and St. Lucia are members of the Eastern Caribbean Currency Union (ECCU).

In other news:

Grenada authorities have ordered the shut down of the country’s lone flour mill, due to COVID-19.