Jul 2018 Financial News

Barbados Debt Restructure

Jul 18, 2018

Barbados Government releases statement updating the status of the debt restructuring and economic plan:

• The government will, wherever possible, seek to accommodate creditors who have indicated a preference for principal preservation by incorporating both discount and par solutions into a future exchange offer to be launched once a broad consensus on restructuring terms is reached.
• Majority of creditors have identified themselves and “expressed willingness to work with Barbados in good faith in addressing the unsustainable debt burden that the current administration has inherit
• The government wishes to commence a dialogue with its creditors over the types of terms that will be required to eliminate the financing gaps that are likely to remain even after the planned fiscal correction and the associated support from international financial institutions is factored in

Government met with team from IMF during July 2-12

 “Through this consultative process, the Government expects to finalize a detailed package of revenue- and expenditure-side measures that will have broad-based social support, and form the
basis of a Staff-Level Agreement with the IMF, ahead of Executive Board review”

Government releases preliminary growth and fiscal projections:

GDP growth of 3.5% est. for 2018, 3.3% next year, rising to 4.0% in 2020

Primary surplus of 3.2%/GDP est. for 2018, rising to 6.0%/GDP next year

The proposed fiscal trajectory marks a material departure from the unsustainable fiscal stance of the last 10 years, and is intended to restore public finances to a sustainable footing in conjunction with the forthcoming debt restructuring”


Source:
Bloomberg
Wednesday July 18, 2018