Bdos: Beware the economy-killer IMF

BARBADOS’ public debt at $3.9 billion is too high, and rising, and the International Monetary Fund (IMF) wants it to come down.

And the Fund is also concerned about the decline in transparency in Government’s fiscal operations in recent years, particularly high extra-budgetary spending, mainly in transfers to public enterprises.

In its Executive Board Assessment following the conclusion of the 2004 Article IV Consultation published this past weekend, the IMF observed that the economy had begun to recover from the 2001-02 recession, led by the strong performance of tourism and supported by the countercyclical fiscal stance adopted in the downturn.

“However, this fiscal stance gave rise to a substantial increase in the Government debt,” it noted, “which must now be reversed.