(CNS) – Former prime minister Owen Arthur says Barbados should look towards the International Monetary Fund (IMF) to help turn around the ailing economy, saying the Washington-based financial institution “has changed its ways and now enables countries to have what is called flexible credit lines”.
In what is probably his last presentation to a budget debate here, Arthur, the island’s longest-serving prime minister, told legislators that the so-called home-grown Barbados Sustainable Recovery Plan (BSRP) should be the catalyst for funding from the international lending agency.
Arthur urged the Freundel Stuart government not to be afraid of the IMF anymore, since the lending agency now had a flexible credit line that has benefited other Caribbean states, all with economies that are growing fast.
“The International Monetary Fund would have in the past related to countries entirely on the basis on financial quantitative targets. It has changed its ways and now enables countries to have what is called flexible credit lines.
“I sat with the government of Grenada for a weekend when they had to prepare a programme with the International Monetary Fund and helped them to structure a programme with the Fund to fit into the new approach that the Fund has to lending countries . . . and you have a situation now where the countries in the Caribbean that are growing the fastest are those that are using flexible credit lines with the International Monetary Fund,” he told legislators as he contributed to the debate on the Estimates of Expenditure and Revenue presented earlier this week by Finance Minister Chris Sinckler.
Arthur, a parliamentarian for the past 35 years, said the government needed to face up to the reality that the International Monetary Fund (IMF) was the answer to their economic problems.
Arthur, an economist, said that once this was done, it would serve as an injection into the revenue stream that could “stop the body from being at rest and would be the factor that would allow you to be able to start to grow”.
He told legislators that the Grenada initiative was based on a home-grown programme similar to the BSRP.
“The government of Barbados now has a home-grown programme . . . that could be the basis of something to be put before the Fund as the Government’s approach to rescuing the Barbados economy to be tweaked after further consideration with the International Monetary Fund,” Arthur said.
He noted the concerns of law makers that the recovery plan had been presented to the Parliament at the last minute, saying if the government was using IMF special drawing rights or talking to the Fund about a programme, and if it wanted the recovery plan financed by that institution, a wide discussion should be held on the matter.