Bahamas seeking US$252M emergency IMF loan

The government of The Bahamas has applied to the International Monetary Fund (IMF) for US $252 million to support its ongoing COVID-19 response and budgetary operations.

The Ministry of Finance says that as a member country of the IMF, the government of The Bahamas has applied to take advantage of a low-cost emergency loan facility that is available to all member countries.

It was noted that the $252 million falls within the borrowing authorization approved in the Supplementary “Hurricane Dorian” Budget in February. The additional resources will support the government’s ongoing Coronavirus (COVID-19) response and other budgetary operations.

“This loan is not a structural adjustment facility. It does not involve the conditionality elements normally associated with the IMF facilities that most are familiar with. This facility is a low-cost option, with an interest rate of some 1.054 per cent that we are smartly availing ourselves to address our current needs,” said K. Peter Turnquest, Deputy Prime Minister and Minister of Finance.

“In a few days, we are going to present a new budget and it will continue to reflect the double impact of Hurricane Dorian and COVID-19. However, we have demonstrated that our approach to addressing these emergencies is to focus on the health and safety of Bahamians, social protection for the most vulnerable, and the need to sustain employment. These priorities will continue into the new budget, as we work to stabilize the domestic economy and plant the seeds of recovery. This loan facility assists us with meeting our existing obligations through the end of the fiscal year, as has been approved by Parliament during the Supplement “Hurricane Dorian” exercise,” Turnquest.

Since COVID-19, some 27 countries have accessed financial assistance using the IMF’s Rapid Financing Instrument (RFI), including other CARICOM countries. Member countries with stable debt can apply for this facility when they have had a major economic shock, such as those caused by wide fluctuations in commodity prices, natural disasters, or other emergencies – in this case COVID-19.

(Eye Witness News Bahamas)