WASHINGTON, USA – Barbados will strengthen its health and economic response to the COVID-19 crisis, support household income and business liquidity, and to define a social, economic and fiscal plan to reactivate its economy with a US$120 million loan from the Inter-American Development Bank (IDB). The IDB loan is for a 20-year term, with a 5.5-year grace period and an interest rate based on LIBOR.
The proceeds will be used to promote macro-economic stability and finance measures to address the pandemic, including the purchase of medicine, medical supplies and equipment.
Resources will also be used to support temporary measures to protect household income and provide businesses with working capital as the pandemic continues to hurt the economy, especially tourism, one of the country’s biggest economic sectors.
The loan will also support the planning and design of fiscal and economic measures that will help the country recover in the post-pandemic period, including measures to simplify taxes, increase government revenues, control spending and improve tax management and customs enforcement capabilities.
The $120 million IDB loan is the first of a two-step program with Barbados to improve the efficiency and effectiveness of the country´s public policy and fiscal management in response to COVID-19 crisis, through the design and implementation of effective and fiscally responsible policy measures.