Barbados on Tuesday became the first country to secure a financing package from the International Monetary Fund’s (IMF) new lending fund, aimed at helping low-income countries dealing with the impacts of climate change.
A team from the Washington-based entity agreed with the country’s government to insulate a US$183 million financing package through the Resilience and Sustainability Fund (RST), launched this year.
The proposed agreement “will provide funding to support the country’s climate change adaptation and mitigation efforts, and support Barbados’ ambitious goal of a full transition to a renewable energy-based economy by 2030,” said Bert van Selm, who headed the IMF mission to Barbados this week.
The country still needs IMF management approval and must negotiate a more traditional program, as determined by the conditions of the RST fund.
Barbados has applied for a three-year grant of $110 million under an extensive facility fund to accompany the other funding, Van Selm said in a statement.
“Barbados continues to face economic challenges due to the global pandemic and high world raw material prices, but the recovery is now well underway,” he said.
The aid programs will support the country’s reform efforts, including reducing public debt, while boosting economic activity.
The IMF seeks to mobilize $45 billion from the RST fund with contributions from member countries and provide long-term loans to support low- and middle-income countries eligible for this funding.
