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Antigua & Barbuda will not re-engage with the IMF – Finance Minister
The Spencer administration in Antigua & Barbuda, has revealed that it does not have any intention of re-engaging the International Monetary Fund (IMF), even after the Washington-based financial institution said the twin-island nation had successfully completed a multi-million dollar Stand By Agreement despite “considerable challenges”.
However, the Finance minister, Harold Lovell indicated that Antigua & Barbuda would “maintain a relationship” with the IMF.
“I have said it before in another forum but it is worth repeating, Antigua & Barbuda is at the dawn of a new era. We weathered the worst of the storm presented by the global economic and financial crises, as well as home grown realities like the collapses of BAICO/CLICO and R. Allen Stanford.
He said when the twin island-nation entered into the 36 month IMF program as art of the National Economic and Social Transformation (NEST) Plan “ I am certain we all understood that we had to chart a new and very different economic and fiscal path, there was fear.
“Some of that fear came from a combination of the unknown coupled with yesteryear experiences. There was also serious and deliberate fear mongering,” he added.
Last week, the IMF said the country would receive an immediate disbursement of US$25.4 million following the last review of the stand by agreement which expired on June 6.
The 36-month stand by agreement was approved on June 7, 2010 for an original amount of US$121.9 million and the IMF said that the aims of the program were “largely achieved despite considerable challenges”.
It said the fiscal deficit dropped from 18 percent of gross domestic product (GDP) in 2009 to just over one percent last year.
The IMF said that much of the adjustment under the program has come from cuts in public spending and investment, while tax revenue targets for 2013 have been met largely through one-off payments of back taxes.
“Another risk looms in the expiration of debt relief and upcoming payments due to foreign creditors. Further improvements in the collection of tax revenues are necessary to allow the authorities to meet their targets and while making needed public investment. In particular, the elimination of tax exemptions and a broadening of the tax base could help.”
The IMF said it had also approved Antigua & Barbuda’s request for a waiver of non-observance of the performance criterion on the central government budget expenditure arrears accumulation.
It said the waiver was granted on the basis of the temporary and minor nature of the deviations from the program objectives and the corrective measures undertaken by the authorities.
After the expiration of the stand by agreement, Antigua & Barbuda and the IMF will continue to maintain a constructive policy dialogue.
According to Minister Lovell, Antigua & Barbuda can now move forward with renewed confidence that the twin-island nation is on the path to economic recovery. -(CMC)