BRIDGETOWN, Barbados , May 14, CMC — The International Monetary Fund (IMF) and the government of Barbados have reached a staff-level agreement on a 36-month precautionary Stand-By Arrangement (SBA) valued at SDR 189 million, or approximately US$260 million.
The agreement, which remains subject to approval by the IMF Executive Board in June, is intended to provide Barbados with financial protection against external shocks while supporting the country’s ongoing economic reform agenda under the Barbados Economic Recovery and Transformation Plan 2026 (BERT 2026).
According to the IMF, the new programme represents the next phase of Barbados’ economic reform efforts, shifting focus from economic stabilisation and recovery toward long-term transformation, resilience and inclusive growth.
In a statement issued at the conclusion of an IMF mission to Barbados, mission chief Michael Perks said the arrangement would “provide insurance against external shocks, while continuing to anchor macroeconomic stability and support reforms under the homegrown BERT 2026 Plan.”
“The latest phase of the BERT Plan focuses on economic transformation, with emphasis on boosting productivity and competitiveness, strengthening fiscal sustainability, deepening financial markets, strengthening human capital, and enhancing climate resilience,” Perks said.
The IMF noted that Barbados enters the proposed arrangement from a position of stronger macroeconomic stability, with economic growth estimated at 2.7 per cent in 2025, driven largely by tourism, construction and business services.
Inflation moderated to an average of 0.9 per cent, while gross international reserves remained strong at approximately US$1.5 billion at the end of 2025 — equivalent to about six months of imports.
Fiscal performance also remained robust, with the fiscal primary surplus reaching 4.2 per cent of GDP during the 2025/26 financial year.
“Guided by sound macroeconomic policies, economic activity remained robust in 2025,” Perks stated, adding that Barbados had also successfully returned to international capital markets last year.
Despite the positive outlook, the IMF warned that Barbados remains vulnerable to global uncertainties, including higher commodity prices, policy uncertainty and the threat of natural disasters.
“External conditions are expected to normalize thereafter, but the outlook remains subject to unusually high uncertainty, with risks tilted to the downside,” the IMF said.
The proposed SBA is expected to support continued fiscal discipline while allowing government to maintain investments in infrastructure, climate resilience and social protection.
The IMF also stressed the importance of continued structural reforms, including improvements in public financial management, state-owned enterprise oversight, revenue administration, climate resilience, and financial supervision.
The IMF team visited Barbados from May 4 to 14 as part of the country’s 2026 Article IV Consultation and discussions surrounding the new BERT 2026 reform programme.
Perks thanked Barbadian authorities for what he described as a “constructive and candid policy dialogue” during the mission.
