November 3, 2018 |
After the Barbados Labour Party (BLP) swept the general elections in May, taking all 30 seats in the House of Assembly, the new prime minister, Mia Mottley, unveiled a hefty debt restructuring plan that involved suspending payments to external creditors. “We needed to stabilize the country and stop the bleeding,” she said in her first interview as prime minister with the international press.
According to the BLP, the cash-strapped Caribbean island had $220 million in international reserves, just enough to cover seven weeks of imports, while public debt had reached roughly 175% of GDP.
Like many of its island neighbors, Barbados cast aside fiscal discipline after the 2008 global financial c
Barbados is preparing for a painful journey back to fiscal health with
help from the IMF, but international bondholders don’t know how they
fit in the Caribbean island’s restructuring efforts.