Prime Minister of Barbados Calls for Urgent IMF Reform to Support Debt Sustainability
Prime Minister Mia Amor Mottley has issued a powerful call for the International Monetary Fund (IMF) to reform its lending arrangements for middle-income countries.
In a compelling commentary, Mottley highlights the escalating debt challenges facing developing economies, especially amidst the climate crisis, and criticizes the IMF’s current surcharge regime, which has become unsustainable due to rising global interest rates.
Mottley emphasizes that the IMF’s surcharge system, introduced to curb excessive borrowing in past crises, is now outdated and exacerbates financial strain on vulnerable economies.
She urges the IMF to either overhaul the surcharge structure, considering the interest rate cycle, or eliminate it entirely.
Furthermore, Mottley advocates for extending the repayment period of the Extended Fund Facility (EFF), noting that its current framework is insufficient for addressing long-term structural reforms.
She points to recent innovative IMF initiatives, such as the Resilience and Sustainability Facility, as examples of the Fund’s capability for progressive change.
As middle-income countries grapple with multifaceted crises, Mottley calls for lending arrangements that better support sustainable development and climate resilience, urging the IMF to undertake fundamental reforms to align its support with the current global economic landscape.
