New loan approved for Dominica

Sunday, February 1, 2004

ROSEAU, Dominica: Less than three weeks after the International Monetary Fund (IMF) approved a US$11.4 million credit for Dominica, the Government of Dominica has learnt that on January 29th 2004, the World Bank approved a US$3 million structural adjustment loan for Dominica.

The resources made available from the IMF and World Bank are part of a package of budgetary support resources from the donor and Caribbean communities in support of Dominica's ongoing programme of economic stabilization and adjustment. 

The approval of these very soft loans by the world's premier international financial institutions reflect a significant vote of confidence in the comprehensive economic programme being pursued by the Government to rescue the country from an economic and fiscal crisis brought on by years of previous neglect and mismanagement.

The next critical components of the ongoing programme involve:

• restructuring of the country's very burdensome public debt;

• rationalizing of the public service with a view to greater efficiency and cost reduction, leading to the closing of the fiscal gap;

• continuing structural reform with a view to continuing to lay a platform for economic growth.

An essential premise of the economic programme being pursued by the Government is that if the fiscal crisis is allowed to go unattended, it will forever constrain the country's ability to grow, so that economic stabilization is an essential prerequisite for growth.

At the same time, the Government is continuing to pursue vigorously its public sector investment programme while facilitating private investment to the fullest extent.

When the figures become available, they are expected to reveal a reversal in the declines in economic growth that characterized the previous two fiscal years.  

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