Economic Growth Debt and Fiscal Adjustment: Barbados ...
Economic Growth, Debt, and Fiscal Adjustment: Barbados' Tripartite Challenge
Zubin Deyal Laura Giles ?lvarez Kimberly Waithe
Country Department Caribbean Group
POLICY BRIEF N? IDB-PB-310
February 2019
Economic Growth, Debt, and Fiscal Adjustment: Barbados' Tripartite Challenge
Zubin Deyal Laura Giles ?lvarez Kimberly Waithe
February 2019
Cataloging-in-Publication data provided by the Inter-American Development Bank Felipe Herrera Library Deyal, Zubin. Economic growth, debt, and fiscal adjustment: Barbados' tripartite challenge / Zubin Deyal, Laura Giles ?lvarez, Kimberly Waithe. p. cm. -- (IDB Policy Brief ; 310) Includes bibliographic references. 1. Debts, Public-Barbados. 2. Fiscal policyBarbados. 3. Economic stabilizationBarbados. 4. Barbados-Economic policy. I. Giles, ?lvarez, Laura. II. Waithe, Kimberly. III. Inter-American Development Bank. Country Department Caribbean Group. IV. Title. V. Series. IDB-PB-310
Copyright ? 2019 Inter-American Development Bank. This work is licensed under a Creative Commons IGO 3.0 AttributionNonCommercial-NoDerivatives (CC-IGO BY-NC-ND 3.0 IGO) license ( legalcode) and may be reproduced with attribution to the IDB and for any non-commercial purpose. No derivative work is allowed. Any dispute related to the use of the works of the IDB that cannot be settled amicably shall be submitted to arbitration pursuant to the UNCITRAL rules. The use of the IDB's name for any purpose other than for attribution, and the use of IDB's logo shall be subject to a separate written license agreement between the IDB and the user and is not authorized as part of this CC-IGO license. Note that link provided above includes additional terms and conditions of the license. The opinions expressed in this publication are those of the authors and do not necessarily reflect the views of the Inter-American Development Bank, its Board of Directors, or the countries they represent.
CET@
Economic Growth, Debt, and Fiscal Adjustment: Barbados' Tripartite Challenge
Zubin Deyal, Laura Giles ?lvarez, and Kimberly Waithe Inter-American Development Bank
Abstract Economic growth, public debt, and the government's fiscal balance are strongly intertwined. In Barbados, low growth and recurring fiscal deficits have led to rapid accumulation of debt, which at over 155 percent of GDP in 2017 and the first half of 2018, has been the highest in the Latin American and Caribbean region. In response, the Government of Barbados is carrying out a set of ambitious reforms, including a fiscal consolidation program and debt restructuring. Yet, given the important role of economic growth on the required fiscal adjustment and on the debt-to-GDP ratio, it will be key to ensure that the design and scope of the adjustment support a balanced approach, reducing debt without undermining growth. This paper reviews and explains the recent debt trajectory in Barbados. It then discusses the potential effects of real GDP growth on the debtto-GDP ratio and the required fiscal adjustment going forward. In so doing, it highlights the importance of a balanced approach between fiscal adjustment and growth stimulus for a sustainable debt path.
JEL Codes: E62, F43, H63, H68 Key Words: growth, debt, fiscal balance, Barbados, economic development, debt sustainability, fiscal adjustment, policy
1
Table of Contents 1. Introduction ................................................................................................................. 3 2. Literature Review ........................................................................................................ 4 3. Low Growth, Rising Debt and Barbados's Fiscal Reform ............................................ 5 4. The Drivers of Debt in Barbados ................................................................................. 8 6. Conclusion ................................................................................................................ 12
References ............................................................................................................... 14
Figures
Figure 1.1: Real GDP ..................................................................................................... 3 Figure 1.2: Debt-to-GDP ratios ....................................................................................... 3 Figure 2.1: The debt-to-GDP ratio and economic growth, 2015 and 2017....................... 4 Figure 3.1a: Real GDP growth, Barbados....................................................................... 6 Figure 3.1b: Fiscal and primary fiscal balances, Barbados ............................................. 6 Figure 3.2a: General government debt ........................................................................... 7 Figure 3.2b: Short-term and long-term domestic debt .................................................... 7 Figure 4.1: Cumulative drivers of debt ............................................................................ 8 Figure 5.1: Debt-to-GDP ratios projections ................................................................... 10 Figure 5.2a: Deviations in the 2027 debt-to-GDP ratio.................................................. 11 Figure 5.2b: Deviations in the 2033 debt-to-GDP ratio.................................................. 11 Figure 5.3a: Required primary surplus to reach 80 percent of GDP by 2027 ................ 12 Figure 5.3b: Required primary surplus to reach 60 percent of GDP by 2033 ................ 12
2
................
................
In order to avoid copyright disputes, this page is only a partial summary.
To fulfill the demand for quickly locating and searching documents.
It is intelligent file search solution for home and business.
Related searches
- economic growth and development pdf
- define economic growth pdf
- theories of economic growth pdf
- education and economic growth pdf
- economic growth after ww2
- us economic growth since 2010
- economic growth graph
- barriers to economic growth quizlet
- modern economic growth quizlet
- economic growth quiz quizlet
- economic growth means quizlet
- economic growth and economic development