Barbados

Recent Developments and Outlook. Barbados has continued to make good progress in implementing its Economic Recovery and Transformation (BERT) plan to restore fiscal and debt sustainability, rebuild reserves, and increase growth—but now faces a major challenge owing to the global coronavirus pandemic. Since May 2018, international reserves have recovered, helping rebuild confidence in the country’s macroeconomic framework. This has helped rebuild confidence in the country’s macroeconomic framework, though reserves are expected to be negatively impacted by the crisis in the months ahead. The completion of the external debt restructuring in December 2019 has reduced economic uncertainty, and the agreed terms with creditors have put public debt on a clear downward trajectory. On December 11, 2019, Standard and Poor’s upgraded Barbados’ foreign currency sovereign credit rating from Selective Default to B-. However, prospects for 2020 have deteriorated significantly owing to the global pandemic, and risks to the outlook are now very high and tilted to the downside.