The Barbados-based Caribbean Development Bank (CDB) will provide funding for in excess of five projects in Grenada as part of their contribution to the island’s homegrown Structural Adjustment Programme (SAP).
According to Minister for Economic Development, Trade, Planning and Cooperatives, Oliver Joseph, the island expects to receive US$30 million through a policy-based loan from the CDB to support the country’s fiscal stability objectives.
He told reporters that the regional bank sent a mission to Grenada in March to look at areas where assistance can be given to the island.
He spoke of $10 million being earmarked to help improve quality access to education and training, student loan scheme, through the Grenada Development Bank ($5 million), and Housing ($2.5 million), $7.5 million to promote environmental sustainability, and $4 million to modernise social and economic infrastructure.
“…We are looking for resources to put into GDB to help the private sector especially small and medium enterprises”, he said.
Minister Joseph disclosed that the Board of Directors of CDB is due to meet this month and the financial package for Grenada is then expected to be discussed.
He said that government officials “are working very hard to ensure that they have the total proposal package ready for their board meeting on the 27th of May…”.
“…We are confident that the information that they asked from Grenada will be sent on time and they are eager to take it to their board to support our Structural Adjustment Programme,” he added.
The senior government minister appears to be optimistic of CDB support for the Grenada programme.
He spoke of the bank already giving a “high level of commendation” to the Structural Adjustment Programme.
“The CDB commended the Grenada government for taking these bold measures of introducing measures that would correct the fiscal situation and bring stability at bay,” he remarked.
Minister Joseph believes that the Keith Mitchell-led government is on the right track with its policies given the level of support for the current programme by world bodies such as the World Bank, IMF, and the European Union.
“…We as a government think that the policies and the decisions we are taking now would bring economic growth to the country and that is the area that we are focusing heavily on, getting economic growth,” he said.
“You can see from the resources that (have) been pledged, the IMF Board will be meeting in May, the CDB will be meeting in May, so resources should start coming by June to help the government carry out the programmes that (have) been listed in the budget,’ he added.
According to Minister Joseph, once the funds have arrived on the island, government intends to start spreading it out immediately.
“You would see an increase in the allocation for houses, that is both house repair and new houses, there will be increased opportunities for students to get student loan during that same period, there will be increased infrastructure development, roads will be constructed, bridges will be constructed and so jobs will be created within that period as the funds become available,” he said.
The minister dropped hints that Grenada stands to benefit from an additional $60 and $65 million from CDB under a special envelope facility.
He said the $30 million can be categorised as “immediate assistance” to get the structural adjustment programme going and then “we would examine the possibility of applying for the loan (about $65 million) that is available under this special envelope so I think it is important that people know that.”
The Mitchell government is currently facing a severe fiscal problem in which the island has been forced to default on its massive national debt of EC$2.4 billion.
Most of the debts were racked up under a former Mitchell regime that ran the island from 1995 to 2008 when it borrowed heavily and at high interest rates on the commercial market for a host of non-productive projects.