Barbados, the Caribbean nation whose prime minister, Mia Mottley, has championed the argument that small and developing countries desperately need debt relief and funding if they are to survive climate change, has reached an agreement with the International Monetary Fund that will make it among the first recipients of money from a new $45 billion resilience trust.
Under the program, Barbados is set to receive $183 million for climate-focused spending. It’s money that Avinash Persaud, Mottley’s top economic adviser, tells ProPublica will be used to replace segments of the island’s drinking water system and to shore up its supply of fresh water in the face of climate-driven drought. Barbados’ current water infrastructure was built by the British more than a century ago and loses about half of the water it carries.
“This will go a significant way towards helping us start that project,” Persaud said. “These are not sexy things, but they are very important things in a world of climate change.”
The IMF has announced a similar agreement with Costa Rica for $710 million and has told ProPublica that another agreement with Bangladesh may soon be announced.
The trust funds are technically a loan, offered at low or “concessional” interest rates, to be paid back over 20 years after a grace period of a decade. The agreement is pending approval by the IMF’s board in the coming weeks. The money for Barbados is being paired with a $110 million IMF loan to support Barbados in continuing to reduce its debt and restructure its economy.
