Grenada: IMF admits failures

27 February 2014

In December 2013, the IMF released an ex post assessment (EPA) of its 2006-2011 lending programme to Grenada. The IMF examined its $28 million loan (see Observer Winter 2014) and concluded that Grenada failed to meet key structural reform measures. The report, compiled by the Fund staff, admits that the “too optimistic” programme failed to take into account Grenada’s political and institutional constraints, and  that “programme ownership was also in question”. The EPA identified lessons that should inform the designs of future programmes, as the IMF projections repeatedly missed Grenadian reality by assuming positive outcomes in a country in crisis. In early February, the government proposal of a three-year wage freeze, seen as a precondition for a new IMF loan, was rejected by Madonna Harford, head of Grenada’s Trade Union Congress, as it “would leave public sector workers at a disadvantage in the long run”.