The New York Times published an article detailing the struggle of Barbados as it faces the challenges of paying its debt to the financial institutions and being further hampered by climate change disasters, with significance to Prime Minister Mia Mottley's work on the matter. Read an excerpt below, and click here for the full story.
The Barbados Rebellion
By Abrahm Lustgarten
With Lagarde on the phone, Mottley made her pitch. Barbados, she said, was going to default on the debt it owed to private banks and investors. She wanted Lagarde’s support in persuading them to renegotiate its terms. The I.M.F. is both the assessor and the enforcer of global economic policy, the de facto gatekeeper to the world’s capital markets. Mottley knew that banks and investors would work with her only if Barbados were participating in a formal I.M.F. program for economic reform — and it had to start immediately.
Mottley told Lagarde that Barbados was prepared to do voluntarily what most countries have to be coerced to do: cut its budget and raise taxes. But she needed something in return. With the effects of climate change bearing down on the region, the kind of austerity the I.M.F. demanded from developing nations — slashing the size of government agencies and firing thousands of public employees while auctioning off real estate and other national assets — would no longer work. Mottley wanted Lagarde to endorse an economic program that would still allow her to raise salaries of civil servants, build schools and improve piping and wiring for water and power. “Before you carry people on a long journey,” she told Lagarde, “you have to give them a little breakfast.”
Read here for more.