IMF Staff Mission Visits Dominica

An International Monetary Fund (IMF) mission led by Aliona Cebotari visited with Government and private sector representatives in Dominica from the 13- 23rd August 2012.

A statement issued by Cebotari on Friday September 7th, said that, the authorities’ decisive actions to support the recovery through public investment have helped Dominica withstand a challenging economic environment.

However, weak demand and an outbreak of banana leaf disease will continue to hold back the recovery. Growth is expected to remain subdued this year, accelerating gradually to around 2 percent over the medium term. Rising global food prices may contribute to a modest rise in inflation and weigh on the balance of payments in 2012, but pressures are expected to subside later next year.

Talks between the authorities and the IMF staff focused on policies needed to maintain fiscal sustainability without derailing the economic recovery and on ways to safeguard the stability of the financial system.

Discussions were also help on policy actions and reforms to assure continued financial sector stability.

These include active monitoring and vigorous action to address risks in the financial system, which may arise from exposure to the failed regional insurance companies, a weakening credit portfolio, and potential spillovers from regional financial markets.

Additionally, efforts should be directed at strengthening the supervision and regulation of the financial system, including through a prompt corrective action framework and aligning the provisioning requirements with best international practice.”

The mission will prepare a report to the IMF’s Executive Board that will consider staff findings at end-October.

The mission would like to express its gratitude to the authorities for their candid discussions, timely provision of information, and gracious hospitality.

© 2012 SAT Telecommunications Ltd.

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