Grenada wants to invoke debt suspension clause | Caribbean

ST. GEORGE’S, Grenada, CMC – Grenada has written to financial agencies and multilateral partners requesting the activation of the debt repayment suspension clause contained in several loan agreements following the devastation caused by Hurricane Beryl that devastated the country earlier this week.

In 2022, Grenada’s national debt was estimated at $0.77 billion.

“The Finance Minister has already written to some of our multilateral partners to alert them to this catastrophic event and to urge them to trigger our debt suspension clause in some of these agreements,” Prime Minister Dickon Mitchell said at a press conference.

After Hurricane Ivan hit the country in 2004, then Prime Minister Dr. Keith Mitchell successfully pushed for debt relief to be included in all new loan agreements.

The clause is triggered whenever the country is affected by natural disasters such as hurricanes, earthquakes or a health pandemic. The last time Grenada requested a trigger for this clause was in 2020, when COVID-19 was declared a pandemic.

Prime Minister Mitchell said the passage of Hurricane Beryl would have both financial and social impacts on the country’s economy and would require significant resources.

He told reporters that the cleanup alone would cost “tens of millions of dollars” and announced a nationwide cleanup operation for the weekend.

Mitchell acknowledged that “rebuilding Grenada, Carriacou and Petite Martinique will be a mammoth task.”

He said the Cabinet had agreed to set up several working groups to assess the damage and impact of the category four hurricane on the country during an emergency meeting on Tuesday evening.

“We have agreed to establish a task force to address this significant catastrophic event and examine its impact on the 2024 budget, the economy and the current fiscal position.

“We will set up a task force to coordinate relief efforts in collaboration with NaDMA (National Disaster Management Agency) with regard to our foreign partners,” said Prime Minister Mitchell, who is also responsible for the National Disaster Management Department and chairs the National Emergency Advisory Council.

“The Cabinet also approved the establishment of a working group to conduct a detailed assessment of losses and damages to determine the extent to which the island has suffered from Hurricane Beryl in the areas of agriculture, fisheries, housing, public buildings, private buildings, public infrastructure and the environment,” he said.

“I want to stress that the environment has been severely damaged by this hurricane, not just the built infrastructure. We need to ensure that we accurately measure and are able to quantify the loss and damage, as this has a significant impact on Grenada’s economy, on the government’s fiscal position, and on some of our contractual obligations, liabilities and services,” Mitchell added.

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