The International Monetary Fund Executive Board concluded the 2025 Article IV consultation with Grenada and endorsed the staff appraisal under the lapse-of-time procedure. The review finds activity robust after Hurricane Beryl, with 2025 growth estimated at 4.4 percent on investment and construction, inflation moderating, and the financial sector broadly stable despite a modest post-hurricane impact. Fiscal rules were temporarily suspended to fund reconstruction, and the IMF projects a 2025 primary deficit of 3.2 percent of GDP, while judging the underlying fiscal position sound. A return in 2027 to the 1.5 percent of GDP central government primary balance floor is seen as important to safeguard discipline and keep debt sustainable, with the 60 percent of GDP target projected for 2033; the external position in 2024 is assessed as weaker than implied by medium-term fundamentals and desirable policies, with the current account deficit expected to remain elevated until construction-related import pressures subside. To reduce fiscal and financial-sector risks, the appraisal called for stronger management of large public investment projects, including tighter project execution, assessment of future operating and maintenance costs, operationalising the public-private partnership framework, and strengthened management of citizenship-by-investment resources, alongside improved Medium-Term Fiscal Framework projections and clearing the backlog of audited government statements. It also urged better alignment of the primary balance rule with the general government debt anchor by capturing off-budget and public on-lending-financed investments and applying equivalent reporting and auditing standards, while stepping up monitoring of accelerating credit growth and non-bank vulnerabilities, reinsurance conditions and pricing in general insurance, and maintaining momentum on anti-money laundering and combating the financing of terrorism reforms; persistent data gaps and capacity constraints were flagged as a constraint on policymaking.
International Monetary Fund 2026-01-21
International Monetary Fund concludes 2025 Grenada Article IV and endorses return to fiscal rules in 2027
The IMF Executive Board concluded the 2025 Article IV consultation with Grenada, noting robust activity post-Hurricane Beryl with 4.4% growth, moderated inflation, and a stable financial sector. The IMF emphasized returning to a 1.5% of GDP primary balance by 2027 to maintain fiscal discipline, recommending stronger management of public investment projects, improved fiscal frameworks, and enhanced monitoring of financial sector risks.