[{"data":1,"prerenderedAt":-1},["ShallowReactive",2],{"doc-detail-110141-en":3,"doc-seo-110141-105":31,"detail-sidebar-cat-0-en-105":92},{"code":4,"msg":5,"data":6},0,"success",{"doc_id":7,"user_id":8,"nickname":9,"user_avatar":10,"doc_module":4,"category_id":11,"category_name":12,"doc_title":13,"doc_description":14,"doc_content":15,"file_id":16,"file_url":17,"file_type":18,"file_size":19,"view_count":20,"is_deleted":4,"is_public":21,"is_downloadable":21,"audit_status":21,"page_count":22,"language":23,"language_code":24,"site_id":25,"html_lang":24,"table_of_contents":26,"faqs":27,"seo_title":28,"seo_description":14,"update_tm":29,"read_time":30},110141,549758146520,"Patrick","https://ap-avatar.wpscdn.com/avatar/80002397d8c0411e94?_k=1775819394049821470",8,"Research & Report","Grenada - Joint World Bank-IMF Debt Sustainability Analysis","Joint World Bank and IMF Debt Sustainability Analysis for Grenada assesses the risk of external and overall debt distress and evaluates how contingent liabilities affect sustainability. External debt remains in debt distress due to unresolved arrears to official bilateral creditors as of end-2021, while projected debt dynamics are favorable under the Fiscal Responsibility Law framework renewed in 2023. The analysis quantifies the role of non-guaranteed SOE debt, PPPs, and financial market stress assumptions, and highlights the need to maintain fiscal discipline and regularize arrears to sustain the debt trajectory.","Public Disclosure  \nPub lic Disc losure Authorized  \nApproved by:  \nRobert R. Taliercio and Marcello Estevão (IDA) , Nigel Chalk and Natalia Tamirisa (IMF)  \nPrepared by the staff of the International Development Association (IDA) and the International Monetary Fund (IMF) .  \n\n| GRENADA: JOINT-BANK-FUND DEBT SUSTAINABILITY ANALYSIS1 |  |\n| --- | --- |\n| Risk of external debt distress | In debt distress |\n| Overall risk of debt distress | In debt distress |\n| Granularity in the risk rating | Sustainable |\n| Application of judgment | No |\n\nGrenada remains in external public debt distress solely due to longstanding unresolved arrears to official bilateral creditors of about US$24 .5 million (2 .2 percent of GDP) as of end-2021. However, debt is assessed as sustainable reflecting favorable projected debt dynamics from substantial fiscal surpluses that are supported by the return to the Fiscal Responsibility Law (FRL) in 2023. Public debt rose to 71.4 percent of GDP in 2020 from 58.5 percent in 2019, due chiefly to the pandemic-induced collapse in GDP. Supported by the economic recovery driven by a normalization of the tourism and offshore education sectors, it resumed its pre-pandemic downward trend in 2021 to reach an estimated 70.3 percent of GDP, with a further marginal decline expected in 2022. Going forward, continued adherence to the FRL and regularization of arrears will be needed to maintain a sustainable debt trajectory and upgrade the risk rating. Debt-to-GDP should be further reduced and kept at levels needed to withstand the existing vulnerabilities to external shocks and natural disasters.  \n1. Public debt in this DSA is defined as the sum of central government debt (including arrears on principal and interest and overdue membership fees to international organizations) and governmentguaranteed debt. It does not include non-guaranteed debt of state-owned enterprises (SOEs) and limited liability companies, notably PDV Grenada’s debt on account of the Petrocaribe arrangement. Based on the determination that the Government of Grenada is not responsible for the debt but only for its shares in the company, the Petrocaribe debt has not been included in the stock of central government debt.2 Until recently, gaps and time lags in the public enterprises’ reporting hampered complete coverage of public sector debt. Substantial improvement in the comprehensiveness and timeliness of SOE debt data has been made more recently, but an expansion of the perimeter to the public sector is still unfeasible because of less clarity on SOE above-the-line operations. Non-guaranteed debt is estimated at around 16 percent of GDP in end-2021, including 12.4 percent of GDP for the Petrocaribe arrangement. Grenada does not have subnational government debt.  \n\n|  |\n| --- |\n| 1\u003Cbr>2\u003Cbr>3\u003Cbr>4\u003Cbr>5\u003Cbr>6\u003Cbr>7\u003Cbr>8 Subsectors of the public sector Sub-sectors covered Central government\u003Cbr>State and local government\u003Cbr>Other elements in the general government\u003Cbr>o/w: Social security fund\u003Cbr>o/w: Extra budgetary funds (EBFs)\u003Cbr>Guarantees (to other entities in the public and private sector, including to SOEs)\u003Cbr>Central bank (borrowed on behalf of the government)\u003Cbr>Non-guaranteed SOE debt X\u003Cbr>X |\n|  |\n\n2. The contingent liability stress test accounts for the risks from the estimated stock of nonguaranteed SOE debt as well as ongoing PPPs and financial markets. The stock of non-guaranteed SOE debt is substantial, estimated at around 16 percent of GDP at end-2021, and is reflected in the contingent liability stress test. The bulk of this shock (12 .4 out of 16 percent of GDP) is accounted for by PDV Grenada’s total debt.3 The current stock of PPP capital remains at zero, and thus the related contingent liability shock is also set to zero. Grenada’s FRL puts a cap on PPP-related government liabilities at 5 percent of GDP. Contingent liabilities from financial markets are set at the minimum value of 5 percent of GDP, which represents the average cost to the ","cbCaidon6TmlHX2P","https://ap.wps.com/l/cbCaidon6TmlHX2P","pdf",746147,2,1,18,"English","en",105,"# Debt distress risk assessment\n## External debt arrears and overall risk rating\n## Fiscal Responsibility Law and debt trajectory\n# Debt definitions and coverage\n## Central government and guarantees\n## Non-guaranteed SOE debt and exclusions\n# Contingent liabilities stress test\n## Non-guaranteed SOE debt shock\n## PPP and financial market assumptions\n# Public debt evolution and drivers\n## Pre-pandemic declines and pandemic rise","[{\"question\":\"Why does Grenada remain in external public debt distress?\",\"answer\":\"Grenada remains in external public debt distress due to longstanding unresolved arrears to official bilateral creditors, about US$24.5 million (2.2 percent of GDP) as of end-2021.\"},{\"question\":\"What supports the assessment that Grenada’s debt is sustainable despite distress?\",\"answer\":\"Favorable projected debt dynamics are supported by substantial fiscal surpluses backed by the return to the Fiscal Responsibility Law (FRL) in 2023.\"},{\"question\":\"How does the analysis treat contingent liabilities from SOE debt, PPPs, and financial markets?\",\"answer\":\"The contingent liability stress test includes risks from non-guaranteed SOE debt (about 16 percent of GDP at end-2021), sets the PPP-related shock to zero since PPP capital stock is zero, and assigns a financial market stress at a minimum value of 5 percent of GDP.\"}]","Grenada - 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