Grenada will wrap up debt deal soon: IMF
By Paul Kilby
NEW YORK, Aug 27 (IFR) - Grenada is expected to conclude its debt restructuring in a matter of weeks, the International Monetary Fund said on Thursday following a recent visit to the country.
Under the April deal, bond creditors agreed to a 50% haircut and special warrants on some US$262m of international and local bonds related to the island's citizenship-by-investment program.
Bondholders exchange their current holdings - securities on which the country defaulted in 2013 - for new 15-year amortising bonds with a 7% coupon.
"It will be important to finalize this agreement promptly so as to clear uncertainty regarding financing and unleash confidence and investment," the IMF said.
It said the restructuring - which gives Grenada debt relief worth 19% of its GDP - would be completed in the coming weeks.
The deal is a much-needed reprieve for a country burdened with total public sector debt that reached 111% of GDP in 2014, according to IMF estimates.
"Grenada is making solid progress implementing its homegrown economic program, restoring fiscal sustainability and laying the groundwork for stronger growth," the IMF said.
The Fund is now forecasting 3.1% growth this year, compared to the 1.7% it had calculated earlier this year.
The island nation defaulted on a US$193m 2025 international bond issue - and on local bonds with the same maturity - in 2013 in the wake of a series of hurricanes and the financial crisis. (Reporting By Paul Kilby and Krista Hughes; Editing by Marc Carnegie)
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