Grenada not seeking to trigger debt suspension clause

by Linda Straker

• Ahead of Hurricane Beryl, Government ensured interaction with borrowing partners and other entities
• Process for payment deferrals began immediately after Met Office announced Grenada was in path of Category 4 hurricane
• Grenada is yet to formally write to multilateral partners requesting triggering debt suspension clause

Finance Minister Dennis Cornwall has disclosed that Grenada has not written to multilateral partners seeking to suspend debt payment in the aftermath of Hurricane Beryl, but instead has held discussions aimed at deferring payments “if needs be” on loans that contain the debt suspension clause if the country was affected by a natural disaster such as a major hurricane.

“We have not sought a suspension of the loan agreements. What we have done is to basically rap with them and utilise measures that we are allowed under the loan agreement to defer payments if needs be,” Cornwall said in a news conference on 17 July.

He said that the process for payment deferrals began immediately after it was announced by the Meteorological Office that Grenada was in the path of the Category 4 hurricane. “We began the process even before Beryl hit us on Grenada because we were aware based on the information from the Meteorological Office that Grenada was likely to be impacted by Hurricane Beryl and therefore, days before Beryl hit us, we had already put things in motion to ensure that we can interact with our partners at the World Bank, IMF and other entities that we borrow from,” Cornwall said.

However, during a news conference on 2 July, Prime Minister Dickon Mitchell said that Grenada had written to lending agencies and multilateral partners requesting that the debt payment suspension clause in several loan agreements be triggered because of the devastation on the country following the passage of Beryl.

“The Minister for Finance has already written to some of our multilateral partners to indicate to them that this catastrophic event has happened and to trigger our debt suspension clause in some of these agreements,” Prime Minister Dickon Mitchell announced during a 10:15 pm news conference Wednesday, 2 July 2024.

On 11 July, when asked to provide an update on the status of the debt suspension request, the Prime Minister Dickon Mitchell disclosed that Grenada is yet to formally write to multilateral partners requesting that the debt suspension clause in several loan agreements that was obtained after Hurricane Ivan in 2004 be triggered.

“We have not yet made the formal request to some of our partners to trigger the debt suspension clauses we have in some of our financial instruments,” he told journalists during the questions and answer segment of press conference held by the United Nations office in Barbados to launch a regional response plan aimed at raising EC$9 million to be shared between Grenada and St Vincent and the Grenadines.