The IMF says the Eastern Caribbean Currency Union's role as pillar of regional stability is being tested because of the high levels of public debt.
The fund noted that uneven fiscal discipline across member countries is having a negative impact on its ability to respond to shocks such as Hurricane Melissa.
The IMF also says this test is not due to a new crisis but a familiar problem - the return to growth since the COVID-19 pandemic - but limited improvements in government finances and the heavy debt burdens as a result.
The international lending agency says the tourism and construction sectors have been driving growth in these countries and inflation is easing
But the debt to GDP ratios have stopped declining at a time when growth is slowing and global risks are intensifying.
It is against this background that it concluded that the union's long standing target to reduce the debt to GDP ratio to 60% by the year 2035 is at risk.
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