SVG’s economic outlook for 2015, 2016 among best in sub-region

According to the International Monetary Fund (IMF), St Vincent and the Grenadines (SVG) has among the best economic outlooks for 2015 and 2016 within the Organization of Eastern Caribbean States (OECS).{{more}}

The IMF’s ‘Regional Economic Outlook for the Western Hemisphere’ report — which was released on April 29 — indicates that while only St Lucia (-1.1 per cent) recorded economic growth less than SVG (1.1 per cent) for 2014, there will be improvements this year and in 2016.

In terms of output growth, SVG’s 2015 figures have been projected at 2.1 per cent, which is the third highest in the sub-region. St Kitts and Nevis is predicted to have growth of 3.5 per cent and Dominica, 2.4 per cent.

For 2016, SVG’s output growth has been projected at 3.1 per cent — the highest within the OECS, and the third highest within the wider Caribbean region. Only the Dominican Republic and Haiti have been allocated higher projections at 4.5 and 3.8 per cent, respectively.

In terms of inflation, SVG recorded 0.6 per cent in 2014, and is projected to achieve 0.1 per cent for 2015. This is the second lowest both in the OECS (Grenada is projected the lowest with – 1.0 per cent) and the wider Caribbean region.

Although the 2016 projections show inflation in SVG will rise to 1.6 per cent, this ties us with Antigua and Barbuda for second lowest rate within the OECS, and second lowest within the wider Caribbean region. Dominica is projected the lowest, both in the sub-region and the wider Caribbean, with 0.6 per cent.

In comparison to South America’s growth, a better outlook is expected for the Caribbean in the 2015 – 2016 timeframe on a whole — along with Central America and Mexico.

The IMF report also stated: “Economic recovery is also expected to continue in the Caribbean, although external, fiscal and financial vulnerabilities remain high in several economies. In the tourism-dependent Caribbean, growth is projected to improve to two per cent, in 2015.”

Additionally, the report recommended that a key priority for governments should be tackling long-standing structural problems to raise investment, productivity and potential growth.

“Improvements in business environments, infrastructure, and education will help to foster more diversified, resilient and prosperous economies.”

Leader of the Opposition Arnhim Eustace declared two weeks ago that SVG had recorded negative growth in 2015, and challenged the Government to deny his claim.

The IMF’s report put SVG’s economic growth in 2014 at 1.1 per cent.