SVG tops IMF economic growth projections for 2023

The International Monetary Fund (IMF) has released the Regional Economic Outlook report for the Caribbean which shows positive economic growth projections for the region with St Vincent and the Grenadines (SVG) forecast to see the highest growth increase.

The Western Hemisphere Regional Economic Outlook report, dated October 13, 2023 stated that, “After a strong rebound from the pandemic and continued resilience in early 2023, growth in Latin America and the Caribbean is projected to moderate from 4.1 per cent in 2022 to 2.3 per cent this year and remain around this rate in 2024.”

Of the Caribbean countries which are classified as ‘Tourism Dependent’ which include Antigua and Barbuda, Aruba, The Bahamas, Barbados, Belize, Dominica, Grenada, Jamaica, St Kitts and Nevis and St Lucia, SVG is projected to lead growth with 6.2 per cent for 2023 and in 2024, five per cent.

For the Eastern Cariibbean Currency Union (ECCU), economic growth is forecast to be 4.7 per cent this year and four per cent in 2023.

“Following a strong rebound from the pandemic and continued resilience in early 2023, economic growth in Latin America and the Caribbean is projected to moderate from 4.1 percent in 2022 to 2.3 percent in 2023.”

The report also said that inflation will decline by more than half compared to last year.

“After reaching 7.8 per cent in 2022, headline inflation in the region is expected to decline to 5 per cent in 2023 and to 3.6 per cent next year driven by weakening external and domestic demand, easing global supply constraints, and the lagged effects of currency appreciation in some countries.”

The IMF report said that as inflation levels decrease and economic growth slows, policy makers will need to “calibrate policies carefully” with central banks expected to play a key role in controlling inflation, adding that they should remain “attentive to risks”.