Barbados, Tax Or The Axe

You can’t have it both ways. That’s the message from the Minister of Finance to the leadership of two unions who are threatening to shut down the country over the Government’s planned increase to the National Social Responsibility Levy (NSRL) from 2 to 10%, and a 2% tax on forex transactions. The Minister said either $240m needs to be raised by taxes, or a reduction in government expenditure by the same amount. Read more on nationnews.com

Past Governor Of Central Bank: Productivity Lessons From Singapore

BRIDGETOWN, Barbados – In his most recent economic letter – Dr. DeLisle Worrell, immediate past Governor of the Central Bank of Barbados – looks at productivity lessons from Singapore, a country which has been compared and contrasted to Barbados from a development standpoint.

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IMF Outlook: Some Growth For The Caribbean 2017 2018, But Risks Remain

The International Monetary Fund (IMF) released their April 2017 regional economic outlook for the western hemisphere a few hours ago.

Highlights:

Caribbean economies dependent on tourism and commodity exports are projected to grow between 1.5 and 3% between 2017 and 2018.

Several islands (Grenada, Jamaica and St. Vincent and the Grenadines) enjoyed strong growth in tourism in 2016 due to increased arrivals in stopover and cruise segments. Trend expected to continue in 2017 driven by economic growth in the U.S. (the primary market for most destinations in the region, with the exception of Barbados which relies on the U.K.).

Commodity exporters, including Trinidad and Suriname, were hit by lower commodity prices in 2015 and 2016, and are projected to return to positive growth in 2017 and 2018, benefiting from higher (though still low) commodity prices.

Public sector debt remains a major vulnerability. Several tourism dependent economies have seen their public-debt-to-GDP ratio decline from very high levels, with several countries (Grenada, Jamaica, St. Kitts and Nevis), engaged in fiscal consolidation programmes. In Barbados and Belize, public debt has increased in recent years and fiscal consolidation and structural reform is needed.

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Source: International Monetary Fund

IMF Completes Final Review Of Grenada Extended Credit Facility

ST. GEORGE’S, Grenada – The International Monetary Fund (IMF) has completed their final review of the island’s performance under a programme supported by a three year arrangement under the Extended Credit Facility (ECF)

According to The Fund:

The Extended Credit Facility (ECF) provides financial assistance to countries with protracted balance of payments problems. The ECF was created under the Poverty Reduction and Growth Trust (PRGT) as part of a broader reform to make the Fund’s financial support more flexible and better tailored to the diverse needs of low-income countries (LICs), including in times of crisis. The ECF is the Fund’s main tool for providing medium-term support to LICs.

The completion of the review allows for final disbursement of US$2.8m, for a total of US$19.4m, since the arrangement was approved in June 2014.

The island has successfully met targets, including fiscal adjustment and debt reduction. The economy also grew by around 3.9% in 2016 thanks to construction activities and tourism services.

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Source: International Monetary Fund

IMF: Fifth Year Of Growth Expected For St. Kitts and Nevis In 2017

BASSETERRE, St. Kitts and Nevis – Driven by the country’s Citizen-by-Investment (CBI) programme, and prudent macroeconomic policies, the IMF in their concluding statement of their 2017 Article IV Mission,  said that the island is expected to enjoy its fifth consecutive year of growth.

“Notwithstanding a difficult international environment, St. Kitts and Nevis’ economy is expected to grow again in 2017 for the 5th consecutive year. St. Kitts and Nevis’ strong macroeconomic performance owes much to the robust Citizenship-by-Investment (CBI) inflows and their spillovers to the economy, as well as overall prudent macroeconomic policies. Against the background of elevated risks to CBI inflows and risks associated with completion of the debt-land swap, the mission focused on measures to safeguard macroeconomic and financial stability, including by strengthening the fiscal policy framework and reducing reliance on CBI inflows, and necessary reforms to attain sustainable, inclusive growth.”

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Source: IMF