Economic and Financial Review - June 2019

June 2019 Economic and Financial Review SAINT VINCENT AND THE GRENADINES

recorded in the corresponding period in the previous year. External loan disbursements to the central government fell by 28.4 per cent to $28.4m during the period, while external principal payments rose by 4.9 per cent to $27.9m. Disbursements during the period came from creditors such as; the Caribbean Development Bank, the Kuwait Fund for Arab Economic Development and the Organization for Petroleum Exporting Countries. Consequently, net disbursements fell by $16.6m to $0.5m relative to $17.1m in the comparable period of 2018. for Saint Vincent and the Grenadines remains positive for the second half of 2019, driven by a favourable external environment and encouraging economic prospects on the domestic front. In the context of external developments, the International Monetary Fund (IMF) has projected a global expansion of 3.2 per cent in its July 2019 update of the World Economic Outlook. Meanwhile, growth in the major trading partners; the United States of America and the UK is forecasted to improve at a rate of 2.6 per cent and 1.3 per cent respectively, moderated by the dimmed outlook of a Outlook The economic outlook

slower expansion of 1.3 per cent for the Euro Area.

Given the positive global prospect, the ECCB estimates that the economy of Saint Vincent and the Grenadines should expand by 2.5 per cent in 2019. This assessment is buttressed by positive developments in the hotels and restaurants sector associated with increased airlift into the recently commissioned Argyle International Airport, stepped up marketing and brand awareness building coupled with initiatives to increase the room stock. The weekly year-round American Airlines flight from Miami to Saint Vincent and the Grenadines which commenced in December 2018 will be increased to two flights per week beginning in December 2019. This would supplement the current weekly service by Caribbean Airlines (CAL) between New York and Saint Vincent and the Grenadines and the weekly high-season service from Toronto Canada by Air Canada Rouge. The planned increase in airlift is expected to further boost the hotels and restaurants sector, which is estimated to register positive value added in 2019. Likewise, greater promotion of the destination will target the Caribbean market (Trinidad and Tobago and Barbados), while

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Eastern Caribbean Central Bank