Economic and Financial Review June 2021 - SAINT CHRISTOPHER AND NEVIS

OUTLOOK F ollowing an unparalleled contraction in 2020, economic activity in St Kitts and Nevis is projected to remain subdued in 2021 as the country continues to grapple with the COVID-19 pandemic. ƒ While activity in the tourism industry was muted in the first half of the year, tourist arrivals are expected to increase in the latter half, particularly in the last quarter, as vaccination rates rise and stringent entry protocols ease. Agricultural output and production in the manufacturing sector are expected to continue to expand. Ongoing public and private sector projects will contribute to construction activity in the last half of the year. ƒ Risks to this outlook are, however, skewed to the downside. Slower than expected vaccination rates and the emergence of new variants could delay containment of the virus globally, which could decelerate the Federation’s rebound. St Kitts and Nevis also remain vulnerable to natural disasters, particularly in the second half of the year. ƒ On the upside, pent up travel demand and the economic recovery in advanced economies could accelerate demand for tourism services in St Kitts and Nevis and boost economic activity in the latter part of the year. Moreover, the continued fiscal support by the Federal Government could continue to bolster economic activity.

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