Barbados Projecting Economic Growth for 2008

Barbados Projecting Economic Growth for 2008

Barbados is projecting economic growth of between 3 and 3.5 percent in 2008.

Central Bank Governor, Dr. Marion Williams, says this estimate is based on currently available information and could be revised since the international economic environment will play a “significant part” in the island’s performance.

“These estimates are likely to be revised, depending on the magnitude
and duration of the expected recession in the United States,” Dr. Williams said.

“Currently, we are projecting for a downturn in the US economy. However, the impact on Barbados is likely to be greater if there is a recession which moves beyond the US, particularly if it involves Canada, Europe, and the UK, particularly the latter.”

Economic growth in Barbados in 2007 was 4.3 percent.

Dr. Williams said Barbados tourism should continue to improve, albeit slower, and a pickup in the manufacturing sector is expected.

However, she predicted that competition for Caribbean tourism, due to the staging of the Olympics in China and the 2008 UEFA European Cup in Austria and Switzerland, coupled with an increasing import bill, will likely cause the Barbados external current account to deteriorate.

Foreign capital inflows are expected to go primarily towards the construction of large private sector projects.

Dr. Williams expected liquidity in the banking system to remain high in 2008, as the growth rate of deposits is projected to remain strong relative to the demand for credit.

Unemployment, which in 2007 dropped to an all-time low of 7.1 percent, is expected to remain in the single digits.

February 10th, 2008

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Brett Callaghan is the founder and managing director of Totally Barbados. I specialize in writing content for the tourism industry for my island home of Barbados. I help companies build strategies to grow online businesses with SMART marketing, advertising, and social media goals.