Barbados Economic Performance Review of 2012
Barbados is banking on its all important tourism industry to register a slight increase in economic growth by yearend, despite the depressed global economy. Totally Barbados has concluded that this was the main message from the Central Bank of Barbados in its review of the country’s performance for the first nine months of 2012.
Central Bank of Barbados’ Governor Dr. Delisle Worrell said: “Real economic output is forecast to rise marginally for the remainder of 2012, provided the winter tourist season does not disappoint”.
The comment was made against the background of his acknowledgment that the Barbados economy continues to deal with the persistent weakness of the global recovery.
That challenge is evident in the sluggish or non-existent economic growth in many of the major economies of the world, some of which, like the U.S and UK, are major source markets for Barbados’ tourism industry.
The effect, according to the Central Bank’s figures, has been a fall-off in tourism value added between January and September.
“Long-stay arrivals have declined by five percent (5%) for the period January to August, a reflection generally of weak consumer demand across source markets,” Dr. Worrell said.
He added: “The number of tourists travelling from the UK declined by ten percent (10%), mainly as a result of the loss of the additional British Airways flight from Gatwick.
The US market has also been affected by a reduction in airlift. The discontinuation of the Delta flight from Atlanta and the American Airlines flight from Dallas has contributed in large measure to the six point eight (6.8%) percent fall in arrivals.”
There were however some positives from the Barbados tourism industry.
In contrast to the US and UK, the Canadian market registered improvements, as it benefitted from an additional weekly charter service from Air Transat.
Continental Europe was also a bright spot, mainly due to a fortnightly charter service out of Sweden by Tui Nordic, which boosted arrivals.
Close to home in the Caribbean, visitor arrivals from Trinidad and Tobago were up 15 percent.
On the cruise tourism side the picture was somewhat mixed. During the first half of the year, arrivals actually increased by 0.3 percent. That marginal growth was however eroded by the loss of some cruise ships during the summer months.
One of the ways in which this particular issue is being addressed by Barbados, is through its recently announced plans to develop a new ultra-modern cruise facility called Sugar Point.
That development along with recent amendments to the legislation pertaining to the cruise industry, are intended to make the sector more attractive and competitive.
In the Central Bank’s review Dr. Worrell said Barbados’ continued pursuit of economic growth should focus on investment in areas that earn or save foreign exchange. Leading these sectors is tourism, which is the island’s biggest generator of foreign exchange, followed by international business.
Dr Worrell offered one specific suggestion on how Barbados could seek to boost its numbers for the winter season.
He said the island should be strategic in its marketing, by targeting specific areas in source markets that have shown an above average resistance to the global economic downturn.
The Central Bank of Barbados governor said this would allow Barbados to maximise the return on its investment.
November 6th, 2012