Economic and Financial Review - June 2019

June 2019 Economic and Financial Review ANGUILLA

uncertainty surrounding the United Kingdom’s withdrawal from the European Union and broad geopolitical tensions in the Middle East. While the balance of global risks tilt towards the downside, growth projections remain broadly favourable for Anguilla in 2019. This observation is premised on growth being supported by increased public sector investment, coupled with continued strong demand for tourism services, consistent with the record-breaking numbers in the first half of the year. Accordingly, the ECCB projects that the Anguillian economy will grow by 8.8 per cent in 2019, following an expansion of 10.9 per cent one year earlier. Activity in the hotels and restaurants sector is projected to be strong for the remainder of the year, especially in the fourth quarter. This is consistent with the anticipated demand for leisure services from the key source markets of the USA, Canada, the United Kingdom and the Caribbean. Some additional support is also expected to come from improvements in airlift and room stock, as well as the continued marketing efforts of the Anguilla Tourist Board. The forecasted positive performance in the tourism industry is anticipated to have a knock-on effect on affiliated sectors such as

wholesale and retail trade, transport, storage and communications, and electricity and water. The construction sector in Anguilla is expected to decline somewhat in 2019. This outlook is based on the slow, but improving pace of public sector investments, especially to primary and secondary schools, as part of the Anguilla Programme, funded by the UK government. Most of the major hotels and restaurants have already completed refurbishment work to their respective establishments and as such, private sector construction activity is projected to be below where it was one year ago. Inflationary pressures are expected to be broadly contained as oil prices are not projected to increase appreciably for the remainder of 2019. Despite the recent attacks on Saudi Arabian oil infrastructure, global markets continue to be adequately supplied, amidst a deceleration in demand growth, attributable to slowing world economic output growth. The fiscal operations of the Central Government are expected to generate an overall surplus in 2019. This projection is based on the continued strong growth in economic activity, powered by the tourism industry, which is having its strongest year on record. As a result, revenue collections

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Eastern Caribbean Central Bank