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2018 Annual Economic and Financial Review ST VINCENT AND THE GRENADINES
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Eastern Caribbean Central Bank
improved. Meanwhile, the external account
was characterised by a wider trade deficit
reflecting an expansion in import payments.
The growth momentum of the economy of
St Vincent and the Grenadines is expected
to moderate in 2019, reflecting both
domestic and international developments.
Activity is projected to be supported by the
continued developments from the Argyle
International Airport and the impact of
initiatives announced in the 2019 budget.
Specifically, the country is expected to benefit
from another full year of operations of the
Argyle International Airport, with the
introduction of year-round flights from major
cities in the United States of America and
Canada. These developments are likely to
sustain growth in key services sectors
including hotels and restaurants. However,
government balances are expected to
deteriorate in light of increased expenditure
from initiatives announced in the 2019 budget
as well as the full impact of fiscal incentives
announced in 2018.
The outlook for 2019 is
subject to downside risks, particularly as it
relates to the evolution of global
developments.
The International Monetary
Fund (IMF) has projected that the global
economy would slow to 3.3 per cent in 2019,
amidst rising trade tensions and challenges
with achieving an orderly Brexit agreement.
These potential risks to the global economy,
as well as continuing risks of natural disasters,
may cloud the 2019 economic outlook for St
Vincent and the Grenadines.
Real Sector Developments
Real GDP in St Vincent and the Grenadines
recorded growth of 3.2 per cent in 2018,
following a marginal expansion of
0.7 per cent in the prior year, reflecting
positive trends across most of the main
sectors
.
Buoyed by the first full year of operations of
the Argyle International Airport, value added
in the hotels and restaurants sector, a proxy
for tourism activity, is estimated to have
expanded by 3.8 per cent in 2018, following a
marked contraction of 18.2 per cent in 2017.
This outturn largely reflected a 5.4 per cent