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2018 Annual Economic and Financial Review ST KITTS AND NEVIS
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Eastern Caribbean Central Bank
and capital spending plans of the government
with knock-on effects on growth. Financial
risks reflect increased credit costs for the
Federation’s major trading partners, the USA,
the UK and the European Union as the Federal
Reserve and other central banks become less
accommodative. Structural damage and
impairment of the major productive sectors
posed by weather related threats from
hurricanes and flooding represent additional
risks to the downside.
On the upside, the economy of St Kitts and
Nevis could benefit from generally positive
global economic growth, specifically in its
major trading partners.
Continued buoyancy
in the economy of the USA and a diminution
of global financial risks could help the country
to retain its current economic trajectory.
Real Sector Developments
Value added in the hotels and restaurants
sector, a proxy measure of activity in the
tourism industry, is estimated to have risen
by 9.9 per cent in 2018, which compares
favourably with the 0.7 per cent expansion
in the previous year.
Developments in the
sector were driven by a 7.0 per cent increase
to 1,276,855 in total visitors, compared with
a 13.1 per cent improvement in 2017. Total
visitor arrivals strengthened, attributable to
the improved performance in the number of
cruise ship passengers and stay-over arrivals.
The number of stay-over visitors, whose
contribution to value added is relatively more
important, increased by 1.5 per cent to
116,607 in 2018, in contrast to a 0.8 per cent
decrease observed in 2017. The boost in stay-
over arrivals was largely attributed to a
recovery in visitors from the United States of
America the largest source market, by
3.2 per cent to 69,283 in contrast to a decline
of 1.0 per cent in 2017.
The major contributing factor to the
performance of the USA market was increased
direct marketing and airlift in the major
gateways to the destination, while the hosting
of regional events; the St Kitts Music Festival
and the Caribbean Premier League boosted