BASSETERRE, St. Kitts -- The Caribbean Development Bank (CDB) has revised its growth projection for 2024, anticipating a slower pace compared to 2023. The region is expected to experience a growth rate of 2.3 percent this year, down from the previously forecasted 2.5 percent.
However, when factoring in Guyana's economic boom driven by its oil discovery, the region is forecasted to achieve a growth rate of 8.6 percent - across the 19 borrowing memberstates. Ian Durant, Director of Economics at the Caribbean Development Bank, shared these insights during the Bank’s Annual News Conference on February 20, 2024.
Durant highlighted the significant role of increased oil production in Guyana and the ongoing expansion of the tourism industry in driving growth across the Caribbean region. Excluding Guyana, the growth projection for the region falls to 2.3 percent, indicating a moderation from the estimated growth of 2.5 percent in 2023. This trend aligns with the broader global pattern of slowing economic growth and the normalization of economic conditions in the Caribbean.
During his presentation titled “Current and Future Requisites For Prosperity,” Durant emphasized the generally favorable performance of the Bank’s 19 Borrowing Members in 2023. However, he noted that Haiti remained an exception due to continued instability and high inflation.
Looking ahead to 2024, Durant projected a positive trajectory for 18 of the Bank’s 19 clients, anticipating continued economic rebound from the COVID-19 shock. He highlighted tourism as a key driver of regional economic performance, with service-exporting economies experiencing growth at an average rate of 2.4 percent. By the end of 2023, 11 countries had surpassed pre-pandemic output levels.
Despite the optimistic outlook, Durant acknowledged various risks, including sluggish global growth, persistent high inflation, climate change challenges, and natural disasters, which could undermine economic performance. He underscored the importance of resilience-building measures, including climate-resilient infrastructure, institutional framework improvements, digitalization, and the adoption of artificial intelligence.
Durant also emphasized the need to expand the human resource base, reduce skills gaps, enhance sustainable energy, improve logistics quality, and facilitate intra-regional trade to develop regional value chains and enhance food security.
In terms of fiscal policy, Durant advised governments to strike a balance between securing fiscal sustainability and facilitating growth and development. He emphasized the importance of access to adequate and affordable financing to support investments aimed at resilient prosperity without compromising debt sustainability efforts.
Durant concluded by stressing the importance of raising competitiveness through increased productivity and lower production costs to reduce high export concentration and build economic resilience over the medium to long term.
