Home' Trinidad and Tobago Guardian : September 21st 2014 Contents Caribbean, Central American
and European economists
surveyed by Barcelona-
based FocusEconomics fore-
cast T&T s economy will
grow 2.1 per cent in 2014
and 2.3 per cent in 2015. In
July, annual inflation rose to 5.9 per cent from
June s 3.0 per cent. FocusEconomics Consensus
Forecast panelists expect that inflation will
end 2014 at 5.0 per cent, and 2015 at 4.7 per
cent. The T&T section of the 63-page report
released September 16 is authored by econ-
omist Angela Bouzanis. She is one of 10 econ-
omists who wrote the report.
Although at 2.1 per cent, T&T has one of
the lowest growth forecasts in Central America
and the Caribbean---above only El Salvador
(1.9 per cent), Jamaica (1.2 per cent) and Puerto
Rico (-0.9 per cent)---it has the highest pro-
jected gross domestic product (GDP) per capita
in the region at US$19,589.00. By 2015, GDP
per capita is expected to grow further by 6.6
per cent to US$20,880.0, while GDP is pro-
jected to grow by 2.3 per cent only, according
to the report.
Consumption is expected to fall in T&T in
2014. After going up seven per cent in 2012
and 3.7 per cent in 2013, economists surveyed
said consumption will fall to 2.7 per cent in
2014 but pick back up to 3.2 per cent in 2015.
Investment is forecast to continue growth
commenced in 2010. Economists said invest-
ments in the country had declined in 2009
by -12 per cent. In 2010 investments grew by
2.8 per cent; in 2011, 2.2 per cent; in 2012, 3.7
per cent; and in 2013, 4.0 per cent. In 2014
investments are forecast to grow 4.5 per cent
and in 2015, 4.8 per cent. According to the
economists, the country will have the fifth
highest investments growth rate in the region
in 2014, after Panama, Nicaragua, Costa Rica
and El Salvador.
Albeit buoyed by make-work programmes,
T&T s unemployment in 2014 is forecast to
stay low at 2013 s 5.0 per cent, and fall by
2015 to 4.8 per cent. T&T has the third lowest
unemployment rate according to the econo-
They also said T&T has one of the best
fiscal balances in the region. The deficit that
began to contract in 2012 from -4.3 per cent
of GDP, to -3.0 per cent of GDP in 2013, is
forecast to close at -1.6 per cent of GDP in
Starting September 8, the government began
advertising a 12-year $2.5 billion bond to finance
the deficit of fiscal year (FY) 2013/2014. The
bond, which matures September 23, 2026,
will give bondholders---who would be lending
government to spend more than it earns
through revenue---a fixed rate 2.8 per cent
Economists forecast inflation will continue
to fall from the 2010 five-year high of 13.4
per cent. Inflation fell to 5.3 per cent in 2011,
climbed to 7.2 per cent in 2012, and then slid
to 5.6 per cent in 2013. In 2014, economists
forecast inflation will fall further to 5.0 per
cent, and still further to 4.7 per cent in 2015.
According to the economists, T&T will have
the fifth highest inflation in the Caribbean
basin (Central America and the Caribbean),
after Jamaica (8.7 per cent), Nicaragua (7.1 per
cent), Honduras (6.1 per cent), and Costa Rica
(5.6 per cent).
Using the T&T Central Bank s 2.3 per cent
repo rate as the guide, the economists forecast
T&T will have the lowest interest rates in
Central America and the Caribbean in 2014.
El Salvador, Guatemala and the Dominican
Republic trail T&T, in that order.
As for depreciation of the T&T dollar, the
economists forecast the currency will depre-
ciate the least in the region after Haiti.
In 2013, Costa Rica s and Guatemala s cur-
rencies depreciated the least, followed by the
T&T dollar; but in 2014, the economists fore-
cast only the Haitian and Guatemalan cur-
rencies will stand up to the US dollar better
than the T&T dollar.
Thanks to oil and gas, T&T will continue
to have the best current account balance
growth, as a percentage of GDP, in the region.
The current account balance is forecast to
grow from 10.4 per cent of GDP in 2013 to
10.6 per cent of GDP in 2014, but fall to 9.6
per cent in 2015. Ironically, T&T s export
growth (at 2.1 per cent) is forecast to be the
second worst in the region, after Puerto Rico
(at 0.9 per cent) in 2014. The forecast is con-
sistent with what had been happening in T&T.
Exports from T&T grew 0.5 per cent in 2013,
down from 0.7 per cent growth in 2012, 18.5
per cent in 2011, and 20.3 per cent in 2010.
Exports had contracted -51.1 per cent in 2009.
On the flip side, in 2014, the country is
projected to import at the second slowest
pace in the region, 1.7 per cent.
Puerto Rico s imports will grow the slowest
at 1.2 per cent.
The rate at which T&T was importing
spiked in 2011. In 2009 imports contracted
-27.5 per cent; in 2010, -6.8 per cent; in 2011,
47.4 per cent; in 2012, -1.6 per cent; in 2013,
-0.4 per cent; in 2014, 1.7 per cent is pro-
jected; and in 2015 2.2 per cent growth is
SUNDAY BUSINESS GUARDIAN www.guardian.co.tt SEPTEMBER 21 • 2014
Inflation to fall,
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