…economy projected to grow 3.8 per cent

Finance Minister, Winston Jordan on Monday unveiled a $267.1B budget for 2018 and projected that the economy will grow at 3.8 per cent next year. He anticipated that growth will be realised across all sectors, with the exception of the sugar industry.

Presenting his fourth budget themed “The Journey to the Good Life Continues”, Finance Minister, Winston Jordan said minus the weight of the sugar industry, the non-sugar growth rate is expected to be 4.6 per cent.
The overall real growth rate for 2017 was projected at 3.8 per cent but at mid-year, an economic growth rate of 2.2 per cent was achieved, up from two per cent for the same period the previous year.

In the Mid-Year Report, laid in the National Assembly, on August 4, the projection for 2017 was revised downwards to 3.1 per cent, on account of expected weak performance in the mining and quarrying sector, and the sugar and forestry industries.
The projected outturn for real growth of the economy, in 2017, is 2.9 per cent.
According to Jordon, the global economic growth is expected to improve through 2017 as markets benefit from increased investment, trade and industrial production, as well as reinvigorated business and consumer confidence.

The International Monetary Fund (IMF), in its most recent World Economic Outlook (WEO), has projected global growth to reach 3.6 per cent in 2017, 0.4 percentage points higher than the level recorded in 2016, and 0.1 percentage points above its previous forecast.
In 2018, the global growth is projected to rise marginally to 3.7 per cent.

“Mr. Speaker, advanced economies are projected to grow by 2.2 per cent in 2017 as a result of various factors, including an increase in global demand, stronger exports, and supportive fiscal and monetary policy. In 2018, growth in this area is anticipated to decline to 2 per cent on account of a lower expected growth in all major economies, apart from the United States and France. The United Kingdom expects to see declining growth as the effects of Brexit continue to take a toll on the economy, with a dampening of consumption growth due to a weakening of the pound,” the finance minister said.

In addition, Jordan told the House that economic expansion in emerging markets and developing economies is anticipated to improve from earlier projections, with 4.6 per cent growth expected for 2017, 0.3 percentage points above the growth recorded in 2016.
The Chinese economy was sustained by buoyant external demand, which is anticipated to support further expansion in growth, in 2018, to 4.9 per cent.

The economies of Latin America and the Caribbean are expected to finally recover, in 2017. Following significant declines over the past few years, growth of 1.2 per cent and 1.9 per cent is expected in 2017 and 2018, respectively.
The anticipated recovery in the region will be supported by improved demand from external trading partners and accommodative financial conditions, on account of a less volatile international financial market and resilient capital inflows.

In the Caribbean, overall growth projections for 2018 show an improvement to 1.9 per cent from 0.3 per cent the previous year. However, Trinidad and Tobago and Suriname are projected to contract by 3.2 per cent and 1.2 per cent, respectively, as the downturn in the previous years extend into 2017.

In 2018, however, these economies are expected to recover and, as a group, both tourism-dependent and commodity exporters are projected to record over 2 per cent respectively, with Trinidad and Tobago projected to expand by 1.9 per cent, and Suriname by 1.2 per cent as prices are anticipated to rebound.

“Despite the improved outlook, the region still faces a number of risks, including climate-related catastrophes, which are expected to increase in frequency; capital flow reversals; tightening financial conditions; and volatile commodity prices,” Jordon said.