Caribbean Faces Tough Macro Outlook
Global crisis has spanked the Caribbean and the bad news just keeps coming. Amid contracting liquidity, the region is pained by bruised tourism revenues and battered remittances.
by Taina Rosa
Global economic slowdown comes at a perilous time for the fragile Caribbean. Evaporating liquidity, declining tourism and flopping remittances come on the heels of storms and an increase in food prices.
This all puts the brakes on regional growth. BCP Securities expects Caribbean GDP expansion to slow to 0.4% in 2009 from 3.5% in 2008 and 7.0% in 2007. The biggest contractions in GDP, the shop estimates, will happen in Jamaica, set to shrink by 3.5% this year.
Most Caribbean countries are highly exposed to the US economy as the US is their main trading and investment partner, and as a result, some regional economies are expected to contract substantially, says Neeraj Arora, LatAm strategy associate at JPMorgan.
The regions largest economy, the Dominican Republic, saw GDP increase 5.3% in 2008, but it is not expected to see any growth...
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