Barbados’ post-COVID economic rebound has entered new territory, growing by four per cent in 2024, surpassing the global average and marking 14 consecutive quarters of expansion, the Central Bank said Wednesday.
Governor Dr Kevin Greenidge highlighted record-breaking international reserves, reduced unemployment, and a narrowing current account deficit as key indicators of the country’s robust economic performance.
Last year was the third straight year of economic growth, with real gross domestic product (GDP) rising by four per cent, surpassing the estimated global rate of 3.3 per cent, the Central Bank said.
Presenting his review of the economy for 2024 during a press conference, Dr Greenidge reported that this expansion also means that the country has achieved 14 straight quarters of growth from the second quarter of 2021 to the fourth quarter of last year.
Describing the economic growth as robust, Dr Greenidge anchored his message on the key indicators.
Inflation dropped by 1.4 per cent; unemployment fell to 7.1 per cent at the end of the third quarter compared with 8.3 per cent for the corresponding period in 2023; the primary surplus rose to 5.3 per cent of GDP; international reserves jumped to a record high of $3.2 billion, an unprecedented increase of 184 per cent over the year; the current account deficit narrowed almost by half, moving from $1.1 billion to $641 million; and the debt-to-GDP ratio continued to contract, coming to 103 per cent by the end of the year.
The governor reported that the improvement in the overall fortunes of the economy was driven by “strong performances” in business services, tourism, construction and retail trade sectors.
“These results underscore the positive effect of targeted economic reforms and provide a solid platform for future sustainable growth,” he said.
“The banks and financial institutions remained quite healthy and well capitalised. Also, credit quality improved, with the non-performing loans dropping, easing from 5 per cent to 4.1 per cent, one of the lowest in history. Credit growth continued to expand, providing some support for the economic growth.”
Dr Greenidge singled out tourism describing its overall performance as very robust with a 7.1 per cent boost in long-stay arrivals compared with 2023.
“This is the United States market,” he pointed out. “We had a 29 per cent growth on the previous year, 2023, quite above our pre-pandemic year. We also had, if I go to the Canadian market, we had a 13 per cent increase in arrivals from Canada over 2023. Still above pre-pandemic levels. The UK market has rebounded to almost capacity. We had a slight easing with 239 000 visitors, compared to 244 000; 2 per cent down. This reflects the issues we are seeing in the UK market in terms of fiscal issues et cetera, but also a drop in airlift from that market.”
The central bank governor added: “In terms of our CARICOM visitors, we had 93 000 tourists versus 89 000 tourists in 2023, 4.7 per cent increase. I should also point out that arrivals meant increased demand for our hotel and accommodations sector.”
Among hotels, the average room occupancy went up one percentage point higher than in the previous year, and also the revenue per available room rose by 12.6 per cent.
Turning to the cruise industry, passenger arrivals for 2024 went up by 40.8 per cent to reach 621 878 visitors. This, Dr Greenidge explained, was supported by 53 additional cruise ship calls to Barbados, all due to the return of the summer cruise programme.
He reported that the success of tourism fed into all other productive sectors resulting in a broad-based sharing of the economic benefits.
On the crucial issue of food security, Dr Greenidge announced that while there were increases in the output for fish, chicken and pork, sugar and food crops declined.
“That reflects the adverse conditions occurring during planting and harvesting. And so, that constrained agriculture output to just one per cent down,” he said.
In providing some perspective on the size of the economy which at the end of 2024 had reached, in nominal terms, $14.3 billion, the largest on record, Dr Greenidge revealed that it is now $10.1 billion in real terms. That, he boasted, is a milestone, having crossed the $10 billion mark.
emmanueljoseph@barbadostoday.bb
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