East Caribbean Business Forecast Report Q3 2014

East Caribbean Business Forecast Report Q3 2014

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Published on May 28, 2014 - 45 pages

Core Views:
  • We believe that the East Caribbean region will continue to see a modest economic recovery in the coming quarters, anticipating that the region's more diversified economies will benefit from slightly stronger global growth. Meanwhile, those countries most reliant on tourism and financial services will continue to struggle, as we expect these industries are unlikely to return to pre-crisis levels in the foreseeable future.
  • We expect that Caribbean economies will continue to face economic headwinds in the coming years in light of rising debt burdens, fixed exchange rate regimes, and modest growth prospects. These factors, combined with our view that neither the tourism nor financial services sectors will see a significant recovery in the next few years, mean that we do not rule out additional credit events or major balance of payments corrections in some of the small island economies.
  • Should the Venezuelan government significantly alter the terms of its Petrocaribe programme, which provides subsidised oil imports to many Caribbean economies, it could send import bills much higher and potentially cause some countries to default on their outstanding oil loans.
Major Forecast Changes:
  • We have revised our current account forecasts for Guyana to account for wider shortfalls in the coming years. Indeed, we forecast the current account deficit to come in at 15.7% of GDP (12.5% previously), slightly narrower than an estimated 17.0% of GDP in 2013 (previously 14.3%). Indeed, Guyana's current account balance deteriorated more than we anticipated in the first three quarters of 2013, and we expect that the price of gold, one of the country's main exports, will remain under pressure in the coming quarters.
  • We have revised our current account forecast for 2014 to reflect a deficit of 10.3% of GDP, down from an estimated 14.3% of GDP in 2013. This change is due to our expectation that depressed private consumption growth will weigh on imports of goods and...
The East Caribbean Business Forecast Report helps businesses with market assessment, strategic planning and decision making to promote growth and profitability in Anguilla, Antigua & Barbuda, Barbados, Dominica, Grenada, Guyana, Montserrat, St Kitts & St Nevis, St Lucia, St Maarten, St Vincent & The Grenadines, Suriname and Trinidad & Tobago and is an essential tool for CEOs, Chairmen, Finance Directors/CFOs, Managing Directors, Marketing/Sales Directors with commercial interests in this emerging market..

An influential new analysis of The East Caribbean's economic, political and financial prospects through end-2017, just published by award-winning forecasters, Business Monitor International (BMI).

Key Uses
  • Forecast the pace and stability of The East Caribbean's economic and industry growth through end-2017.
  • Identify and evaluate adverse political and economic trends, to facilitate risk mitigation.
  • Assess the critical shortcomings of the business environment that pose hidden barriers and costs to corporate profitability.
  • Contextualise The East Caribbean's country risks against regional peers using BMI's country comparative Risk Ratings system.
  • Evaluate external threats to doing business in The East Caribbean, including currency volatility, the commodity price boom and protectionist policies.
The East Caribbean Business Forecast Report by Business Monitor International (BMI) includes two major sections: >Economic Outlook and >Political Outlook.

Economic Outlook:

How will the the East Caribbean economic policy-making and performance impact on corporate profitability over 2013-2017?

BMI provides our fully independent 5-year forecasts for The East Caribbean through end-2017 for more than 50 economic and key industry indicators. We evaluate growth, and also forecast the impact of economic management.

Economic Outlook Contents

The East Caribbean Business Forecast Report features BMI's forecasts with supporting analysis for 2013 through to end-2017, set against government views and BMI's evaluation of global and regional prospects.

Key Areas Covered:

  • Full 10-year forecasts with data - for key macroeconomic variables including GDP (real growth and per capita), population, inflation, current account balance and the exchange rate.
  • BMI's comprehensive Risk Ratings system - rates each country worldwide for economic and political risk, and rates the business environment, within a global and regional context.
Written Analysis:
  • Economic Activity - real GDP growth, employment, inflation, consumption (retail sales and confidence).
  • Balance of Payments - trade and investment, current and capital account.
  • Monetary Policy - interest rate trends (bank lending and deposit rates) and inflation (producer price and consumer price).
  • Exchange Rate Policy - currency controls, foreign investment flows, exchange rates and foreign exchange reserves.
  • Fiscal Policy - macroeconomic strategy and policies, government finance and tax reforms.
  • Foreign Direct Investment - approvals, inflows and climate.
  • External Debt - debt profile (short and long-term plus public and private sector exposure).
  • Global Assumptions - forecasts for each year to end-2017 covering: major commodities, growth in key regions, inflation, and interest and exchange rates, in the United States, Japan, China and the eurozone.
Key Benefits
  • Rely upon BMI's 100% independent forecast scenarios for The East Caribbean and underlying assumptions - we take no advertising and are privately-owned.
  • Exploit the benefits of BMI's comprehensive and reliable macroeconomic database on The East Caribbean, sourced and fully maintained by BMI from an extensive network of private sector, government and multilateral contacts.
  • Gain key insights into the current and future direction of government economic policy, which could significantly affect your company's business prospects, from BMI's team of analysts and economists.
Political Outlook:

What are the political risks to doing business in The East Caribbean over the next 5-years?

BMI's The East Caribbean country Risk Ratings evaluate the short- and medium-term threats to political stability.

Political Outlook Contents
  • SWOT Analysis for the the East Caribbean Market - Political Strengths, Weaknesses, Opportunities and Threats facing The East Caribbean.