CONTACT Magazine (Vol.18 No.3 – December 2018)

STATE OF THE NATION
The economic
outlook
The region: Latin America and the Caribbean
According to International Monetary Fund (IMF) reports, challenges have
been mounting in a number of emerging markets and low-income countries,
including some in Latin America.
Many of these economies are feeling pressures from a stronger US dollar and
a tightening of financial market conditions. Facing capital outflows and trade
disputes, they could deliver a shock to a wide range of emerging and developing
economies. 1
For example, Argentina recently experienced a currency crisis, and Brazil has
faced lower business confidence and continued political uncertainty.
Prospects for FDI in Latin America and the Caribbean are expected to improve
in 2019. The IMF has a slightly more optimistic projection than the World Bank.
FDI growth forecasts, Latin America and the Caribbean (%)
2018 2019
IMF 2.0 2.8
World Bank 1.7 2.3
The domestic landscape
The IMF has predicted that the energy sector will grow by 6.0% in 2018 and 2.4%
in 2019 (Article IV Mission Concluding Statement for Trinidad and Tobago). But the
non-energy sector was predicted to contract by 1.8% in 2018 and show zero growth
in 2019. 2
Trinidad and Tobago growth forecasts (%)
Real GDP growth 2018 2019
IMF 1.0 0.9
World Bank 1.6 1.9
Sector growth (IMF)
Energy sector 6.0 2.4
Non-energy sector -1.8 0.0
2019 budget
Trinidad and Tobago’s national budget for the fiscal year 2018-2019 was presented on
1 October by finance minister Colm Imbert. 3 He estimated total revenue at TT$47.724
billion (oil revenue $9.518 billion, non-oil revenue $35.197 billion, capital revenue
$3.009 billion).
The IMF has
predicted that
the energy
sector will
grow by 6.0%
in 2018
Expenditure was estimated at
$51.776 billion (see sidebar) net of
capital repayments and sinking fund
contributions. The fiscal deficit for
2019 is expected to narrow to $4.052
billion or 2.5%.
Major projects announced in
the budget are expected to stimulate
economic activity and contribute to
economic transformation. They include
the Sandals Golden Grove project in
Tobago, a competitively-priced steady
supply of natural gas from Venezuela’s
Dragon Field, two new fast ferries
for the seabridge, radical changes at
Petrotrin (the Petroleum Company of
Trinidad and Tobago), and a new dry
dock and ship-building/ship-repair
facility at La Brea.
The last is a collaboration with
China Harbour Engineering Company
Limited (CHEC), and was signed on 7
September. It is projected to generate
approximately US$500 million annually,
which would represent a 2.4% addition
to T&T’s GDP. During the four-year
construction period, it is expected that
3,500 direct and 5,700 indirect jobs will
be created. 4
The finance minister maintains
that the creation of a growth-inducing
environment that promotes macroeconomic
stability and confidence
is a key condition for ensuring that
recovery takes hold in the non-energy
sector.
44
Trinidad
and Tobago Chamber
of Industry and Commerce
www.chamber.org.tt/contact-magazine