Jamaica growth faster than T&T for third year
Jamaica will grow at a projected 1.5 per cent in 2016, which improves on last year and will mean faster economic expansion than its oil-rich neighbour Trinidad and Tobago (T&T), which formerly led the region.
Jamaica's economic growth in 2016 will be the eighth slowest among 33 nations in Latin America and the Caribbean, according to a flagship publication by the regional United Nations (UN) body, Economic Commission for Latin America and the Caribbean (ECLAC).
The Preliminary Overview of the Economics of Latin America and the Caribbean, published late December, indicates that the island will grow faster than Argentina, Barbados, Ecuador, Venezuela, Brazil, St Lucia and T&T. The country grew at a projected rate of one per cent in 2015, which was the sixth slowest in the region. It would become the third straight year that Jamaica will outgrow T&T, which grew in the high single-digits a decade ago.
The report speaks to challenges faced by large commodity economies, including Brazil and Venezuela, which are set to decline. At the same time, it pointed out that small open economies such as Jamaica and Barbados continue to operate with relatively high debt.
"Debt in the Caribbean countries has generally trended upward over the past half-decade and now averages about 80 per cent of the gross domestic product (GDP), with Jamaica having the largest public debt at 131 per cent of GDP," stated the report, adding that Barbados debt is at 111 per cent of GDP.
ECLAC, one of five regional commissions of the United Nations Economic and Social Council, said the region will grow collectively at just 0.2 per cent for 2016. It is the second year that Jamaica will better the regional average.
"A number of scenarios and possible risks in the global economy in 2016 will unquestionably affect the course of economic activity in the Latin American and Caribbean region," said the report "[P]rojections for the next few years are for low global growth, sustained by slow but steady recovery in the developed economies. Serious risks remain, however, which could jeopardise that trajectory."
The report said that aside from the Eurozone's ongoing difficulties, uncertainty has been mounting over the future performance of China and the emerging economies in general.
"In the case of China, the most likely scenarios point to continued economic slowdown, with a growth rate of around 6.4 per cent in 2016," the report said.
"Trends in the emerging economies are clouding the aggregate external demand outlook for the countries of Latin America and the Caribbean. To uncertainties over the growth of the global economy is added the lacklustre growth in trade at 1.5 per cent in 2015, the poorest performance since the crisis of 2007-2009," ECLAC said.