IMF projects 2.5% growth in Trinidad and Tobago's 2023 GDP

The International Monetary Fund (IMF) has projected economic growth of 2.5 per cent for TT in 2023, a drop from 3.2 per cent growth in its April projection.

In its World Economic Outlook, issued on Tuesday, the IMF further projected a growth in real gross domestic product (GDP) of 2.2 per cent for 2024 and 1.4 per cent for the next five years.

The outlook also projected TT’s current account balance to increase by 5.7 per cent, a considerable drop from 17.9 per cent for 2022.

The current account balance is a key component of a country's balance of payments, which is a record of all its economic global transaction over a specific period, typically a year.

The current account is one of the three major components of the balance of payments, with the other two being the capital account and the financial account.

Regionally, Jamaica’s economy is projected to grow by two per cent. Guyana continues to lead not just the Caribbean but the globe in projected growth, with its outlook of 38.4 per cent. Guyana’s economy is expected to see growth of 26.6 per cent next year and 13.5 per cent by 2028.

Haiti’s economic growth will remain negative, with an outlook of -1.5 per cent this year. Growth is expected to resume slowly in 2024, with a projected growth of 1.4 per cent, and just 1.5 per cent by 2028.

St Vincent and the Grenadines’s GDP is projected to see growth of 6.2 per cent this year.

The global economy has an outlook of 3.5 per cent growth, up from three per cent last year.

Pierre‑Olivier Gourinchas, director, Research Department, IMF, noted these figures were below historical averages.

“The slowdown is more pronounced in advanced economies than in emerging markets and developing economies,” he said. “Among advanced economies, the US has been revised up, with resilient consumption and investment, while the euro area has been revised down, as tighter monetary policy and the energy crisis took a toll.

"There is divergence also among emerging markets and developing economies, with China facing growing headwinds, while Brazil, India and Russia are revised up.”

He said news on inflation is “encouraging,” as headline inflation continues to decelerate and core inflation, excluding food and energy prices, is also projected to decline, but more gradually.

“However, all in all, most countries are not expected to return to inflation target until 2025. Taken together, our projections are increasingly consistent with a soft-landing scenario, bringing inflation down, without a major downturn in activity. This is especially true in the US, where the unemployment rate is now expected to increase only mildly between now and 2025.”