A general overview of the macroeconomic issues facing the Caribbean as presented by Ian Durant, Deputy Director, Economics, CDB on July 10, 2017 at a conference titled, 'Chinese Renminbi in the Caribbean-Opportunities for Trade Aid and Investment,' held at the Hilton Barbados Resort.

1. GENERAL OVERVIEW OF
MACROECONOMIC
ISSUES FACING THE
CARIBBEAN
Ian Durant
Deputy Director, Department of Economics
10 July 2017

2. THE REGIONAL
PICTURE

3. POVERTY
UNACCEPTABLY
HIGH IN MOST
COUNTRIES
Source: Statistics Offices
58.5 (2012)
41.3 (2009)
37.7 (2008)
36.1 (2006)
36.0 (2009)
30.2 (2009)
29.0 (2005)
28.8 (2009)
22.0 (2012)
22.0 (2002)
21.8 (2009)
19.3 (2009)
18.0 (2006)
17.0 (2007)
16.5 (2009)
9.3 (2001)
5.8 (2009)
1.9 (2008)
HAI
BZE
GRE
GUY
MON
SVG
SLU
DOM
TCI
BVI
SKN
BAR
ANT
TT
JAM
BAH
ANG
CAY
Poverty Rates
(% of Population below Poverty Line)

4. LOW GROWTH
ENVIRONMENT
Source: CDB estimates, IMF, UN
(6)
(4)
(2)
0
2
4
6
8
10
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Real GDP growth (%) 2006 to 2016
World Advanced economies
Emerging market and developing economies CDB BMCs
Other SIDS

5. 2016
ECONOMIC
GROWTH
Source: Statistics Offices, ECCB, CDB estimates
3.8
4.3
0.0
1.6
-0.8
-0.6
3.2
1.0
1.9
3.3
1.1
1.4 1.3
3.0
0.9
2.0
-10.4
-5.7
4.4
-1.3
-6.0
-4.0
-2.0
0.0
2.0
4.0
6.0
2016 GDP Growth (%)

6. COMMODITY
PRICES STILL
RELATIVELY LOW
&
RATE OF
VISITORS
ARRIVALS HAS
DECLINED
50
60
70
80
90
100
110 Gold Index: Jan 12 – May 17
0
20
40
60
80
100
120
Crude (US$/bbl) Jan 12 - May 17
Stayover Arrivals
Sources: IMF, CTO
2014 2015 2016
+5.9%
+4%
+1.7%

7. IN GENERAL,
UNEMPLOYMENT
HAS NOT FALLEN
SUFFICIENTLY
Source: Statistics Offices
-
5.0
10.0
15.0
20.0
25.0
BAH BAR BZE CAY JAM SLU TT SUR
%
Unemployment Rate
2004 2010 2016

8. FDI HAS VARIED,
WITH NO
SIGNIFICANT
INCREASE
Source: UNCTAD
0
0.1
0.2
0.3
0.4
0.5
0.6
-
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
%
USDMillions
Caricom: Inward FDI 2000 - 2015
Inward FDI Share of World FDI (RHS)

9. KEY TO A
GOOD
INVESTMENT
CLIMATE
Source: World Bank Group
Country 2017 2016
Difference 2016-
2017
NZ 1 1 0
SIN 2 3 1
MAU 49 42 -7
JAM 67 65 -2
SLU 86 78 -8
TT 96 92 -4
DOM 101 95 -6
BZE 112 110 -2
ANT 113 107 -6
BAR 117 115 -2
BAH 121 120 -1
GUY 124 140 16
SVG 125 123 -2
SKN 134 127 -7
GRE 138 131 -7
SUR 158 155 -3
HAI 181 180 -1
Regional
Average 120 117 -3

10. REMITTANCES
CONTINUING TO
INCREASE
GRADUALLY….
-
1,000
2,000
3,000
4,000
5,000
6,000
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
USDMillions
Total Inward Remittances 2000-2016
Source: World Bank

11. …AND ARE
STILL
SIGNIFICANT
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
ANT BAR BZE DOM GRE GUY HAI JAM SKN SLU SVG SUR TT
Remittances as a Share of GDP 2016
Source: World Bank

12. HIGH DEBT
ACROSS
BMCs
Source: Statistics Offices, Central Banks
Debt as a % of GDP
2015 2016 Change in
%
Primary
Balance (%
of GDP)
Real GDP
growth
BAR 140.4 145.3 4.9 -5.0 1.6
JAM 124.8 120.3 -4.5 7.7 1.4
ANT 99.1 93.6 -5.5 7.0 4.3
BZE 81.7 90.4 8.7 -1.1 -0.8
DOM 85.5 87.7 2.2 0.0 1.0
GRE 91.7 83.4 -8.3 5.3 1.9
BAH 66.9 69.3 2.4 0.4 0.0
SLU 65.4 66.4 1.0 2.2 0.9
SKN 70.6 65.6 -5.0 1.9 3.0
TT 50.0 56.6 6.6 -4.1 -5.7
SUR 43.5 55.5 12.0 -5.3 -10.4
GUY 48.3 49.6 1.3 -2.0 3.3
ANG 24.6 44.3 19.7 3.3 3.8
HAI 30.1 33.6 3.5 -1.0 1.1

13. DAMAGE
FROM
EXTREME
WEATHER
EVENTS
Country Year Disaster Damage
(% of
GDP)
Belize 2000 Storm 33
Grenada 2004 Hurricane 200
Guyana 2005 Flood 36
Dominica 2009 Hurricane 35
Haiti 2010 Earthquake 121
Saint Lucia 2011 Hurricane 34
Dominica 2015 Flood 96
Source: EM-DAT, IMF

14. DE-RISKING AND
ACCESS TO
GLOBAL
FINANCIAL
SERVICES
Source: IMF

15. CBR Withdrawal
Key Drivers
AML/CFT
Sanctions
Profitability
High Risks
Impacts
Trade
Remittances
Financial
Stability

16. CHANGE IN
TRANSACTIONS
AND CBRs
SWIFT
Volume (%
change)
SWIFT
Value (%
change)
CBRs
(%
change)
Antigua and Barbuda 4.0 1.9 -12.6
Bahamas 23.8 -38.5 -15.1
Barbados 13.4 -50.8 -13.6
Belize -44.6 -44.2 -16
Cayman Islands 20.1 -31 -9.9
Dominica 3.4 -14.3 -9.7
Grenada 19.1 13 13.5
Guyana 15.2 -21.2 -0.2
Haiti 26.2 10.9 -11.8
Jamaica 38.5 35.4 13.7
St Kitts and Nevis 12 4 -18.3
Saint Lucia 10.9 6.7 1.8
St Vincent -14.1 -21.4 -1.8
Suriname -8.7 -15.6 -11.3
Trinidad and Tobago 14.9 -1.4 -21.8
Source: FSB

17. FOREIGN
CURRENCY
RESERVES
BELOW
BENCHMARK
LEVEL
Benchmark
3.0
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
BAH BAR BZE GUY JAM SUR TT ECCU
MonthsofImports
2014 2015 2016

18. REGION
EXPECTED
TO GROW IN
2017
Source: CDB forecasts, IMF
3.1
3.4
1.4
1.1
2.2 2.3
3.2 3.2
2.7
3.5
2.3
2.1
1.7
3.5
0.7
2.5
-1.2
1.0
4.3
1.7
5.2
-2.0
-1.0
0.0
1.0
2.0
3.0
4.0
5.0
6.0
2017 GDP Growth (%)

19. THANK
YOU