Federation’s economic growth pleases IMF
Saturday February 04 2006
BASSETERRE, ST. KITTS – The International Monetary Fund (IMF) said yesterday it was encouraged by the promising outlook for economic growth in St. Kitts/Nevis.
In a Public Information Notice (PIN) posted on its Web site yesterday, the Washington-based international financial institution said the St. Kitts/Nevis economy, driven by tourism and construction, has rebounded since 2004.
The IMF stated that Real GDP growth in St. Kitts/Nevis exceeded six per cent in 2004, and is projected at almost five per cent this year.
It stated that the surge in tourism since 2003 was facilitated by favourable global growth and large recent investments in infrastructure. Construction activity also rebounded, with a number of new tourism developments and preparations for the 2007 Cricket World Cup underway
The IMF noted that while inflation has been well-contained under the currency board arrangement, higher oil prices are worrisome, although the effect has so far been limited to increasing fiscal costs rather than leading to higher inflation or lower growth.
It said government finances have improved during 2004/05, but the sharp rise in oil prices and prospective investments are constraining further fiscal consolidation.
“Based on the fiscal performance during the first half of 2005, a primary surplus will likely be achieved this year, compared to an average primary deficit of 6.5 per cent of GDP over the previous five years,” according to the IMF.
It pointed out that revenue collection in St. Kitts/Nevis has shown continued strength – owing to the upturn in economic activity and administrative improvements by the Inland Revenue and Customs Departments – but has been mostly offset by increasing current expenditure, in large part reflecting the limited pass-through of higher fuel costs to consumers.
© SUN Printing & Publishing LTD 2003-2004. All Rights Reserved.
Saturday February 04 2006
BASSETERRE, ST. KITTS – The International Monetary Fund (IMF) said yesterday it was encouraged by the promising outlook for economic growth in St. Kitts/Nevis.
In a Public Information Notice (PIN) posted on its Web site yesterday, the Washington-based international financial institution said the St. Kitts/Nevis economy, driven by tourism and construction, has rebounded since 2004.
The IMF stated that Real GDP growth in St. Kitts/Nevis exceeded six per cent in 2004, and is projected at almost five per cent this year.
It stated that the surge in tourism since 2003 was facilitated by favourable global growth and large recent investments in infrastructure. Construction activity also rebounded, with a number of new tourism developments and preparations for the 2007 Cricket World Cup underway
The IMF noted that while inflation has been well-contained under the currency board arrangement, higher oil prices are worrisome, although the effect has so far been limited to increasing fiscal costs rather than leading to higher inflation or lower growth.
It said government finances have improved during 2004/05, but the sharp rise in oil prices and prospective investments are constraining further fiscal consolidation.
“Based on the fiscal performance during the first half of 2005, a primary surplus will likely be achieved this year, compared to an average primary deficit of 6.5 per cent of GDP over the previous five years,” according to the IMF.
It pointed out that revenue collection in St. Kitts/Nevis has shown continued strength – owing to the upturn in economic activity and administrative improvements by the Inland Revenue and Customs Departments – but has been mostly offset by increasing current expenditure, in large part reflecting the limited pass-through of higher fuel costs to consumers.
© SUN Printing & Publishing LTD 2003-2004. All Rights Reserved.
