Country Report Organisation of Eastern Caribbean States June 2009

Publication Date	June 2009
Publisher	EIU
Product Type	Report
Pages	32
ISBN Number	not applicable
Product Code	EIU01782

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Summary

Outlook for 2009-10

Despite a severe economic downturn in 2009, the eight members of the Organisation of Eastern Caribbean States (OECS) will continue to enjoy broad political stability during the forecast period. Following March elections in Antigua-Barbuda, no other OECS country is scheduled to hold general elections in 2009. However, elections in St Kitts-Nevis, Dominica and Anguilla are due by mid-2010 and may be called earlier. Ambitious targets for further economic and political integration within the OECS will remain under discussion, but finding the unity and political will to carry the process forward will prove difficult in practice, particularly as the region attempts to deal with mounting economic challenges. Prospects for real GDP growth in the OECS during the forecast period are weak. A sharp downturn in world economic conditions, and in particular the international financial crisis and a deep contraction in demand in the US and UK, will push most OECS economies into recession in 2009; recovery in 2010 will be slow. In those countries that do not rely heavily on tourism, such as StVincent and the Grenadines and Dominica, growth will be held back by the uncertain future of the bananaindustry.

Summary

As the region struggles to cope with the onset of the global recession, the countries of the OECS have agreed to an implementation date of June 18th 2010 for a long-planned deepening of their economic integration, which would formally transform the grouping from a regional free-trade area to an economic union. Trinidad and Tobago may join the union by 2011. With US demand down sharply as a result of a deep recession, key tourism markets such as Antigua-Barbuda and Saint Lucia experienced double-digit declines in arrivals in early 2009. Most businesses in the OECS remain pessimistic about the economic outlook. Real GDP growth in Anguilla was flat in 2008 following double-digit average annual growth in the previous three years. The governing United Progressive Party (UPP) retained power at a general election in Antigua-Barbuda on March 12th, with Baldwin Spencer winning a second five-year term as prime minister, albeit with a reduced parliamentary majority. Relations between Grenada and Taiwan continue to deteriorate as a result of Grenada's failure to repay a US$25m debt. St Kitts-Nevis is moving ahead with its geothermal energy programme, the first in the Eastern Caribbean. St Vincent and the Grenadines has announced plans to join ALBA, a Venezuelan-led alliance, as a full member.

This report covers the following industry codes:
SIC Code: 70;60;15;49
NAICS Code: 72;52;23;22;11

Content

Summary
Anguilla: political and economic structure
Anguilla: political and economic structure: Annual indicators
Antigua and Barbuda: political and economic structure
Antigua and Barbuda: political and economic structure: Annual indicators
Dominica: political and economic structure
Dominica: political and economic structure: Annual indicators
Grenada: political and economic structure
Grenada: political and economic structure: Annual indicators
Montserrat: political and economic structure
Montserrat: political and economic structure: Annual indicators
St Kitts-Nevis: political and economic structure
St Kitts-Nevis: political and economic structure: Annual indicators
Saint Lucia: political and economic structure
Saint Lucia: political and economic structure: Annual indicators
St Vincent and the Grenadines: political and economic structure
St Vincent and the Grenadines: political and economic structure: Annual indicators
Outlook for 2009-10
Outlook for 2009-10: Global economic slowdown will hurt OECS growth
Outlook for 2009-10: High debt levels will remain a damper on growth
Outlook for 2009-10: Crime will continue to have an economic impact
Outlook for 2009-10: The OECS will remain vulnerable to natural disasters
Review: OECS to move to economic union by 2010
Review: Trinidad and Tobago may join OECS by 2011
Review: Tourist arrivals down sharply
Review: Business confidence falls
Review: OECS financial sectors under increased scrutiny
Anguilla: Economy heavily exposed amid global recession
Antigua and Barbuda: Governing party retains power at general election
Dominica: Prospect of early general election rises
Dominica: Dominica maintains position on whaling
Grenada: Taiwan demands repayment of US$25m loan
Grenada: Fiscal stimulus to focus on capital spending
Montserrat: Growth accelerated in 2008 on construction boom
Montserrat: New airline to provide competition
St Kitts and Nevis: Emergency IMF funds agreed following hurricane damage
St Kitts and Nevis: Nevis moving closer to geothermal energy generation
St Lucia: Economic growth slows on weakening construction
St Lucia: 2008/09 budget focused on boosting growth
St Lucia: Revenue shortfall leads to widening of fiscal deficit
St Vincent and the Grenadines: PM commits to join ALBA
St Vincent and the Grenadines: IMF funding secured as economy slows
St Vincent and the Grenadines: Strong revenue results in first primary surplus since 2002
The region: Summary
Outlook for 2009-10: Broad political stability will be maintained
Outlook for 2009-10: Regional integration will advance slowly
Outlook for 2009-10: Economic downturn will impact public finances
Outlook for 2009-10: The tourism sector will be hit by the global downturn
Outlook for 2009-10: Tighter global liquidity threatens resource investments
Outlook for 2009-10: The outlook for agriculture is mixed
Outlook for 2009-10: Financial sectors' performance will vary across the region
Outlook for 2009-10: Crime will remain a major security concern
Recent developments: Frustration rising over slowness of response to crisis
Recent developments: CRNM to be absorbed into Caricom Secretariat
Recent developments: Caribbean countries seek assistance from IMF
Recent developments: Tourist arrivals decline sharply as global recession bites