Central Bank of Trinidad and Tobago.

Trinidad and Tobago’s economy is expected to contract by one per cent this year, the International Monetary Fund has projected in its latest World Economic Outlook.

This is a drop from the projection of economic growth of 2.1 per cent that the IMF had predicted in July.

According to the IMF, T&T is expected to experience economic growth of 5.4 per cent next year with growth of 1.6 per cent projected for 2026.

Of all the countries in the Latin America and Caribbean region, Guyana is expected to register the highest level of economic growth, the IMF projected.

Guyana is projected to experience economic growth of 20.4 per cent this year.

Overall the LAC region is expected to record economic growth of 6.3 per cent in 2021, the IMF stated.

“Compared to our July forecast, the global growth projection for 2021 has been revised down marginally to 5.9 percent and is unchanged for 2022 at 4.9 per cent,” Gita Gopinath, the Economic Counsellor and Director of Research, stated.

“This modest headline revision, however, masks large downgrades for some countries. The outlook for the low-income developing country group has darkened considerably due to worsening pandemic dynamics. The downgrade also reflects more difficult near-term prospects for the advanced economy group, in part due to supply disruptions. Partially offsetting these changes, projections for some commodity exporters have been upgraded on the back of rising commodity prices. Pandemic-related disruptions to contact-intensive sectors have caused the labour market recovery to significantly lag the output recovery in most countries,” she stated.

Gopinath stated that the dangerous divergence in economic prospects across countries remains a major concern.

“These economic divergences are a consequence of large disparities in vaccine access and in policy support,” she stated.

Gopinath stated that recent developments have made it abundantly clear that we are all in this together and the pandemic is not over anywhere until it is over everywhere.

“If COVID-19 were to have a prolonged impact into the medium term, it could reduce global GDP by a cumulative $5.3 trillion over the next five years relative to our current projection. It does not have to be this way. The global community must step up efforts to ensure equitable vaccine access for every country, overcome vaccine hesitancy where there is adequate supply, and secure better economic prospects for all,” she stated.