Antigua/Barbuda’s aggressive fiscal consolidation fosters 4.8% growth: CARICOM BUSINESS
The economy of Antigua and Barbuda recorded growth of at 4.8% for 2021, following a sharp contraction of 20.2% in 2020.
That’s the word of the IMF at the conclusion of the recent Article IV Consultations. A sustained recovery in tourism and construction activity is expected to underpin real output growth of 7% in 2022. Fiscal consolidation resumed in 2021 and the primary deficit narrowed to 1.8% of GDP (from 3.8% in 2020) reflecting domestic revenue mobilization, external grants, and the reprioritization of spending. This is congruent with Antigua’s medium-term fiscal strategy to bring public debt-to-GDP to under 70% by 2030.
The 2022 budget envisages a zero primary balance, with an ambitious capital spending plan financed by higher revenues, grants and borrowing. Banks are well-capitalized and liquid, but credit growth has been slow, particularly to households. Loans under moratoria at banks and credit unions have declined significantly in 2021 and nonperforming loan ratios have remained stable. (IMF)
Extract from the CARICOM BUSINESS Newsletter, Vol 5 No 8
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