Upward onward: Bajan excellence 2030
Economic overview
Economic overview
The Barbados economy faced a challenging year in 2022, as it was adversely
impacted by rising global inflation. However, economic activity recovered from the
COVID-19 pandemic lows during 2020 and 2021. This performance was driven by
the tourism sector which benefited from eases in COVID-19 travel restrictions.
Ripple effects from the economic growth were reduced unemployment and
unemployment claims, bolstering the strength of the labour market.
Barbados successfully completed an IMF Programme Extended Fund Facility (EFF)
in 2018-22 and were successful in obtaining a 36 month US$113m successor EFF
program along with a Resilience and Sustainability Facility (RSF) of US$189m to
strengthen fiscal sustainability, support the structural reform agenda, and building
resilience to natural disasters and reducing greenhouse gases.
The new EFF will allow for the continuation of the structural reform agenda
strengthening of tax and customs administration as well as Public Financial
Management, adoption and implementation of pension reform, the rationalisation
and consolidation of State-Owned Enterprises.
The RSF is meant to assist with the goal of transitioning to a fully renewable-based
economy by 2030 and includes measures to incentivize private sector investments
in climate resilient infrastructure and into renewable energy projects.
Barbados Economic Recovery and Transformation Programme 2022 (BERT) seeks
to achieve growth in public and private sector investment in the move to a green
economy - renewable energy generation, transport, tourism, housing and
agricultural sectors through attractive Government incentives.
Economic Variable
2018
2019
2020 2021 (p) 2022 (e)
Fiscal Balance-to-GDP (%)
-4.5
-0.3
3.6
-4.8
-4.8
Real GDP Growth Rate (%)
-1.0
-0.2
-13.5
-0.3
10.0
Inflation (%)
3.7
4.2
3.5
2.7
8.5*
Unemployment (%)
11.6
8.9
13.6
10.9 7.1**
Public Sector Debt-to-GDP (%)
126.0
117.4 137.1
137.9
123.8
*- data as at November 2022
**- data as at September 2022
(p) - provisional
(e) - estimated
Source: Central Bank of Barbados, PwC
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PwC | 2023/24 Budget review | Barbados
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