Caribbean Economic Growth Projections

News Americas, New York, NY, March 19, 2025: The Caribbean Development Bank (CDB) has projected 2.5% economic growth for its 19 borrowing member countries in 2025, following 1.7% growth in 2024, excluding Guyana, which saw a remarkable 43.5% expansion last year.

At the CDB’s annual news conference, Director of Economics Ian Durant stated that Guyana’s economy is expected to slow to 11.9% growth in 2025, following its surge in oil production. However, the country will remain a key driver of regional economic expansion. With Guyana included, the overall growth forecast for the region rises to 4.6%.

Economic Outlook

Economic Drivers and Risks

Growth will vary across CDB member states, with commodity-exporting nations expected to gain momentum, and service-based economies, particularly in tourism, forecasted to grow by 2.2%. Construction, driven by public and private investments, will also contribute to economic expansion.

However, Durant warned that several global and regional risks could impact economic performance. Geopolitical tensions, protectionist trade policies, and potential slowdowns in key markets like the United States could affect demand for Caribbean exports. Climate change and natural disasters remain significant concerns, especially as hurricanes and extreme weather events intensify.

Fiscal Outlook and Policy Challenges

Most Caribbean governments are expected to maintain primary budget surpluses, strengthening debt positions. However, with many Caribbean countries facing elections in 2025 and 2026, there is a risk of fiscal pressures and policy shifts that could slow economic reforms.

Despite these challenges, the Caribbean is recovering from recent economic shocks, including COVID-19, supply chain disruptions, and high inflation. The CDB remains optimistic that continued investment and resilience-building efforts will sustain positive economic growth across the region.

Conclusion

In conclusion, the Caribbean Development Bank’s economic growth projections for 2025 indicate a positive outlook for the region, with some countries expected to experience significant growth. However, there are also risks and challenges that need to be addressed, including geopolitical tensions, climate change, and potential slowdowns in key markets.

Frequently Asked Questions

Q: What is the projected economic growth for the Caribbean region in 2025?

A: The Caribbean Development Bank has projected 2.5% economic growth for its 19 borrowing member countries in 2025, excluding Guyana.

Q: Which country is expected to experience the highest economic growth in 2025?

A: Guyana is expected to experience 11.9% economic growth in 2025, following its surge in oil production.

Q: What are the main risks and challenges facing the Caribbean region in 2025?

A: The main risks and challenges facing the Caribbean region in 2025 include geopolitical tensions, protectionist trade policies, potential slowdowns in key markets, climate change, and natural disasters.