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Barbados Achieves Record-Breaking Foreign Reserves and Economic Growth in 2024 Despite Challenges: Central Bank Report
Barbados achieves record foreign reserves of $3.2 billion in September 2024 amid 3.9% economic growth. Potential food price increases warned due to global uncertainties and import reliance.
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Originally published by barbadostoday.bb (opens in new tab)
Barbados has recorded its highest-ever foreign reserves of $3.2 billion for September, while achieving economic growth of 3.9 per cent in the first nine months of 2024, despite challenges from Hurricane Beryl and global economic uncertainties, the Central Bank of Barbados reported Wednesday.
However, Barbadians have been put on notice of potential increases in food prices later this year.
Delivering the bank’s report card on the performance of the economy for the first nine months of this year, Governor Dr Kevin Greenidge said the economy maintained steady growth driven by tourism, business services and construction industries.
He added: “Inflation moderated, unemployment fell, and the country’s external position remained robust, marked by the highest end-September international reserves level, equivalent to 31.2 weeks of imports of goods and services.”
“The economic outlook is positive and bright, despite growing geopolitical uncertainty,” he assured, forecasting that the economy will maintain its growth momentum through year-end, with real GDP expanding by approximately 3.8 per cent.
However, the top economist informed the country that because much of what residents consume is imported, the bank is limited in its capacity to implement any monetary ease which could cushion price increases.
He pointed to some potential food price hikes for the year ahead.
“The domestic inflation rate is expected to slow further, with the 12-month moving average stabilising between 2 and 3 per cent by year-end. This forecast assumes easing international food and energy prices from their 2022 peaks. However, global challenges—including escalating geopolitical tensions, potential oil price hikes, and disruptions related to the Red Sea crisis and Panama Canal water shortages—could increase freight costs and impact supply chains. Domestically, adverse weather could further strain agricultural output, pushing up local food prices,” the governor said.
He also reported a steady decline in the debt-to-GDP ratio, which now stands at 105.6 per cent. Greenidge said this achievement reflected Barbados’ resilience in managing external shocks while continuing to reduce its reliance on new debt.
Reporting on the drivers of economic growth for the first three quarters of 2024, Greenidge said there were significant increases in long-stay visitor arrivals.
Long-stay visitors increased by 12.9 per cent over the first nine months of 2024. Although there was a slight decline in flights from the UK and Europe during the third quarter, strong performance earlier in the year, along with an increase in cruise activity, offset the slowdown.
