Business Monitor International


West Caribbean Business Forecast Report

Published 26 February 2014

  • 43 pages
  • Instant access to your report online and PDF format through your account library
  • Includes 3 free updated quarterly reports
 
$1,195.00
West Caribbean Business Forecast Report

Core Views:

  • We believe that rising gold production, an improving tourism sector, and strong private consumption levels will continue to drive robust real GDP growth rates in the Dominican Republic in the coming years.

  • We see a high likelihood of a technical debt default by Puerto Rico amid a double-dip recession and a delicate fiscal position. In the actual event of a default, the lack of legal precedent generates significant uncertainty of how it would unfold, though we see high risk of substantial losses for investors.

Major Forecast Changes:

  • We downgraded our real GNP forecast for Puerto Rico from 0.3% to -0.8% for FY 2014. Indeed, high unemployment, fiscal austerity, and weak unemployment will keep the economy in a recession for another year.

  • We revised up our 2014 real GDP growth forecast for the Dominican Republic to 4.5%, from 4.1% previously. Indeed, stronger-than-expected gold exports and robust private consumption prompted us to upgrade our growth outlook for the country.

Key Risks To Outlook:

  • Upside Risks: A stronger than expected economic recovery in the US could lead to larger export receipts, stronger remittances and a boost in tourism for many West Caribbean economies.

  • Downside Risks: There are significant downside risks to our growth and fiscal outlooks for Puerto Rico. We have become increasingly cautious towards the Caribbean commonwealth in recent months due to the rising likelihood of a default, and under such a scenario, the resulting economic recession would likely be deeper and longer than we currently forecast.

Table of Contents

Composite Rating
5
BMI Risk Ratings - Dominican Republic
6
BMI Risk Ratings - Jamaica
7
BMI Risk Ratings - Puerto Rico
8
BMI Ratings - West Caribbean Tables
9
Caribbean SWOTS
10
Executive Summary
13
Core Views
13
Major Forecast Changes
13
Key Risk To Outlook
13
Chapter 1
15
Political Outlook
15
Medina To Shift To More Expansionary Fiscal Policies
15
Chapter 1
17
Economic Activity
17
Mining And Tourism To Drive Stronger Growth
17
table: GDP BY EXPENDITURE, REAL GROWTH %
17
Chapter 2
19
Political outlook
19
Tensions To Heighten As More Austerity Measures Are Implemented
19
Chapter 2
21
Economic Analysis
21
Negative Economic Outlook As Risk Of Debt Restructuring Remains High
21
table: GDP BY EXPENDITURE, REAL GROWTH %
21
Chapter 3
23
Political Outlook
23
Reform Momentum Continues To Build, But Progress Still Incremental
23
Chapter 3
25
Economic Activity
25
Growth To Accelerate, But Headwinds Remain
25
table: GDP BY EXPENDITURE
25
Chapter 4: Country Summaries
27
Aruba
27
Economic Activity
27
table: ECONOMIC ACTIVITY
27
Cuba
29
Political Outlook
29
Bermuda
31
Economic Activity
31
table: MACROECONOMIC FORECASTS
31
Belize
35
Economic Activity
35
Bahamas
37
Economic Activity
37
table: MACROECONOMIC FORECASTS
37
Chapter 5: BMI Global Assumptions
39
Global Outlook
39
Fairly Benign Prognosis
39
Table: Global Assumptions
39
Ta ble: Develop ed States, Real GDP Grow tH, %
40
Ta ble: BMI VE RSUS BL OOMBE RG CONSENSUS REAL GDP GROWTH FORECASTS, %
40
Ta ble: Em erging Mar kets, Real GDP Grow th, %
41

The West Caribbean Business Forecast Report helps businesses with market assessment, strategic planning and decision making to promote growth and profitability in Aruba, the Bahamas, Belize, Bermuda, British Virgin Islands, Cayman Islands, Cuba, Curacao, Dominican Republic, Haiti, Jamaica, Puerto Rico, Turks & Caicos Islands and the US Virgin Islands and is an essential tool for CEOs, Chairmen, Finance Directors/CFOs, Managing Directors, Marketing/Sales Directors with commercial interests in this emerging market..

An influential new analysis of The West Caribbean's economic, political and financial prospects through end-2017, just published by award-winning forecasters, Business Monitor International (BMI).

Key Uses

  • Forecast the pace and stability of The West Caribbean's economic and industry growth through end-2017.
  • Identify and evaluate adverse political and economic trends, to facilitate risk mitigation.
  • Assess the critical shortcomings of the business environment that pose hidden barriers and costs to corporate profitability.
  • Contextualise The West Caribbean's country risks against regional peers using BMI's country comparative Risk Ratings system.
  • Evaluate external threats to doing business in The West Caribbean, including currency volatility, the commodity price boom and protectionist policies.

The West Caribbean Business Forecast Report by Business Monitor International (BMI) includes two major sections: Economic Outlook and Political Outlook.

Economic Outlook:

How will the The West Caribbean economic policy-making and performance impact on corporate profitability over 2013-2017?

BMI provides our fully independent 5-year forecasts for The West Caribbean through end-2017 for more than 50 economic and key industry indicators. We evaluate growth, and also forecast the impact of economic management.

Economic Outlook Contents

The West Caribbean Business Forecast Report features BMI's forecasts with supporting analysis for 2013 through to end-2017, set against government views and BMI's evaluation of global and regional prospects.

Key Areas Covered:

Data:

  • Full 10-year forecasts with data - for key macroeconomic variables including GDP (real growth and per capita), population, inflation, current account balance and the exchange rate.
  • BMI's comprehensive Risk Ratings system - rates each country worldwide for economic and political risk, and rates the business environment, within a global and regional context.

Written Analysis:

  • Economic Activity - real GDP growth, employment, inflation, consumption (retail sales and confidence).
  • Balance of Payments - trade and investment, current and capital account.
  • Monetary Policy - interest rate trends (bank lending and deposit rates) and inflation (producer price and consumer price).
  • Exchange Rate Policy - currency controls, foreign investment flows, exchange rates and foreign exchange reserves.
  • Fiscal Policy - macroeconomic strategy and policies, government finance and tax reforms.
  • Foreign Direct Investment - approvals, inflows and climate.
  • External Debt - debt profile (short and long-term plus public and private sector exposure).
  • Global Assumptions - forecasts for each year to end-2017 covering: major commodities, growth in key regions, inflation, and interest and exchange rates, in the United States, Japan, China and the eurozone.

Key Benefits

  • Rely upon BMI's 100% independent forecast scenarios for The West Caribbean and underlying assumptions - we take no advertising and are privately-owned.
  • Exploit the benefits of BMI's comprehensive and reliable macroeconomic database on The West Caribbean, sourced and fully maintained by BMI from an extensive network of private sector, government and multilateral contacts.
  • Gain key insights into the current and future direction of government economic policy, which could significantly affect your company's business prospects, from BMI's team of analysts and economists.

Political Outlook:

What are the political risks to doing business in The West Caribbean over the next 5-years?

BMI's The West Caribbean country Risk Ratings evaluate the short- and medium-term threats to political stability.

Political Outlook Contents

  • SWOT Analysis for the The West Caribbean Market - Political Strengths, Weaknesses, Opportunities and Threats facing The West Caribbean.
  • Political Stability and Risk Assessment - BMI's Risk Ratings assess explicit short- and long-term risks to political stability; latest ratings, rankings and trends for The West Caribbean's risk are compared with regional and global averages.
  • Current Administration and Policy-making BMI assesses the threats to the continuity of economic policy, and likely changes to the business operating environment.

Key Benefits

  • Benchmark The West Caribbean's risk profile against its neighbours, the global and regional average, allowing easy comparison of risks between key business markets.
  • Identify, evaluate and anticipate political and security risks to the business environment, and to your company's current operations and future plans.
  • Gain valuable insights into government and policy-making, through BMI's specialist team of analysts and economists, and their network of private and public sector sources.

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Testimonials

The sections that I find most interesting and useful are the macroeconomic data and forecasts for the country, top export destinations and economic activity. The indicators/analysis of these areas helps us orient our thinking, our assumptions and, consequently, our decisions in the commercial area.

Country Manager, DHL Express