Business Monitor International


West Caribbean Business Forecast Report

Published 28 May 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, a gradually improving tourism sector, and stronger private consumption growth will drive robust real GDP growth rates in the Dominican Republic in the coming years.

  • We expect Puerto Rico to remain in a recession through fiscal year 2015 amid high unemployment and weak investment, and see a high likelihood of debt restructuring by the commonwealth's electric power authority (PREPA) this year.

  • We expect the Cuban economy to accelerate in the coming years, on the back of the government's drive to attract greater levels of investment, and on continued expansion of the consumer sector. This will help to offset weakness in the export sector, and rising demand for imports. 

Major Forecast Changes:

  • We revised up our 2015 real GDP growth forecast for the Dominican Republic to 4.3%, from 3.9% in our previous projection, due to strengthening exports and private consumption.

  • Key Risks To Outlook:

  • Upside Risk: Despite an economic contraction in the United States in the first quarter of the year, other indicators, as well as the Q2 GDP print, suggest that the consumer sector in the US and other developed states may be picking up pace at a more rapid pace than we previously envisioned. This could lead to a more robust recovery in the tourism sector, posing upside risks to our growth and current account forecasts across the Caribbean region.

  • Downside Risk: With little domestic production of staple goods, many Caribbean countries are highly vulnerable to global food price shocks, and while our Agribusiness team currently forecast lower average prices for most grains and softs in 2014, they do not rule out the possibility that food price inflation could manifest during the final months of 2014, particularly in the event of the return of El Niño. Higher food price inflation could severely dampen household consumption, and would erode real growth in the economy.

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
Domestic Politics
15
Security Risks Will Remain High Due To Expanding Organised Crime
15
Chapter 1
17
Economic Activity
17
Export-Driven Growth To Continue In 2014 and 2015
17
Table: Macroeconomic Forecasts
17
Chapter 2
19
Domestic Politics
19
Next Government Likely To Shift To Expansionary Fiscal Policies
19
Chapter 2
21
Economic Activity
21
Recession To Remain As Consumption Continues To Weaken
21
Table: Macroeconomic Forecasts
21
Chapter 3
23
Domestic Politics
23
Security To Remain Central Risk, Despite Recent Reforms
23
Chapter 3
25
Economic Activity
25
2014/15 Budget To Support Fiscal Discipline
25
Table: Macroeconomic Forecasts
25
Chapter 4: Regional
Chapter 4: Regional
Regional Outlook I
27
Economic Citizenship Programmes No Silver Bullet
27
Table: Caribbean Economic Citizenship Programmes
27
Regional Outlook II
29
Expansionary Fiscal Policies Could Heighten Credit Risk In ECCU
29
Chapter 5: Country Summaries
31
Cuba
31
Business Environment
31
Notwithstanding Additional Reforms, Business Climate Remains Poor
31
Table: Macroeconomic Forecasts
31
Bermuda
33
Economic Activity
33
Tourism Uptick To Support GDP Growth In 2014
33
Table: Macroeconomic Forecasts
33
Bahamas
35
Business Environment
35
Rising Murder Rate Poses Risk To Tourism Sector
35
table: Macroeconomic Forecasts
35
Chapter 6: BMI Global Assumptions
37
Global Outlook
37
Growth Increasingly Polarised
37
Table: Global Assumptions
37
Table: Deve loped States , Real GDP Growt H, %
38
Table: BMI VERSUS BLOO MBERG CONSENSUS REAL GDP GROWTH FORECASTS, %
38
Table: Emerging Markets , Real GDP Growth , %
39

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