Colm Im­bert, Min­is­ter of Fi­nance, has wel­comed the In­ter­na­tion­al Mon­e­tary Fund’s (IMF) an­nu­al re­port on Trinidad and To­ba­go, pub­lished on June 05 2024, which pro­vides an in­de­pen­dent as­sess­ment of our econ­o­my.

In a state­ment the Min­istry of Fi­nance said, the IMF un­der­lines that “Trinidad and To­ba­go is un­der­go­ing a grad­ual and sus­tained eco­nom­ic re­cov­ery.”

It said the un­em­ploy­ment rate de­creased to 3.2 per­cent in 2023 af­ter peak­ing at 7.2 per­cent in 2020. It added that eco­nom­ic growth is broad based, led by the non-en­er­gy and en­er­gy sec­tors, while in­fla­tion is low.

The min­istry said the IMF hailed the sharp de­cline in in­fla­tion, from 8.7 per­cent in De­cem­ber 2022 to 0.3 per­cent in Jan­u­ary 2024, which is among the low­est in the world and con­tributes to shield­ing the pur­chas­ing pow­er of the pop­u­la­tion. “ The IMF al­so high­light­ed the favourable do­mes­tic fi­nanc­ing con­di­tions sup­port­ed by the Cen­tral Bank’s re­duc­tion of the re­po rate by 150 ba­sis points in March 2020 and its main­te­nance of that rate at 3.5 per­cent, since then, there­by help­ing to keep lend­ing rates low and sup­port the eco­nom­ic re­cov­ery.” Banks’ cred­it to the pri­vate sec­tor con­tin­ues to ex­pand at an ap­pro­pri­ate pace, dri­ven by busi­ness, con­sumer, and mort­gage lend­ing.

Ac­cord­ing to the Fund, “the fi­nan­cial sec­tor ap­pears sound and sta­ble”, with bank’s cap­i­tal well above the reg­u­la­to­ry min­i­mum, stand­ing at 16.7 per­cent in Sep­tem­ber 2023.

The in­sur­ance sec­tor al­so re­mains well cap­i­tal­ized.

The re­lease stat­ed that the cur­rent ac­count is es­ti­mat­ed to re­main in sur­plus in 2023, and in­ter­na­tion­al re­serve cov­er­age is ad­e­quate.

It said the fis­cal deficit in FY2023 con­tin­ued to sup­port the re­cov­ery and was bet­ter than bud­get­ed, while pub­lic sec­tor debt re­mained be­low the au­thor­i­ties’ soft debt tar­get. ”

“ The in­ter­na­tion­al fi­nan­cial mar­ket’s ap­praisal of Trinidad and To­ba­go’s cred­it re­mains strong.” Ac­cord­ing to the IMF, “Mar­ket ac­cess con­di­tions are bet­ter than the coun­try’s peers.

It ex­plained that last Sep­tem­ber, the gov­ern­ment placed a US$560 mil­lion long-term in­ter­na­tion­al bond at about 170 bps over the cor­re­spond­ing U.S. Trea­sury Bill. More­over, sov­er­eign spreads over U.S. Trea­suries have re­mained be­low its emerg­ing mar­ket peers, av­er­ag­ing 113 bps in 2023.”

Look­ing ahead, the IMF fore­casts that “eco­nom­ic growth is pro­ject­ed to gain mo­men­tum in 2024.”

The IMF fur­ther stat­ed that Trinidad and To­ba­go’s “ex­ter­nal pub­lic buffers in the Her­itage and Sta­bi­liza­tion Fund are large at about 20 per­cent of GDP. ”

Min­is­ter Im­bert in­di­cat­ed that “this IMF re­port rec­og­nizes that the Gov­ern­ment’s re­form pro­gramme in­tro­duced at the be­gin­ning of its pe­ri­od in of­fice has put the econ­o­my on the right track.”

The Min­is­ter of Fi­nance shared the IMF’s analy­sis re­gard­ing the im­por­tance of fos­ter­ing pri­vate sec­tor par­tic­i­pa­tion and pur­su­ing the re­form agen­da.

Min­is­ter Im­bert stat­ed, “I was pleased to see that the IMF agrees with the need to “sus­tain struc­tur­al re­form mo­men­tum” to sup­port growth be­cause that is ex­act­ly what we are de­liv­er­ing. Dur­ing the 2024 Bud­get, I an­nounced mea­sures that shift­ed spend­ing from mit­i­gat­ing the im­me­di­ate cri­sis of the Pan­dem­ic to in­vest­ment for medi­um and long term growth.”

He said the Gov­ern­ment will con­tin­ue on its path of re­spon­si­ble ac­tions to build a stronger Trinidad and To­ba­go.