CATEGORY:ECONOMIC NEWS
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By Trevor Thwaites (St.George's correspondent)

ST.GEORGE’S, Grenada: The economies of Grenada and OECS member states are showing encouraging signs of expansion. That’s the assessment of a team from the International Monetary Fund (IMF) currently on a mission throughout the Organization of Eastern Caribbean States (OECS). “Recent economic outcomes have been strong growth for the ECCU region accelerated in 2005 to about 4 ˝ percent, due largely to the recovery in tourism and increased construction activity ahead of the 2007 Cricket World Cup,” head of the IMF Team David Robinson told reporters on Friday July 14, in St George’s, as it wrapped up a two-day visit.

However, Robinson said that the IMF is concerned about the performance of the various economies, especially Grenada when the construction boom starts to subside. “In some countries this is linked to the private investment in the hotel sector ahead of the Cricket World Cup. In countries like Grenada there is a lot of private and public sector reconstruction activities,” the IMF official pointed out. He said the challenge facing the region will be how the country will move from construction led growth to a more sustainable growth that will continue to deliver high growth and higher living standards.

Robinson also spoke favourably about the fiscal performance of the sub-region. “We do see that fiscal balances have improved somewhat in the last couple of years. The region as a whole recorded a small surplus on its primary balance, which is the overall government balance including interest payments for the first time in nearly a decade.” However he said that there are still issues regarding how economic and fiscal development can sustained. “But clearly this is progress,” he said.

The IMF is visiting the Eastern Caribbean Currency Union during July and August to conduct the Fund’s 2006 regional discussions. It will also visit Antigua/Barbuda, Dominica, St Kitts/Nevis, St Lucia and St Vincent and the Grenadines and meet with key regional institutions including the Caribbean Development Bank (CDB) the Eastern Caribbean Central Bank (ECCB) and the Organization of Eastern Caribbean States (OECS).

Robinson said that discussion will be focused on the economic prospects, opportunities and challenges facing the sub-region. “We also want to look at emerging issues facing the region – the role of integration, the CSME versus the OECS Economic Union, how it will impact on the region. We also want to look at the emerging challenges example HIV/AID, what impact it could have, how significant a problem it is now and what can be done to help mitigate the challenges going forward.