Lower Fuel Prices To Help, First Citizens Seminar Told
THE First Citizens Market Outlook Seminar for this year held on February 4 offered several insights into the global, regional and local economy for 2015.
Presented annually by First Citizens Investment Services, the session featured an analysis and review of the previous year as well as economic and investment projections.
Starting off the morning’s presentations to over 50 persons at the St. Lucian by Rex Resorts, was First Citizens General Manager (Ag.) Sana Ragbir, who explained the status of the global economy. Ragbir noted that “global growth is expected to be supported by lower oil prices and weaker economic activity is expected in large players, namely: China, Russia, Brazil, Europe, and Japan as well as major commodity exporting countries. The US remains one of the only bright spots in the global recovery.”
First Citizens head of Research and Analytics, VangieBhagoo-Ramrattan, focused on the regional and local outlook touching on issues such as Foreign Direct Investment in the Caribbean and Credit ratings as well as debt obligations.
She noted that Barbados, St. Lucia and Grenada currently have the least fiscal flexibility. Quoting figures from the Economic Commission for Latin America and the Caribbean (ECLAC) she said that “Barbados’ debt is at around 97.7% of GDP (fiscal deficit at 7.1% of GDP). St. Lucia is at 80% of GDP with a deficit of 7.7% of GDP.”
Despite the figures from 2014, Bhagoo-Ramrattan’s presentation was full of optimism for 2015 advising that the improved external economy, particularly the US, will drive export growth. She noted also that the partial recovery of the world economy could create some space for boosting regional export volumes, exports of services (particularly tourism) and remittances receipts and that tourism should get a boost from lower oil prices.
With general elections in St. Lucia constitutionally due by 2016 the Research Head stated that this gave the current administration “flexibility to see tighter fiscal policies through; notwithstanding opposition pressures.”
“We expect that St Lucia’s economic growth will improve going forward based on uptick in activity in tourist arrivals from the US and Europe,” she noted. “Lower fuel prices, and higher disposable income, will support the region’s tourism industry and will bolster household consumption and provide a tailwind for the economy. Lower oil prices will also be beneficial to the external accounts.”
The room of business professionals also received insight on the investment climate and current economic conditions from featured speaker McHale Andrew, the CEO of Invest Saint Lucia. He offered a list of current and potential investment projects in various categories including manufacturing, tourism and soft-infrastructure.
Andrew described the overall outlook as “encouraging.” He however said that Saint Lucia “requires more purposeful developmental focus.”
He forecast that “Tourism will continue to lead the way in short term” but said that the development of Infrastructure (soft and hard) is crucial and also called for a “whole government approach” in order to achieve objectives.
The final presentation for the day was by First Citizens Investment Services Senior Business Development Officer Shaka St. Ange who delivered a review and outlook for the Eastern Caribbean Securities Exchange (ECSE). He also provided a list of upcoming Government Bonds and Treasury Bills.