{
  "title": "IMF Executive Board Concludes 2022 Article IV Consultation with St. Vincent and the Grenadines",
  "publication": "IMF News, November 17, 2022",
  "sourceUrl": "https://www.imf.org/en/news/articles/2022/11/17/pr22390-st-vincent-and-the-grenadines-imf-executive-board-concludes-2022-article-iv-consultation",
  "canonical": "https://www.imf.org/en/news/articles/2022/11/17/pr22390-st-vincent-and-the-grenadines-imf-executive-board-concludes-2022-article-iv-consultation",
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  "summary": "IMF Executive Board Concludes 2022 Article IV Consultation with St. Vincent and the Grenadines",
  "publishDate": "2022-11-17",
  "sections": [
    {
      "heading": "Recent economic performance and shock responses",
      "content": "- The Executive Board concluded the Article IV consultation on November 14, 2022.\n- St. Vincent and the Grenadines is recovering from the pandemic and 2021 volcanic eruptions.\n- Authorities’ policy responses were supported by two IMF Rapid Credit Facility (RCF) disbursements and financing from other International Financial Institutions.\n- Output decline in 2020 was the lowest in the ECCU and the economy is estimated to have grown by 0.8 percent in 2021, supported by strong post-volcanic eruption reconstruction activity.\n- Public debt increased to about 89 percent of GDP as of end-2021 due to critical responses to the shocks.\n- The financial system has weathered the shocks relatively well so far with adequate capital and liquidity buffers."
    },
    {
      "heading": "Outlook and risks",
      "content": "- The economy is projected to grow by 5 percent in 2022, supported by large-scale investment projects and recoveries in tourism and agriculture.\n- Growth is projected to strengthen further in 2023 as large-scale construction projects get into full swing.\n- External inflation pressures are expected to raise the annual inflation to 5.8 percent in 2022.\n- The outlook is subject to significant downside risks:\n  - Abrupt slowdown in trading partners’ growth.\n  - Potential delays in investment projects including due to supply chain disruptions.\n  - The ever-present threat of frequent natural disasters."
    },
    {
      "heading": "Fiscal policy stance and medium-term strategy",
      "content": "- Authorities seek to rebuild fiscal buffers over the medium term while balancing support for the vulnerable, building resilience, and maintaining fiscal prudence.\n- The primary deficit is estimated to widen as the port construction starts.\n- The primary balance excluding pandemic-, volcano-, and port-related spending is expected to improve from -0.4 percent of GDP in 2021 to 1.6 percent in 2022.\n- Authorities remain committed to reaching the regional debt ceiling and the medium-term fiscal strategy set out in the 2021 RCF.\n- Directors recommended fully operationalizing and recalibrating the Fiscal Responsibility Framework (FRF) to underpin commitment and signal a credible medium-term fiscal plan.\n- Directors called for complementary fiscal institutional reforms, building additional buffers, and preparing contingency plans to increase resilience to external shocks."
    },
    {
      "heading": "Structural reforms, labor policies, and social protection",
      "content": "- Near-term priorities: health and reconstruction spending and supporting the vulnerable, while maintaining fiscal prudence.\n- Directors encouraged keeping generalized fiscal relief temporary and enhancing coverage and targeting of the social safety net.\n- As the economy recovers, fiscal policy should shift from income support to active labor market policies (ALMP) to facilitate training and employment.\n- Directors emphasized continued broad-based structural reforms to support inclusive growth, promote employment, and bolster resilience to natural disasters.\n- Key infrastructure projects are instrumental for addressing supply-side constraints and improving structural resilience.\n- Directors welcomed efforts to improve the business climate, including the planned new Investment Act.\n- Investment into human capital: improve the scope, coverage, and effectiveness of technical and vocational education and training (TVET) programs, complemented by ALMP to facilitate employment.\n- Directors supported efforts to further develop the tourism sector."
    },
    {
      "heading": "Financial sector stability and supervision",
      "content": "- Directors noted the financial sector remains broadly stable.\n- They stressed the need to closely monitor asset quality following the end of the loan moratoria and bolster provisioning levels.\n- Financial authorities should continue to strengthen supervisory and regulatory frameworks and improve crisis preparedness.\n- Directors welcomed authorities’ strong efforts to strengthen the AML/CFT framework."
    },
    {
      "heading": "Selected social and economic indicators (exact values as reported)",
      "content": "- Area (sq. km): 389.3\n- Population (2022) — Total (thousands): 110.9\n- Density (per sq. km.): 284.9\n- Life expectancy at birth (years, 2016): 73.0\n- Infant mortality (per '000 live births, 2016): 15.2\n- Under 5 mortality rate (per '000, 2016): 17.0\n- Net enrollment rate, secondary (percent, 2018): 89.0\n- Labor market indicators (2017):\n  - Unemployment rate: 25.8\n  - Youth unemployment rate: 40.3\n  - Labor force participation rate: 67.8\n  - Rate of growth (percent per year): 0.1\n- Gross domestic product (2021):\n  - (millions of US dollars): 872\n  - (millions of EC dollars): 2,355\n  - (US$ per capita): 7,879\n\n- Output and Prices (Percent change) — Real GDP (market prices) by year:\n  - 2018: 3.2\n  - 2019: 0.7\n  - 2020: -3.7\n  - 2021: 0.8\n  - 2022 (Prel.): 5.0\n  - 2023 (Proj.): 6.0\n  - 2024 (Proj.): 4.8\n  - 2025 (Proj.): 3.5\n  - 2026 (Proj.): 2.7\n\n- Nominal GDP (market prices) — percent change:\n  - 2018: 3.0\n  - 2019: -4.6\n  - 2020: 0.4\n  - 2021: 8.5\n  - 2022 (Prel.): 10.6\n  - 2023 (Proj.): 6.9\n  - 2024 (Proj.): 5.6\n\n- Consumer prices, end of period:\n  - 2018: 1.4\n  - 2019: 0.5\n  - 2020: -1.0\n  - 2021: 3.4\n  - 2022 (Prel.): 8.0\n  - 2023 (Proj.): 2.1\n  - 2024 (Proj.): 2.0\n\n- Consumer prices, period average:\n  - 2018: 2.3\n  - 2019: 0.9\n  - 2020: -0.6\n  - 2021: 1.6\n  - 2022 (Prel.): 5.8\n  - 2023 (Proj.): 4.6\n\n- Banking System:\n  - Broad money, percent change:\n    - 2018: 1.7\n    - 2019: 9.9\n    - 2020: -4.5\n    - 2021: 12.8\n    - 2022 (Prel.): 1.2\n    - 2023 (Proj.): 5.7\n  - Credit to private sector:\n    - 2018: -0.5\n    - 2019: 1.1\n    - 2020: 3.3\n    - 2021: 0.0\n    - 2022 (Prel.): 4.2\n\n- Central Government Finances (Percent of GDP):\n  - Total revenue:\n    - 2018: 26.7\n    - 2019: 27.7\n    - 2020: 30.5\n    - 2021: 31.4\n    - 2022 (Prel.): 30.0\n    - 2023 (Proj.): 30.7\n    - 2024 (Proj.): 29.3\n    - 2025 (Proj.): 29.6\n    - 2026 (Proj.): 29.4\n  - Tax revenue:\n    - 2018: 23.1\n    - 2019: 22.6\n    - 2020: 23.7\n    - 2021: 25.0\n    - 2022 (Prel.): 24.6\n    - 2023 (Proj.): 24.8\n  - Grants:\n    - 2018: 3.7\n    - 2019: 2.2\n    - 2020: 2.4\n  - Total expenditure and net lending:\n    - 2018: 27.5\n    - 2019: 30.3\n    - 2020: 35.8\n    - 2021: 38.8\n    - 2022 (Prel.): 38.2\n    - 2023 (Proj.): 36.8\n    - 2024 (Proj.): 38.0\n    - 2025 (Proj.): 31.9\n    - 2026 (Proj.): 28.8\n    - 2027 (Proj.): 28.5\n  - Current expenditure:\n    - 2018: 24.0\n    - 2019: 24.4\n    - 2020: 27.4\n    - 2021: 29.5\n    - 2022 (Prel.): 27.3\n    - 2023 (Proj.): 26.2\n    - 2024 (Proj.): 25.5\n    - 2025 (Proj.): 24.2\n  - Of which: Wages and salaries:\n    - 2018: 12.1\n    - 2019: 12.4\n    - 2020: 13.8\n    - 2021: 14.3\n    - 2022 (Prel.): 13.6\n    - 2023 (Proj.): 12.3\n    - 2024 (Proj.): 12.0\n    - 2025 (Proj.): 11.8\n  - Interest:\n    - 2018: 2.6\n    - 2019: 2.5\n  - Capital expenditure:\n    - 2018: 5.9\n    - 2019: 9.3\n    - 2020: 10.9\n    - 2021: 12.6\n    - 2022 (Prel.): 7.1\n    - 2023 (Proj.): 4.4\n  - Overall balance:\n    - 2018: -0.8\n    - 2019: -2.7\n    - 2020: -5.3\n    - 2021: -7.3\n    - 2022 (Prel.): -8.2\n    - 2023 (Proj.): -6.1\n    - 2024 (Proj.): -8.7\n    - 2025 (Proj.): -2.4\n    - 2026 (Proj.): 0.6\n    - 2027 (Proj.): 1.0\n  - Overall balance (excl. grants):\n    - 2018: -2.5\n    - 2019: -5.7\n    - 2020: -8.0\n    - 2021: -8.9\n    - 2022 (Prel.): -10.9\n    - 2023 (Proj.): -9.8\n    - 2024 (Proj.): -4.8\n    - 2025 (Proj.): -1.6\n    - 2026 (Proj.): -1.2\n  - Primary balance:\n    - 2018: -0.4\n    - 2019: -3.1\n    - 2020: -3.4\n    - 2021: -6.0\n    - 2022 (Prel.): 0.3\n\n- External Sector (Percent of GDP unless indicated otherwise):\n  - External current account:\n    - 2018: -10.2\n    - 2019: -15.1\n    - 2020: -22.8\n    - 2021: -26.5\n    - 2022 (Prel.): -27.6\n    - 2023 (Proj.): -19.8\n    - 2024 (Proj.): -13.8\n    - 2025 (Proj.): -9.0\n  - Exports of goods and services:\n    - 2018: 36.4\n    - 2019: 36.0\n    - 2020: 21.7\n    - 2021: 15.9\n    - 2022 (Prel.): 22.5\n    - 2023 (Proj.): 36.7\n    - 2024 (Proj.): 38.7\n    - 2025 (Proj.): 39.2\n    - 2026 (Proj.): 39.7\n  - Imports of goods and services:\n    - 2018: 51.2\n    - 2019: 46.7\n    - 2020: 43.0\n    - 2021: 47.7\n    - 2022 (Prel.): 54.4\n    - 2023 (Proj.): 60.9\n    - 2024 (Proj.): 59.2\n    - 2025 (Proj.): 55.8\n    - 2026 (Proj.): 53.0\n    - 2027 (Proj.): 52.4\n  - Public sector external debt (end of period):\n    - 2018: 49.3\n    - 2019: 48.1\n    - 2020: 54.8\n    - 2021: 66.3\n    - 2022 (Prel.): 68.9\n    - 2023 (Proj.): 72.6\n    - 2024 (Proj.): 75.4\n    - 2025 (Proj.): 76.0\n    - 2026 (Proj.): 73.5\n    - 2027 (Proj.): 70.3\n  - External public debt service 1/:\n    - 2018: 14.0\n    - 2019: 23.8\n    - 2020: 23.4\n    - 2021: 18.2\n    - 2022 (Prel.): 14.4\n    - 2023 (Proj.): 15.1\n\n- Memorandum Items:\n  - Holdings of SDRs (in millions of EC$): 3.1\n  - Holdings of SDRs (in millions of EC$) [other line]: 44.5\n  - Gross public sector debt (in percent of GDP):\n    - 2018: 69.4\n    - 2019: 68.1\n    - 2020: 79.5\n    - 2021: 89.3\n    - 2022 (Prel.): 87.8\n    - 2023 (Proj.): 88.0\n    - 2024 (Proj.): 89.2\n    - 2025 (Proj.): 83.2\n    - 2026 (Proj.): 79.2\n  - Nominal GDP (market prices; in millions of EC$) 2/:\n    - 2018: 2,388\n    - 2019: 2,459\n    - 2020: 2,347\n    - 2021: 2,556\n    - 2022 (Prel.): 2,826\n    - 2023 (Proj.): 3,022\n    - 2024 (Proj.): 3,189\n    - 2025 (Proj.): 3,341\n    - 2026 (Proj.): 3,500\n\n- Note: The authorities rebased GDP to 2018 and improved methodology with support from CARTAC (2021). As a result, nominal GDP in 2018 increased by 9 percent.\n- Footnotes in original table:\n  - 1/ In percent of exports of goods and services.\n  - 2/ The authorities rebased GDP to 2018 and improved methodology with support from CARTAC (2021).\n\nIMF Communications Department — Press Release No. 22/390\n\n---\n\n\n References\n\n- https://www.imf.org/-/media/images/imf/bios/imfboard.jpg\n- The Executive Board\n- St. Vincent and the Grenadines and the IMF\n- IMF Policy Advice -- A Factsheet\n- Press Releases\n- PRESS CENTER\n- http://www.IMF.org/external/np/sec/misc/qualifiers.htm\n- https://www.imf.org/en/home\n\nSource: https://www.imf.org/en/news/articles/2022/11/17/pr22390-st-vincent-and-the-grenadines-imf-executive-board-concludes-2022-article-iv-consultation"
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    "Published: November 17, 2022",
    "The Executive Board concluded the Article IV consultation on November 14, 2022.",
    "St. Vincent and the Grenadines is recovering from the pandemic and 2021 volcanic eruptions.",
    "Authorities’ policy responses were supported by two IMF Rapid Credit Facility (RCF) disbursements and financing from other International Financial Institutions.",
    "Output decline in 2020 was the lowest in the ECCU and the economy is estimated to have grown by 0.8 percent in 2021, supported by strong post-volcanic eruption reconstruction activity.",
    "Public debt increased to about 89 percent of GDP as of end-2021 due to critical responses to the shocks.",
    "The financial system has weathered the shocks relatively well so far with adequate capital and liquidity buffers.",
    "The economy is projected to grow by 5 percent in 2022, supported by large-scale investment projects and recoveries in tourism and agriculture.",
    "Growth is projected to strengthen further in 2023 as large-scale construction projects get into full swing.",
    "External inflation pressures are expected to raise the annual inflation to 5.8 percent in 2022.",
    "The outlook is subject to significant downside risks:",
    "Authorities seek to rebuild fiscal buffers over the medium term while balancing support for the vulnerable, building resilience, and maintaining fiscal prudence.",
    "The primary deficit is estimated to widen as the port construction starts.",
    "The primary balance excluding pandemic-, volcano-, and port-related spending is expected to improve from -0.4 percent of GDP in 2021 to 1.6 percent in 2022.",
    "Authorities remain committed to reaching the regional debt ceiling and the medium-term fiscal strategy set out in the 2021 RCF.",
    "Directors recommended fully operationalizing and recalibrating the Fiscal Responsibility Framework (FRF) to underpin commitment and signal a credible medium-term fiscal plan.",
    "Directors called for complementary fiscal institutional reforms, building additional buffers, and preparing contingency plans to increase resilience to external shocks.",
    "Near-term priorities: health and reconstruction spending and supporting the vulnerable, while maintaining fiscal prudence.",
    "Directors encouraged keeping generalized fiscal relief temporary and enhancing coverage and targeting of the social safety net.",
    "As the economy recovers, fiscal policy should shift from income support to active labor market policies (ALMP) to facilitate training and employment.",
    "Directors emphasized continued broad-based structural reforms to support inclusive growth, promote employment, and bolster resilience to natural disasters.",
    "Key infrastructure projects are instrumental for addressing supply-side constraints and improving structural resilience.",
    "Directors welcomed efforts to improve the business climate, including the planned new Investment Act.",
    "Investment into human capital: improve the scope, coverage, and effectiveness of technical and vocational education and training (TVET) programs, complemented by ALMP to facilitate employment.",
    "Directors supported efforts to further develop the tourism sector.",
    "Directors noted the financial sector remains broadly stable.",
    "They stressed the need to closely monitor asset quality following the end of the loan moratoria and bolster provisioning levels.",
    "Financial authorities should continue to strengthen supervisory and regulatory frameworks and improve crisis preparedness.",
    "Directors welcomed authorities’ strong efforts to strengthen the AML/CFT framework.",
    "Area (sq. km): 389.3",
    "Population (2022) — Total (thousands): 110.9",
    "Density (per sq. km.): 284.9",
    "Life expectancy at birth (years, 2016): 73.0",
    "Infant mortality (per '000 live births, 2016): 15.2",
    "Under 5 mortality rate (per '000, 2016): 17.0",
    "Net enrollment rate, secondary (percent, 2018): 89.0",
    "Labor market indicators (2017):",
    "Gross domestic product (2021):",
    "Output and Prices (Percent change) — Real GDP (market prices) by year:",
    "Nominal GDP (market prices) — percent change:",
    "Consumer prices, end of period:",
    "Consumer prices, period average:",
    "Banking System:",
    "Central Government Finances (Percent of GDP):",
    "External Sector (Percent of GDP unless indicated otherwise):",
    "Memorandum Items:",
    "Note: The authorities rebased GDP to 2018 and improved methodology with support from CARTAC (2021). As a result, nominal GDP in 2018 increased by 9 percent.",
    "Footnotes in original table:",
    "[https://www.imf.org/-/media/images/imf/bios/imfboard.jpg](https://www.imf.org/-/media/images/imf/bios/imfboard.jpg)",
    "[The Executive Board](https://www.imf.org/external/np/sec/memdir/eds.aspx)",
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    "[IMF Policy Advice -- A Factsheet](https://www.imf.org/en/about/factsheets/imf-surveillance)",
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