IMF Staff Country Reports

This 2023 Article IV Consultation discusses that St. Kitts and Nevis’ economic growth rebounded strongly in 2022 despite global headwinds. GDP is estimated to have grown by 9 percent in 2022 after contracting 14.5 percent in 2020 and 0.9 percent in 2021. Return to the pre-pandemic activity level is expected by end-2024, and beyond that, growth should converge toward its medium-term path. The budget is expected to be broadly balanced through 2025 and then go into deficits—predicated on current policies. Risks to the outlook are tilted to the downside in the short term, but with some upside potential in the medium term. The new government appointed following the 2022 general election is faced with important challenges. Preserving the country’s legacy of fiscal prudence, in a context of concerns over CBI resources’ sustainability, and of a pressing need to invest in resilience to natural disasters, will require difficult choices. An adequate prioritizing and sequencing of policies will be essential, and addressing concerns related to the systemic bank should be a priority.