Central Bank of Barbados reviews 2024 economy with 4% GDP growth and record $3.2 billion international reserves

The Central Bank of Barbados published its review of economic performance in 2024, reporting a third consecutive year of expansion with real GDP up 4%. Growth was led by business services, tourism, construction and retail trade, while inflation continued to ease and labour market conditions improved as unemployment and jobless claims declined. Gross international reserves rose to a record $3.2 billion, equivalent to 31.2 weeks of import cover, supported by net foreign exchange inflows from higher tourism receipts and tax revenues from the global business sector. Over the first three quarters of FY2024/25, the overall fiscal balance shifted to a surplus of $224.8 million (1.5% of GDP) from a $7.7 million deficit (0.1% of GDP) in the prior period, and the primary surplus increased by $278.8 million to $774.1 million (5.3% of GDP), contributing to a fall in the debt-to-GDP ratio to 103% from 109.8% at end-2023. Financial sector conditions were described as stable, with declining non-performing loans, strong capital buffers and ample liquidity across deposit-taking institutions. For 2025, real GDP growth is projected at 3% and inflation is expected to stabilise around 2%, while the government’s fiscal strategy targets a debt-to-GDP ratio below 100% by 2026. The review flagged external risks including a global slowdown, climate-related events and geopolitical tensions that could affect trade, tourism and commodity prices.