Dominica expects 5% yearly growth from 2022-2026, IMF study finds

As per the projections of the International Monetary Fund (IMF), the Commonwealth of Dominica is expected to have a growth of 5 percent between 2022 to 2026. 

Dominican Prime Minister Dr Roosevelt Skerrit.

Roseau, Dominica: As per the projections of the International Monetary Fund (IMF), the Commonwealth of Dominica is expected to have a growth of 5 percent between 2022 to 2026. 

Prime Minister Dr Roosevelt Skerrit considers this as a promising growth outlook for the island, despite the impact of the deadliest COVID-19 pandemic on economic activity. 

GDP is projected to reach pre-pandemic levels by 2023, averaging 5% growth per year through 2022-2026. 

The study shows that the economy and tourism sector of Dominica was hardly hit by the pandemic, following which the GDP has been estimated to contract by around 11% in 2020 while recording a recovery rate of 3.7% in 2021. 

Lockdown resulted in the astute reduction of the tourism sector, but under the leadership and excellent management of the Dominican prime minister, the islands’ economy is reviving. 

The report states that CBI revenue is aiding in strengthening islands’ infrastructure, such as international airport, sports courts, roads improvement, a resilient water and sewage network, improvements in the hospital capacity and geothermal electricity plant. 

Revenue generated from CBI also contributes in achieving the aim of becoming the world’s first climate-resilient nation, as it assists the Dominican government to construct climate-resilient homes for the general public. Above mentioned projects would eventually help the country to get back on track. 

The tourism recovery would be supported by the ongoing construction of new hotels. The recently inaugurated direct flights from the United States will also contribute to generating revenue and boosting the tourism sector, which will eventually support the GDP to grow at a good pace. 

IMF, in its findings, has also praised and appreciated the economic policies of the PM Skerrit’s Cabinet. The organisation suggested the Dominican administration to boost its COVID-19 vaccination drive and build additional health care centres to defeat this deadliest virus so that the nation can soon return back to normalcy. 

The risks to outlook justify the allocation of a part of CBI revenue to the Vulnerability & Resiliency Fund (VRF) for self-insurance against natural disasters (at least 10% of GDP plus annual savings of about 1.5% of GDP to guarantee its long-term sustainability), and to reduce public debt with targeted net-repayments once output has recovered,” study of IMF adds. 

Following the above statement, the findings note that this would expand fiscal buffers, speed up post-disaster recovery with funding for reconstruction and rehabilitation, creating space to access external financing in the event of a large natural disaster or the ongoing prolonged pandemic.