By the Caribbean Journal staff
The short-term outlook for Trinidad’s economy should be one of “cautious optimism,” according to Trinidad Central Bank Governor Jwala Rambarran.
The governor was speaking at a recent “Economic Outlook 2013” luncheon held by the Trinidad and Tobago Chamber of Industry and Commerce.
“Based on underlying assumptions and the turnaround in the third quarter, the Central Bank is maintaining its projection for real GDP growth of around 1 percent for all of 2012, and growth is expected to strengthen to 2.5 percent in 2013,” he said.
Rambarran’s projections are higher than those of the International Monetary Fund, which recently projected growth in Trinidad at 0.7 percent for 2012, and 2.2 percent for 2013.
Projections by the UN Economic Commission for Latin America and the Caribbean had the numbers at 1 percent and 2.2 percent, respectively.
And while he said that recent hydrocarbon discoveries in the country would positively affect Trinidad, he cautioned against the “increasing euphoria that has accompanied these discoveries.”
“The government must resist the easy seduction of another energy boom,” he said. “Instead, it must treat any of the associated windfalls from these hyrdocarbon discoveries as temporary, placing the windfalls as additional savings in the HSF, rather than imprudently consuming them. And it must move on with the diversification thrust that it has already kickstarted if it wants to secure lasting prosperity for all.”
The impending US fiscal cliff also presents a potential downside risk for Trinidad’s economy, he said, with the US being one of its major trading partners.