Caribbean & Central America - November 2009 (ISSN 1741-4458)

Alberto Guevara, the finance minister, forecasts that the economy will average real annual GDP growth of 2% between 2009 and 2013. He expects inflation to average between 4% and 5%. The government is trying to gloss over the unwelcome fact that the economy will contract by 1% in 2009, thanks to weaker exports, investment and remittances. In the 2010 budget, the government is hoping for 1% GDP growth. This will be followed by 2.5% growth in 2011 and 3.5% in 2012 and 4% in 2013. The government is forecasting that inflation this year will be around 2.6% and 3% in 2010.  In 2008 the economy grew by 3.2%, but inflation was 13.8%.

Trade: In the first 10 months of 2009 export receipts fell 9.2% year-on-year according to figures from the Centro de Trámites de las Exportaciones (Cetrex). Exports were valued at US$1.24bn in the first 10 months, down from US$1.36bn in the same period of 2008.  In calendar 2008, exports rose 24% on 2007 to reach US$1.54bn.

Budget: The budget for 2010 was set at C$25.2bn (US$1.2bn), though spending will be C$31bn (US$1.5bn). The proposed deficit of US$282m will be covered by aid and loans. The budget has to be approved by congress by 15 December. The rightwing opposition say that the proposal is far too optimistic.