Strong Export Growth & H2 2021 Consumption Rebound To Power Trinidad & Tobago Recovery

• Real GDP in Trinidad & Tobago (T&T) is expected to grow by 4.4% in 2021, from an estimated 8.0% contraction in 2020, as energy exports strengthen. T&T experienced its largest recession since 1983 in 2020, as the COVID-19 pandemic significantly undermined demand for its energy exports and local public health restrictions limited mobility and commercial activity in the non-energy sector. 
• Global economic growth is projected to reach 5.7% in 2021 as the impact of the pandemic in developed markets (DM) fades, which should, boost energy demand. As a result of the global economic recovery, Fitch Solutions’ Oil and Gas team forecasts upstream production, including crude, natural gas plant liquids (NGPL) and other liquids, will grow by 3.1% in 2021. 
• However, the downside risk posed by T&T’s slow vaccination programme to the non-energy sector is significant. The twin island republic is currently facing a nationwide lockdown which began in  May and could undermine the recovery because of its effects on the non-energy sector. Already, the 2021 real GDP forecast has been revised down to 4.4%, from 5.3% previously. It is anticipated that the country will grow by 2.0% in 2022. 
• Structurally lower natural gas prices and concerns about the business environment will limit investment in the coming years, constraining long-term growth.

(Source: Fitch Solutions)