Slow Recovery Ahead For Saint Lucia As Tourism Gradually Rebounds

• The Saint Lucian economy will slowly recover from the COVID-19 pandemic in 2021 as tourism and other service exports begin to gain steam. Against this background, Fitch Solutions has revised its real GDP growth forecasts to 4.4% in 2021 and 7.5% in 2022, from 4.1% and 4.4% previously. In 2020, the St. Lucian economy contracted by an estimated 23.8%. 
• In an effort to mitigate the economic damage from the pandemic, Prime Minister Allen Chastanet implemented a Social Stabilization programme, estimated at 3.0% of GDP, in April 2020 to bolster household incomes, extend wage subsidies and offer a short-term moratorium on corporate and income tax payments. 
• His administration supplemented the initial package with the July 2020 Economic Recovery and Resilience Plan, worth approximately 11.5% of GDP, to strengthen public assistance for businesses and households. 
• However, the market will not fully regain its pre-pandemic level of output until 2024, largely in line with the broader outlook for smaller Caribbean markets that rely on tourism.

(Source: Fitch Solutions)