Oil And Gas Sector Growth In Trinidad And Tobago To Drive GDP Growth In 2022

• Fitch Solutions has revised down its 2021 GDP forecast for Trinidad and Tobago (T&T) to -0.3%, from 3.4%, and revised up its 2022 forecast to 2.9%, from 2.5%, in 2022. 
• Rising demand for energy exports in Asia Pacific and growing domestic oil and gas production will drive exports in the oil and gas sector in the coming quarters, underpinning Fitch’s growth outlook. 
• Consumption will rise in the latter half of 2022, but low vaccination rates will likely limit the rate of growth. T&T suffered from the Covid-19 pandemic far more in 2021 than in 2020, with 2,611 Covid-19-related deaths in 2021 compared to 127 the year before. Fitch expects domestic consumption to decline Q122 as recent reports of slow retail sales echo sharp downturns in sales in Q220 and Q221 that followed prior waves of Covid-19 outbreaks. Apart from health restrictions that inhibit economic activity, the resulting decline in household income and purchasing power has weakened consumption. 
• That being said, T&T’s low vaccination rates and the transmissibility of the Omicron variant pose risks to the economic recovery in 2022. As of January 3, 86.6% of patients in the T&T healthcare system are not vaccinated, signalling the continued susceptibility of T&T to Covid-19 outbreaks. Even if cases do decline in the coming weeks or months, T&T will likely remain vulnerable to the emergence of new variants of the virus.

(Source: Fitch Solutions)