Caribbean Economics Quarterly: Volume 13, Issue 1: Risks and Opportunities for Caribbean Economies in a Diverging World

Caribbean economies are experiencing continued growth into 2024 as the severe economic and social stress of the COVID-19 pandemic has receded. Meanwhile, global economic conditions may be diverging. For Caribbean economies, these divergent circumstances and policies could create both risks and opportunities moving forward. The much-anticipated lowering of global interest rates has not yet materialized. The U.S. economy is performing more strongly than expected, with inflation stuck above the 2 percent target. This is leading to the possibility that the U.S. Federal Reserve will further delay reducing the policy interest rate. After the strong economic recovery of 20212023, Caribbean economies continue to grow at a somewhat faster pace than Latin America and the Caribbean as a whole. Further work to strengthen macro frameworks is a fundamental precondition for growth. A renewed focus on regulatory reforms, human capital, and resilient infrastructure could make Caribbean economies “ready for take-off” to higher levels of growth. Country circumstances vary substantially, as noted in the country sections of this report.