Caribbean Region Quarterly Bulletin: Volume 5, Issue 3: September 2016
Khadan, Jeetendra; Ruprah, Inder J.; Schmid, Juan Pedro; Wright, Allan; Gomez Osorio, Camillo; Waithe, Kimberly; Wenner, Mark D.; Clarke, Dillon; Thomas, Chrystol; Pradelli, Juan Jose; Okey, Onoh-Obasi
British voters surprised the world when they voted to leave the European Union in June 2016. Markets reacted heavily to the surprise, resulting in high volatility in all major stock indices as well as bond and foreign exchange markets. Many observers predicted a dire impact on the UK, EU and world economy. Anxiety also rose in the Caribbean. Around three months into the vote, markets have calmed down. Stock and bond indices are back to levels similar or higher than before the vote, although there are signs of an economic slowdown in the UK. In exploring the economic impact of the leave vote, we find that Brexit and the subsequent slow-down in economic growth will have only a marginal impact on the Caribbean's economic growth, tourism, remittances and exports, during 2016 and 2017. As usual, the Quarterly Bulletin also provides an overview of recent economic developments in the Caribbean.