Jan 2012 Financial News

Balance of payments improve (Barbados)

Jan 18, 2012

Barbados has recorded an improved balance of payments position in 2011.

The overall deficit on the balance of payments was estimated at $15 million, significantly lower that the $53 million registered in 2010, according to the Central Bank of Barbados (CBB) economic review for 2011.

The improvement stemmed from higher capital inflows last year when compared to 2010, said the Bank. “Net capital inflows were in excess of $700 million, which represents a near $200 million increase over the capital account balance for 2010,” the Bank reported.

Said the Bank, “This improvement was attributed mainly to higher net private inflows, in particular for real estate transactions ($252 million) and the sale of Barbados Light and Power (B&P) shares to Emera Inc. ($188 million). While $240 million in equity was raised by Sagicor, only $23 million was invested locally. Receipts from the energy-based policy loan from the Inter American Development Bank (IDB) ($140 million), were less than market borrowings of US$ 200 million in 2010, leading to a decline in public capital inflows.”

The report also highlighted that the current account deficit was 8 per cent of GDP, from 6.1 per cent in 2010, mainly due to the impact of higher international oil and commodity prices. Even though the volume of imported fuel products decreased by five per cent, the fuel import bill rose by $90 million, on account of the construction of a new brewery.

“In addition, increases were recorded for food and beverages ($50 million), fats and crude materials ($15million) and iron and steel ($11 million ),” the Bank said.

It noted that tourism continued to be the main foreign exchange earner, accounting for 38 per cent of earnings. However, tourism expenditure up to the third quarter fell by eight per cent compared to a one per cent increase for 2010.

Foreign inflows from other services, inclusive of international business, accounted for 23 per cent of inflows, while chemicals, rum and sugar exports contributed 2.8 per cent, 1.3 per cent and 0.4 per cent respectively. (NB)


Source:
Barbados Advocate
Wednesday January 18, 2012

http://www.barbadosadvocate.com/newsitem.asp?more=business&NewsID=22200