Boston, MA -- (SBWIRE) -- 09/11/2014 -- Core Views:

- We maintain our forecast for real GDP growth in Trinidad & Tobago (T&T) to accelerate to 2.6% in 2014 and 3.0% in 2015, up from 1.6% growth in 2013. We expect recent tax reforms will incentivise greater investment into the twin islands' key energy sector, while low interest rates will continue to spur growth in consumer lending, bolstering private consumption.
- Elevated public spending in advance of national elections in May 2015 will drive a widening of T&T's budget deficit in 2014. Beginning in H215, stronger revenues on the back of accelerating real GDP growth will lead the shortfall to begin to narrow.
- T&T's current account balance will remain in surplus in the coming years, driven by improving export performance in the energy sector. Recent tax reform will also continue to encourage an uptick in private foreign direct investment.

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Major Forecast Changes:

- We have revised our 2014 average exchange rate forecast to TTD6.373/USD, from TTD6.430/USD previously. The unit has strengthened in recent months, reversing its Q114 losses, likely bolstered by stronger goods exports as energy sector production has picked up. However, we believe that further appreciation will be limited, as energy prices will be tempered in the months ahead and the central bank will look to support export competitiveness.

Key Risks To Outlook

- Weaker hydrocarbons production and exports than we anticipate in the coming months could weigh on headline real GDP growth and see the current account shortfall increase less than we anticipate. Moreover, further weakness in energy exports could feed through to more substantial depreciation in the Trinidad & Tobago dollar than we anticipate this year.

The Trinidad & Tobago Business Forecast Report helps businesses with market assessment, strategic planning and decision making to promote growth and profitability in The Trinidad & Tobago and is an essential tool for CEOs, Chairmen, Finance Directors/CFOs, Managing Directors, Marketing/Sales Directors with commercial interests in this emerging market..

An influential new analysis of The Trinidad & Tobago's economic, political and financial prospects through end-2017, just published by award-winning forecasters, Business Monitor International (BMI).

Key Uses

- Forecast the pace and stability of The Trinidad & Tobago's economic and industry growth through end-2017.
- Identify and evaluate adverse political and economic trends, to facilitate risk mitigation.
- Assess the critical shortcomings of the business environment that pose hidden barriers and costs to corporate profitability.
- ContextualiseThe Trinidad & Tobago's country risks against regional peers using BMI's country comparative Risk Ratings system.
- Evaluate external threats to doing business in The Trinidad & Tobago, including currency volatility, the commodity price boom and protectionist policies.

The Trinidad & Tobago Business Forecast Report by Business Monitor International (BMI) includes three major sections: Economic Outlook, Political Outlook and Business Environment.

Economic Outlook:

How will the Trinidadian economic policy-making and performance impact on corporate profitability over 2013-2017?

BMI provides our fully independent 5-year forecasts for The Trinidad & Tobago through end-2017 for more than 50 economic and key industry indicators. We evaluate growth, and also forecast the impact of economic management.

Economic Outlook Contents

The Trinidad & Tobago Business Forecast Report features BMI's forecasts with supporting analysis for 2013 through to end-2017, set against government views and BMI's evaluation of global and regional prospects.

Key Areas Covered:

Data:

- Full 10-year forecasts with data - for key macroeconomic variables including GDP (real growth and per capita), population, inflation, current account balance and the exchange rate.
- BMI's comprehensive Risk Ratings system - rates each country worldwide for economic and political risk, and rates the business environment, within a global and regional context.

Written Analysis:

- Economic Activity - real GDP growth, employment, inflation, consumption (retail sales and confidence).
- Balance of Payments - trade and investment, current and capital account.
- Monetary Policy - interest rate trends (bank lending and deposit rates) and inflation (producer price and consumer price).
- Exchange Rate Policy - currency controls, foreign investment flows, exchange rates and foreign exchange reserves.
- Fiscal Policy - macroeconomic strategy and policies, government finance and tax reforms.

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