BRIDGETOWN, Barbados – The Caribbean Development Bank (CDB) presented a sobering assessment of regional economic performance for 2025, revealing a significant growth deceleration attributed to mounting global uncertainties, climate disruptions, and fiscal pressures. The findings were delivered by Jason Cotton, the Bank’s Acting Deputy Director of Economics, during its Annual News Conference on March 3, 2026.
Economic expansion across the Caribbean region, excluding the rapidly growing nation of Guyana, dwindled to a mere 0.6% in 2025, a sharp decline from the 1.4% growth recorded in 2024. Guyana’s extraordinary double-digit growth trajectory, though moderating, elevated the collective regional growth figure to 4.7% when included in the calculation.
Mr. Cotton emphasized the heightened vulnerability of small, open economies to external shocks, stating, ‘What is more concerning in this moment is the persistence of uncertainty and the narrowing room for policy error.’
The economic landscape was markedly diverse across member nations. Suriname, a major commodity exporter, benefited from sustained investments in its oil sector. In contrast, Trinidad and Tobago registered only modest growth. Service-dependent economies, particularly those reliant on tourism, experienced a noticeable slowdown. Jamaica faced a second consecutive year of economic contraction, severely impacted by the compounded destruction of Hurricanes Melissa and Beryl.
A silver lining emerged in macroeconomic indicators, as inflation rates across the region plummeted to an average of 3.4%, aligning with global trends and representing a dramatic drop from the 9.7% peak in 2022. Labor markets also showed tentative improvement, with declining unemployment and rising participation, though significant disparities persisted for youth and women.
Fiscal health emerged as a critical concern. Consolidation efforts faltered across many of the CDB’s 19 Borrowing Member Countries. The primary fiscal surplus narrowed to 1.3% of GDP (excluding Guyana), as government expenditures outpaced revenues. This surplus contracted further to just 0.2% when Guyana’s substantial capital investments were factored in. While the aggregate central government debt-to-GDP ratio saw a slight improvement to 46.6%, significant vulnerabilities remain entrenched, with nine nations carrying debt burdens exceeding 60%.
Looking ahead to 2026, the CDB projects a period of cautious, modest growth. Regional GDP, excluding Guyana, is forecast to expand by approximately 1.1%. With Guyana’s economy anticipated to grow by over 20%, the overall regional growth is projected to reach 6.2%. This outlook remains fraught with risks, heavily contingent on volatile commodity prices, the pace of tourism recovery, and the persistent threats of global instability and climate-related shocks.
In response to these challenges, the CDB outlined a strategic framework for building resilience. Key priorities include enhancing project implementation capacity, promoting economic diversification to reduce reliance on single industries, proactively investing in climate-resilient infrastructure, strengthening fiscal institutions to ensure debt sustainability, and making targeted investments in human capital development.
Mr. Cotton concluded on a note of determined optimism, affirming, ‘Resilience is built through credible policy choices, stronger institutions, disciplined execution, and investment in our people, and regional solidarity. If we rise to meet this moment, we will shape a more stable, inclusive, and sustainable Caribbean future.’
