News Americas, New York, NY, October 9, 2024: The World Bank has urged Caribbean nations to capitalize on key opportunities and implement structural reforms to drive sustainable economic growth. In its latest report, “Taxing Wealth for Equity and Growth,” released on Oct. 9th, the World Bank emphasized that the region must focus on fiscal reforms, increase investments, and harness the potential of nearshoring to break out of its low-growth cycle.
William Maloney, the World Bank’s Chief Economist for Latin America and the Caribbean, stressed that the Caribbean must improve its fiscal space, reduce tax burdens on productive sectors, and attract investments by enhancing government efficacy. He also emphasized the importance of wealth taxes as a tool to create fiscal space and promote equity.
“The region has made strides in managing inflation and stabilizing its macroeconomic environment, but more is needed to boost growth. This is a critical moment to attract investments, foster innovation, and create more and better jobs,” said Carlos Felipe Jaramillo, World Bank Vice President for Latin America and the Caribbean.
Economic Growth for Selected Caribbean Nations – 2024-2026
| Country | 2024 Growth (%) | 2025 Growth (%) | 2026 Growth (%) |
|---|---|---|---|
| Barbados | 3.9% | 2.8% | 2.3% |
| Belize | 4.3% | 1.2% | 0.5% |
| Dominica | 4.6% | 4.2% | 3.2% |
| Grenada | 3.2% | 4.7% | 4.4% |
| Guyana | 43% | 12.3% | 15.7% (2028) |
| Haiti | -4.2% | 0.5% | 1.5% |
| Jamaica | 0.8% | 2.2% | 1.6% |
| St. Lucia | 3.4% | 2.6% | 2.3% |
| St. Vincent and Grenadines | 5% | 3.5% | 2.9% |
| Suriname | 2.9% | 3% | 3.1% |
| Trinidad and Tobago | 2.2% | 2.3% | 0.9% |
Key Recommendations from the World Bank Report
- Wealth Taxes and Fiscal Space: The World Bank suggests that Caribbean nations should reconsider how tax systems can generate revenue while stimulating growth. Wealth taxes could be used to address income inequality and create fiscal space for investments.
- Nearshoring Opportunities: Despite having competitive wages, the region has not fully capitalized on nearshoring opportunities due to high capital costs, weak education systems, and inadequate infrastructure.
- Foreign Direct Investment: LAC has seen a decline in foreign direct investment levels, and the World Bank report notes that addressing infrastructure and social instability issues could help attract more investment.
With U.S. interest rates expected to decrease, the World Bank sees an opportunity for Caribbean economies to seize momentum and accelerate their development. However, this will require a concerted effort in governance and public investment reforms across the region.
