Caribbean Economies Show Resilience Amid Global Volatility, But Risks Persist, Says New IDB Group Report

WASHINGTON - Caribbean economies have demonstrated notable resilience in the face of global economic headwinds, according to a new report from the Inter-American Development Bank Group (IDB Group). Strong performance in tourism and energy has anchored regional growth, although significant downside risks persist.

The latest edition of the Caribbean Economics Quarterly, "How Are External Forces Impacting Trade, Growth, and Investment in the Caribbean?" offers a comprehensive analysis of the region's economic outlook. The study examines global trends and their implications on the economies of The Bahamas, Barbados, Guyana, Jamaica, Suriname, and Trinidad and Tobago.

The Caribbean remains vulnerable to external shocks, the report highlights. Potential weakening of labor markets in North America, cautious investor sentiment, and evolving global supply-chain patterns are among the key risks that could dampen growth prospects.

"The Caribbean has navigated a complex global landscape with commendable stability, but we must remain vigilant," said Anton Edmunds, IDB general manager for the Caribbean. "This report provides a clear-eyed view of the challenges ahead, while also highlighting significant opportunities for growth. Investments in tourism, reliable energy, and technology-focused foreign investment can build greater resilience and secure a more prosperous future for the region."

The report notes that the downward trend in global commodity prices has eased current account pressures for oil-importing countries, while Guyana's expanding oil sector continues to drive robust growth, with promising prospects for Suriname's oil sector in the coming years. Tourism-dependent economies such as The Bahamas and Barbados demonstrated strong performance in the first half of 2025, supported by buoyant travel demand.

The recent impact of Hurricane Melissa on Jamaica underscores the severe disruptions that natural disasters can inflict on critical sectors, including agriculture, mining, and tourism, with broader implications for the entire region's economy.

Despite the challenges, the report identifies significant opportunities for the Caribbean. Diversification within tourism and services, renewed interest in energy resilience, and technology-focused foreign direct investment, which is expanding globally. The Caribbean's increasing geographic diversification in trade also offers some insulation from global tensions.

The Caribbean Economics Quarterly publication series is a trusted resource for policymakers, academia, and businesses. Previous editions are available here.