The VI

According to Premier Ralph T O’Neal the  VI’s economy is projected to grow between four and five percent in 2011 but this growth is based on growth projections in the United States, anticipated expansion of the tourism and financial services markets and subsequent increases in Government expenditure and household consumption.

Hon O’Neal made this disclosure in his 2011 Budget Address delivered on November 4, 2010, where he stated that the expectations for 2011 for the Virgin Islands economy are highly dependent on the extent and pace of recovery of European and Asian economy and more particularly the United States economy since the VI conducts the majority of trade activities in goods and services in that market.

As for inflation unless there are significant upward changes in the US inflation rate, he said, it is forecasted to continue along the same trend as that of 2010, between 2 and 3 percent.

Signs of recovery – A glance at 2010 projections

With 2009 described as one of the most challenging for the Territory’s economy, as the slow recovery process began following the global economic crisis, Premier O’Neal said he is pleased that 2010 has shown signs of recovery.

Economic growth for 2010 is forecast at an estimated six percent given expected growth in the tourism and financial services industry.  And increased economic activity in those two sectors is expected to filter into other industries such as construction, real estate and whole and retail resulted in their growth in 2010, the Premier stated in his budget address.

Based on provisional statistics for the first half of 2010, the Premier stated that tourism arrivals have increased by four percent and company incorporations by approximately 33 percent but that continued growth in the sector is heavily dependent on the performance of the industry during the last two months of the year (November and December) which represents the beginning of the 2011 peak tourism season.

In addition, the Premier further revealed that Government’s financial services sector continues to be robust with figures for the first three quarters of the year indicating that total revenue collection for 2010 should not be less than last year where approximately $167.7 million was collected.

Meanwhile, inflation rate for 2010 is expected to remain low between 2 and three percent.