Economic growth achieved; prices to rise generally

While stating that the British Virgin Islands experienced an estimated 3.2 percent growth rate in Gross Domestic Product (GDP) last year, Premier and Minister of Finance Dr D Orlando Smith said he expects inflation to increase in the near future.

Inflation is the general increase in prices and fall in the purchasing value of money.

Though he predicts general price increases, Premier Smith does not expect anything out of the ordinary.

He explained: “Coupled with the positive [economic] growth, there has been a decrease in inflation from 1.94 percent in 2014 to 0.85 percent in 2015, largely attributable to negative movement in the transportation index due to declining oil prices.”

“Although we expect that our inflation which mirrors that of the United States – our key import market – will begin to rise again, it should remain in its usual range of 1 percent to 2 percent in the medium term,” added Premier Smith.

Growth

The premier, in the meantime, elaborated on the pattern of growth in the territory’s Gross Domestic Product (GDP) – the monetary value of all finished goods and services produced in the territory within a particular period of time.

He gave an estimated growth rate for last year, but did not explain how he arrived at that percentage.

Instead, the premier shared statistics from the year 2015.

“Our Central Statistics Office has estimated that the British Virgin Islands has experienced a positive growth trajectory over the last several years, with a projected growth rate in GDP of approximately 3.2 percent in 2016, demonstrating – once again – that the BVI economy maintains a steady upward march.”

“This growth over the past two years or so has been largely due to growth in construction and transport driven mainly by public sector investment including the Tortola Pier Park project,” the premier said.

He continued: “Employment and average earnings have also risen steadily since 2012 to 2015 with a 4.4 percent increase in employment and a 6.3 percent increase in earnings, respectively. Although not yet completed, early months of 2016 show similar increases in employment figures. This means that we are consistently adding new jobs to the economy.”