The Gap Between January and April: IMF WEO growth downgrades

Update · 20 July 2026

The Caribbean Development Bank has since revised this projection. At its 56th Annual Meeting in Nassau, 1 to 5 June 2026, the Bank put 2026 regional growth excluding Guyana at 1.1 per cent, down from the 2.5 per cent cited here. The figure above is what the Bank published at the time of writing and is left as printed. Briefs 008 and 011 carry the revised number.

Update · 21 July 2026

The 4.4 per cent primary surplus cited here is the BERT 2026 target, correctly stated as tabled on 17 March. The realised path has since come in below it. When the IMF Executive Board approved the precautionary Stand-By Arrangement on 22 June 2026 (Press Release 26/219), it recorded a primary surplus of 4.2 per cent of GDP for FY2025/26 and projected 3.5 per cent for FY2026/27, against a BERT commitment of 4.4 per cent held through FY2027/28. The target above is left as printed.

Update · 8 August 2026

A correction to the central figure. This Brief attributes a 2026 Barbados growth projection of 2.1 per cent to the World Economic Outlook published on 17 April 2026. The April 2026 WEO projects 2.5 per cent. The 2.1 per cent was the Fund's standing projection before that release, which is how the Nation News report cited here presented it on 16 April, the day before publication. The 2.7 per cent figure for 2025 is correct. This matters to the argument rather than sitting beside it: at 2.5 per cent the new WEO projection sat at the floor of the 2.5 to 3.0 per cent range Governor Greenidge had given in January, so the gap between the two forecasts was narrower than this Brief describes, and for the lower bound there was no gap at all. The June 2026 Article IV staff projection has since revised 2026 growth to 2.2 per cent, which is the figure the Caribbean Debt Tracker carries. The prose above is left as published.

On 16 April 2026, ahead of the IMF and World Bank Spring Meetings, Managing Director Kristalina Georgieva told reporters that "even our most hopeful scenario involves a growth downgrade." The next day, the Fund's World Economic Outlook confirmed the shape. For Barbados, the new projection is 2.1 per cent growth in 2026, down from 2.7 per cent in 2025. In January, Governor Kevin Greenidge of the Central Bank had forecast 2.5 to 3.0 per cent for the same year.

The gap between those two forecasts is roughly half a percentage point. What separates them is the Middle East War's footprint, landing on Barbados's growth projection three months after the Governor's outlook. Georgieva, speaking from the Fund's Washington headquarters, named the mechanisms plainly: significant infrastructure damage, supply disruptions, losses of confidence. She also flagged a five-week gap in tanker traffic from the Gulf, the sort of shipping-lane statistic that ends up inside diesel invoices, freight insurance, and the price of a tin of corned beef on a supermarket shelf. For an economy that imports virtually all of its fuel, the transmission is not complicated. What January's outlook assumed as global conditions "broadly supportive" has been revised. The 3.3 per cent global growth projection from the IMF's January 2026 World Economic Outlook is now, by the Fund's own words, an upper bound on what 2026 can deliver, subject to whether the ceasefire holds and how long oil and gas prices stay elevated.

Barbados is doing the fiscal work. BERT 2026, tabled on 17 March, commits to a primary surplus of 4.4 per cent of GDP through FY2027/28, tapering to 3.5 per cent thereafter, with public debt falling towards 60 per cent of GDP by FY2035/36. Public sector debt has already dipped below 105 per cent of GDP. The IMF's June 2025 fifth review under the Extended Fund Facility endorsed the path. None of this changes because a growth forecast slides four-tenths of a point. It does mean the denominators underneath every ratio are smaller than January assumed. Caribbean service-exporting economies face the same calculation. The CDB's Caribbean Economic Review and Outlook 2025-2026 projects regional growth of 2.5 per cent in 2026 excluding Guyana, with tourism and construction doing most of the pulling. If imported energy prices stay higher for longer, the pulling gets harder. Remittances cushion some households. Fuel pass-through hits everyone. The fiscal anchor can hold, but the surface of the water is changing.

A cut of 0.4 percentage points does not announce itself at the fuel pump. It arrives the way gradual revisions always do, through small adjustments in shipping costs, in the price of imported inputs, in the rate at which visitors decide to book or not book. The forecast gap between January and April is the war, arriving in the outlook.

Sources

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The Gap Between January and April

The Bridgetown Brief.