Linda Hutchinson-Jafar, Business Writer

Caribbean economies such as Jamaica, Barbados and Guyana are expected to post weaker growth over the next two years due to a global slowdown and the effects of higher oil and food prices while the prospect for Trinidad and Tobago is for fairly robust growth, Caribbean researchers predict.

Dr Terrence Farrell, a former central banker, in a paper co-authored with research assistant Anna Lee Ali has sliced growth forecasts for Jamaica, even beyond the baseline rate estimated by the International Monetary Fund (IMF).

Farrell, the CEO-designate of One Caribbean Media Limited and former deputy governor of the Central Bank of Trinidad and Tobago, predicts that Jamaica's output will increase, but by less than 1.5 per cent, a far more conservative estimate than the IMF's World Economic Outlook which forecasts growth of 2.4 per cent.

Jamaica's own estimate is 3.0 per cent, though the Bank of Jamaica says a US recession could slice 0.4 per cent off the mark.

The country recorded GDP growth of 1.2 per cent in 2007.

JAMAICA POSITIVE BUT WEAK

The Farrell-Ali paper, titled 'Prospects for the global and regional economies' also pointed out that Jamaica has experienced positive but weak growth over the period 2000-2007, and that while unemployment has declined, it remains high at about 10.4 per cent.

Inflation which had accelerated between 2004 and 2005 due to hurricanes and higher oil prices fell significantly to 5.7 per cent in calendar 2006 but surged again to 16.8 per cent by the end of 2007.

Fiscal inflation for the year ending March 2008 rose to 19.9 per cent; while the benchmark six- month T-bill rate stood at 13.28 per cent - it has since climbed higher to 14.2 per cent - adding two points after the central bank twice raised signal rates on its open market instruments in January and February to stabilise the foreign exchange market.