Moody’s Investors Service has predicted that the T&T economy will grow in the next two years but says economic diversification remains weak.
The report said that although growth is expected institutional shortcomings are present in the country and ineffective policy-making institutions are constraining the country’s credit rating.
Moody's said: "Although full-year data is not yet available, short-term indicators suggest that after almost a decade of stagnation, the economy returned to growth in 2018. We expect economic growth to be around 1.5%-2.5% in 2019-20.”
The report continued: "Even this relatively modest growth is supportive of Trinidad’s economic strength.”
However, Moody’s said that there are issues in moving the economy from dependence on the energy sector.
It said: "The country’s prospects for economic diversification away from hydrocarbons remain limited because of deep-seated institutional shortcomings and short-term policy decisions.”
Moody’s also said that "weak policymaking institutions are a key constraint on Trinidad's sovereign credit profile.”
It continued: "Significant data limitations and institutional constraints limit policy predictability and effectiveness, creating uncertainty over medium-term fiscal projections.”
The rating agency said that the growth and fiscal outlook of the country remain vulnerable given the high reliance on the energy sector.
- by Kyron Regis