Trinidad and Tobago: 2010 Article IV Consultation-Staff Report, Supplement, Staff Statement, Public Information Notice on the Executive Board Discussion, and Statement by the Executive Director for Trinidad and Tobago (Electronic book text)

1. The economic slowdown as a result of the global crisis has been severe, and the recovery has not yet taken hold. High energy prices earlier in the decade led to several years of strong growth and high fiscal and external surpluses in this energy-dependent economy. At the same time, there were signs of overheating and looming financial vulnerabilities. With the fall in energy prices and the unfolding of the global crisis, real GDP fell by 31/2 percent in 2009, with the non-energy sector contracting by 71/4 percent. The large deterioration in terms of trade led to a fall in nominal GDP by 27 percent. Notwithstanding a partial recovery in energy prices, economic activity is moribund reflecting the uncertainty related to mid-term elections and delays in key policy decisions by the new government. Real GDP continued to contract in the first half of 2010 while the unemployment rate increased to 6.7 percent in 2010Q1 from 5.1 percent at end-2009