Grenada's centre-left opposition National Democratic Congresswill likely retake power from the centre-right New National Party inthe 2018 elections, as support for the ruling NNP has declined onthe back of fiscal austerity. An NDC government will likely pursuelooser fiscal policy over the coming years, we believe that the risksof a renewed debt crisis are relatively low.
Over the next two years, the Grenadian economy will grow at a rateabove its historical average. This is thanks to a bright outlook for thetourism sector and slightly looser fiscal policy.
Tourism will continue to recover over the next decade, with growthin the US economy and parts of Europe picking up. Declining unemploymentand greater wage growth in the US, a major source oftourists to Grenada, will contribute to robust tourism flows to Caribbeandestinations in the coming years.