ECONOMY GREW BY 4.9% IN 1998.

The Barbados economy grew by about 4.9% in 1998, but Central Bank Governor Winston Cox said the challenge will be to sustain this growth in 1999, "without inflation and without weakening the balance of payments," reports CANA (January 29, 1999): Agricultural output in 1998 declined by about 14.2%: sugar production fell by 25.9%, the result of declining yields and a fall in the number of hectares harvested as well as bad weather;

Certain macroeconomic fundamentals have introduced a note of caution from the Central Bank. For the first time since 1991, there has been a deficit on the balance of payments and the fiscal deficit was slightly higher than in 1997. Foreign reserves declined by Bds$14.1 million (US$7.05 million); Private sector building activity provided the impetus behind an estimated 16.9% rise in activity in the construction sector, and stimulated other service sectors. Inflation was measured at minus 1.2%, vs. a 7.6% rise in 1997. The tourism sector grew by 6.8%.