FROC Reports Strong Fiscal Turnaround, Warns of Risks Ahead

The Fiscal Responsibility Oversight Committee (FROC) has delivered a generally positive report card on Antigua and Barbuda’s economy, highlighting strong growth and an impressive fiscal turnaround, while cautioning that risks remain on the horizon.

Deputy Chair of the FROC, Professor Justin Robinson of the University of the West Indies Five Islands Campus, told Cabinet that GDP expanded by about six percent — the strongest in the Caribbean outside of Guyana. Inflation has eased to around 5–6 percent, and the labor market now accounts for roughly 49,000 jobs.

Most striking, however, was the fiscal balance, which swung from a EC$91.9 million deficit in 2023 to a surplus of EC$86.4 million in 2024, representing an improvement of EC$178.3 million, or about EC$1,900 per capita. For the first time since 2016, Antigua and Barbuda also posted a primary surplus, reversing years of primary deficits. Public debt now stands at about 62.3 percent of GDP — within reach of the Eastern Caribbean Central Bank’s 60 percent benchmark.

Despite the gains, Robinson cautioned that some of the revenue improvements were boosted by one-off items, such as the sale of the luxury yacht Alfa Nero, which cannot be expected annually. He also noted that high wage and pension obligations limit the government’s ability to cut spending quickly, while external factors such as climate shocks and potential slowdowns in the U.S. tourism market pose ongoing risks.

On governance and transparency, the FROC advised Cabinet to maintain a focus on keeping primary surpluses of at least 1.5–2 percent of GDP and to view the ECCB’s 60 percent debt target as a guide, rather than a strict ceiling, suggesting that levels between 65 and 70 percent may still be manageable if revenues remain strong.

Among the committee’s immediate recommendations were:

Development of a debt operations note to explore swaps, reprofiling, and rating improvements; examination of new revenue measures, including property tax reform and a Blue Carbon Roadmap built around seagrass and seabed assessments; introduction of performance-linked pay and means-testing for social support; adoption of an arrears clearance policy; and institutionalizing semi-annual FROC reports with public briefings.

Cabinet commended the FROC team for its work and said it looks forward to receiving more frequent updates.