Economic conditions in Saint Lucia were severely compromised in 2020 due to the impact of the global COVID-19 pandemic. Real gross domestic product (GDP) is estimated to have plummeted by 20.4%, on account of a major contraction in tourism, the main driver of economic activity. Consequently, fiscal conditions deteriorated markedly, and public debt increased. In the financial sector, commercial bank credit to the private sector grew while external conditions worsened.

The economic outlook is cautiously optimistic. Growth is projected to rebound to 3.4% in 2021. However, risks to the outlook are tilted heavily to the downside largely due to the ongoing impacts of COVID-19 and the country’s high vulnerability to natural hazards.