Our comprehensive assessment of Puerto Rico's operating environment and the outlook for its leading sectors are formed by bringing together a wealth of data on global markets that affect Puerto Rico, as well as the latest industry developments that could impact Puerto Rico's industries. This unique integrated approach has given us an impeccable track-record for predicting important shifts in the markets, ensuring you’re aware of the latest market opportunities and risks in Puerto Rico before your competitors.
Puerto Rico Country Risk
Bermuda's prolonged recession continued into 2014, and we now expect this economic contraction to continue over the coming years. We expect that an international crackdown on offshore financial centres such as Bermuda will lead to a decline in financial services activity, one of the key contributors to the island's economy. Although tourism will rise, it will not be enough to offset tempered insurance activities.
Bermuda's current account will remain in surplus over the course of our 10-year forecast period, though the surplus will decrease to 10.4% of GDP by 2024, down from 17.4% in 2014, in line with our projections for slowing exports of tourism services and secular decline in off-shore finance.
Despite poor growth prospects, Bermuda will remain politically stable over the next 10 years owing to the...
Puerto Rico Country Risk
A gradually improving tourism sector and strong private consumption growth will drive robust real GDP growth rates in the Dominican Republic in the coming years.
Puerto Rico to remain in a recession through 2015 amid high unemployment and weak investment, and see a high likelihood of additional defaults following the missed debt servicing payment by the Public Finance Corporation.
Reforms in Cuba are headed in a positive direction, and investor interest is on the rise, however the country's transition towards a more market-oriented economy will be slow, as illustrated by the incremental steps towards abolishing the dual exchange rate regime.
Major Forecast Changes:
Slumping precious metals production in an environment of low...
Puerto Rico Industry Coverage (4)
Food & Drink
Puerto Rico Food & Drink
BMI View: We are turning more positive regarding economic growth in the Caribbean, as structural and financial reforms take hold in the region, tourism numbers pick up and growth becomes stronger in key markets like the US. The large decline in the price of oil over the last year will boost the region's consumer spending, as the Caribbean is a large net oil importer. Inflation will remain low, which will help food consumption growth over the coming years. That said, many regional economies continue to be heavily indebted, which limits general investment...
Pharmaceuticals & Healthcare
Puerto Rico Pharmaceuticals & Healthcare
BMI View: While the forecast for Puerto Rico has remained at a stable trajectory, the US territory is facing an uncertain future, caused by US congressional healthcare decisions that much of the island's population feel will lead to widespread economic harm. In addition to this, Puerto Rico's reputation as being a hub of pharmaceutical and biotech manufacturing is in jeopardy due to changes to US laws that protected multinational manufacturing companies based there from US taxes.
Headline Expenditure Projections
Pharmaceuticals: USD3.02bn in 2014 to USD3.03bn in 2015; 0.28%. Forecast on par with Q415...
Puerto Rico Telecommunications
BMI View: Digicel's eventual initial public offering (IPO) plans bode well for the future of the Caribbean regional telecommunications market as additional funds raised in the initial stock offering will allow investment into next-generational networks and help expand the market further. While IPO plans are presently on hold at the eleventh hour, it also demonstrates the saturated nature of the telecoms industry in the Caribbean, with revenue and subscriber growth flattening. A key downside risk is the company's exposure to weak consumer spending trends in its core markets, an issue that could undermine investor confidence further down the line. Haiti and Cuba represent the largest organic growth opportunities in the region, as both are...
Puerto Rico Tourism
BMI View: Arrivals growth in the Caribbean will pick up to 2.7% in 2016, reflecting improved visitor numbers from Europe and North America. The Dominican Republic, St Eustatius and Cuba are expecting the highest rate of arrivals growth, but all tourism markets will experience growth in 2016.
We hold a positive outlook on the Caribbean tourism market in 2016, with growth of 2.7% marking an improvement after the lower growth rate of 1.7% in 2015. This arrivals growth is led by strong arrivals from North America and particularly from Europe. European arrivals declined in 2015 and a return to growth in 2016 will bring benefits in terms of tourist expenditure, as well as encouraging more longer-term investment. Moreover, the rebound in European tourism to the Caribbean underlines the resilience of the region's market, which remains a highly popular destination despite its relative expense....