PORT-OF-SPAIN, Trinidad & Tobago: The Trinidad & Tobago Central Bank has revised its projections and is now reporting that the country entered a technical recession at the end of 2011.
This is according to its recently released April Monetary Policy Report and Summary Economic Indicators bulletin.
In this bulletin, the Central Bank reported that economy growth for the twin-island republic had declined by 2.6 per cent in the fourth quarter of 2011 (October 1 to December 31, 2011) following a decline by the same amount in the third quarter (July 1 to September 30, 2011). This conforms to the classic definition for a recession as countries that experience two or more consecutive quarters of a declining gross domestic production (GDP) are generally defined as being in recession.
In the report, the Central Bank stated that the decline in the Trinidad & Tobago economy in the fourth quarter was driven by a “considerable reduction in activity in the energy sector of 7.8 per cent”, and while the non-energy sector increased by 1.2 per cent, this was “insufficient to offset the slippage in the energy sector”.
Across the energy sub-sectors, declines were registered in the last three months of 2011 as the exploration and production sub-sector declined by 7.2 per cent mainly as a result of an 8 per cent drop in natural gas production; the refining sub-sector declined by 15.3 per cent with liquefied natural gas (LNG) output falling by 16.5 per cent and the production of natural gas liquids dropping by 16.1 per cent; the petrochemicals sub-sector declined by 10.4 per cent and ammonia production fell by 13.3 per cent, while the output of methanol was lower by 2.4 per cent.
The central bank also reported further declines in the energy sector during the first quarter of 2012, including crude oil production that slipped to an average of 82,500 barrels a day, down from 96,900 barrels a day during the first quarter of 2011.
Natural gas production has reportedly remained depressed so far throughout 2012 with a significant decline in LNG in the first quarter by 15.4 per cent.