Speaker, following an unusually rapid pace in 2004, the
rate of growth of global output slowed to about 4 percent
in 2005 although remaining above long-term potential.
As a result of rising oil and commodity prices and less
expansionary macroeconomic policies, global economic growth
is expected to slow further to around 3 to 3.5 percent
Mr. Speaker, Trinidad and Tobago's economic prospects
for the next few years are particularly encouraging. We
do not expect oil prices to fall below US$45-$50 per barrel
over the medium term and also expect natural gas and petrochemical
prices to remain buoyant. With BHP Billiton's operations
moving towards capacity, oil production is expected to
reach 165,000 barrels per day by 2006/2007, reversing
the trend of the past several years. In terms of natural
gas, the start-up of Train IV will increase total gas
utilization for LNG production and almost double output
from the LNG facility to 15.1 metric tones per annum (mtpa).
This increase will position Trinidad and Tobago as one
of the leaders in LNG production in the world. Output
in the petro-chemical sector is also expected to expand
sharply with the expected commissioning of at least five
(5) new plants in the petrochemical sector.
In the non-energy sector, construction activity will remain
at a very high level as a result of our housing thrust,
our infrastructure works programme, and ongoing work on
several large public sector construction projects, while
our tourism sector will continue to post significant gains.
With the aid of measures included in this Budget, we envisage
increased activity in manufacturing and the start of a
turnaround in agriculture.
Real GDP growth is projected to increase from 6.5 percent
in 2005 to around 8 percent in 2006 with the unemployment
rate declining to below 7 percent and inflation contained
to around 5 percent.