Breaking News: Barbados Records 2.6% GDP Growth in Q1 2025
Bridgetown, Barbados – May 2025
The Central Bank of Barbados has announced a 2.6% growth in the nation’s Gross Domestic Product (GDP) for the first quarter of 2025, signaling continued economic recovery and resilience. The positive economic performance was primarily driven by strong gains in the tourism sector, business services, and the construction industry.
In its quarterly economic review, the Central Bank credited the return of international tourists, increased foreign direct investment, and a rebound in public and private sector infrastructure projects as key contributors to this growth. The island’s tourism sector, which accounts for a significant portion of national revenue, experienced a marked increase in arrivals and occupancy rates following an aggressive winter marketing campaign in North America and Europe.
Tourism’s resurgence has also had a multiplier effect, benefiting small and medium enterprises (SMEs), restaurants, transport services, and cultural attractions. According to Central Bank Governor Dr. Kevin Greenidge, “The tourism sector has rebounded beyond expectations. With over 300,000 visitor arrivals in the first three months alone, this sector has re-established itself as the backbone of our economy.”
Business and professional services also posted solid gains, buoyed by continued interest from offshore investors and fintech firms choosing Barbados as a regional hub. The recently held Fintech Islands Experience (FiX25) attracted over 500 global delegates, including technology investors and regulators, helping to reinforce Barbados’s position as an innovation-friendly jurisdiction.
Meanwhile, construction activity rose sharply as both government and private entities pushed ahead with major infrastructure upgrades and hotel developments. Projects like the South Coast Highway Expansion and the Bridgetown Marina Redevelopment were cited as catalysts for increased employment and capital spending in the sector.
Despite the overall growth, the Central Bank highlighted certain temporary challenges. Several hotel closures for renovations during March slightly dampened the employment numbers in hospitality, reversing early gains. However, these upgrades are expected to result in long-term benefits for the tourism product.
Inflation continued on a downward trend, supported by stable food and fuel prices. The unemployment rate also showed signs of improvement, although specific figures are expected in the full report to be released later this month.
Dr. Greenidge noted that while the first quarter performance is promising, the country must remain vigilant. “External shocks such as geopolitical tensions, climate-related risks, and inflationary pressures in our source markets could pose risks to sustained growth. Therefore, macroeconomic stability and continued implementation of structural reforms under the BERT [Barbados Economic Recovery and Transformation] program remain essential.”
Looking ahead, the Central Bank remains optimistic about Barbados’s growth prospects for the remainder of 2025. With further expansions in tourism capacity, continued investment in digital transformation, and rising investor confidence, the country appears poised for steady and inclusive growth.
Stakeholders in the public and private sectors have welcomed the news, seeing it as a sign of a robust recovery following the pandemic’s economic disruptions. The government has also reaffirmed its commitment to fiscal responsibility, debt reduction, and social support for vulnerable populations.
More detailed analysis and projections are expected in the Central Bank’s full quarterly economic bulletin due later this month.