20210819-IMF-Estimating_the_Impact_of_External_Shocks_on_the_ECCU_Application_to_the_COVID_Shock_37页_997kb

The paper analyzes the impact of external shocks on Eastern Caribbean Currency Union (ECCU) economies, focusing on COVID-19. It uses Canonical Correlation Analysis (CCA) and dynamic panel regression to quantify effects on output growth, inflation, and external balance. Key findings include significant negative impacts of tourism shocks (e.g., COVID-19-related disruptions) and fluctuations in oil prices on GDP, with oil prices also affecting inflation. FDI and passport sales strongly boost external balance. For COVID-19, a combined shock leads to substantial GDP contractions and current account deteriorations, varying by tourism dependency. The study underscores the importance of external shocks for ECCU policy planning and resilience.