The Department of Economic Policy & Research (DEPR) hereby provides the Third Quarter Economic Report. In this report we look at the main economic indicators such as Turn-Over-Tax (TOT), Stay-over Tourism, Cruise Tourism, First and Second Quarter Banking Statistics (i.e. Loans & Deposits), Island and Federal Government revenue, GEBE (i.e. water and electricity), and Businesses Opening and Closing. Unfortunately, at the time of compiling this report figures on Foreign Exchange and the Third Quarter banking figures on were not available.

Despite the above-mentioned, DEPR was able to compile the relevant statistics to acquire a picture of the economy, mainly by utilizing historical data (i.e. 1998-2002) to ascertain a trend pattern. By using this method, we can describe the economy, as recovering slowly from its slippage. According to a Press Release of the CBS, inflation has remained relatively flat at 1% in August 2002.

To support these findings, TOT has begun its upward swing in the third quarter. In the first and second quarter TOT observed a less than 1% increase, whereas in the third quarter TOT increased significantly. The increase of TOT in the Third quarter 2002, compared to 2001, of 7.4% is an increase that is strong, however this increase is regarded as cautiously optimistic as the third quarter of the previous year 2001, experienced the tragic events of September 11, 2001. To further illustrate the increase, we compared the third quarter of 2002 with previous years such as 2000 and 1998, where even greater increases were observed of 18.8% and 56.8%, respectively. These figures illustrate a definite recovery of the economy. Considering that the third quarter also experienced a dramatic increase in cruise tourism, it would be safe to assume that cruise tourism is the primary stimulant of the economy, in particular, when we consider the performance of some of the other tourism sectors.

It should be noted that the total TOT performance (i.e. quarters 1-3, 2002) is still relatively low, however the recovery pattern is evident. If this pattern remains consistent, the economy will definitely observe an increase, though marginal after factoring inflation. The inflation rate is expected to remain flat around 1%.

As anticipated in our Half Year Economic Report 2002, there were signs that a rebound is expected in the second half as many of the key economic indicators have shown a rebound. To support this finding, we see that stay-over tourism has observed a decrease in the first half of 2002, compared to the first half of 2001. However, in the third quarter stay-over tourism witnessed a marginal increase of 1.3%. Though relatively small, it is considered significant when we compare the decreases of 16.5% and 11.7% in the first and second quarters of 2002.