8 BARBADOS PUBLIC WORKERS’ CO-OPERATIVE CREDIT UNION LIMITED This section of the Annual Report provides a discussion and analysis of the financial position and performance of the Barbados Public Workers’ Co-operative Credit Union Limited (BPWCCUL) for the financial year ended March 31, 2025, as compared to the financial year ended March 31, 2024. The Management Discussion and Analysis (MD&A) should be read in conjunction with the audited financial statements, which have been prepared in accordance with International Financial Reporting Standards (“IFRS”). Barbados’ Economic Performance 2025 Barbados demonstrated solid economic fundamentals during the first quarter of 2025 as reported by the Central Bank of Barbados. This period was marked by significant growth across several key sectors, improved fiscal operations, and a strengthened external position. These achievements highlight the resilience and strategic planning that continue to propel the nation forward amidst complex global economic dynamics. The economy experienced a real GDP growth rate of 2.6 percent, driven by robust performances in the tourism, business services, and construction sectors. Inflation reached a 12-month moving average of 0.9 percent, reflecting a decline during the quarter. Meanwhile, unemployment stood at 7.1 percent as of September 2024, indicating stability in the labour market. International reserves also increased notably by $194.6 million to reach $3.4 billion, providing 32.4 weeks of import cover. However, the current account deficit widened to $52.6 million, underscoring the challenges of managing external financial flows. Encouragingly, gross public sector debt reduced to 102.8 percent of GDP, demonstrating prudent fiscal management. A Summary break-down of Macro-economic Developments • The tourism industry significantly contributed to economic growth this quarter. Long-stay arrivals increased by 2.4 percent, driven by strong performances from the U.S. and European markets, which rose 13 percent and 13.9 percent respectively. Cruise tourism reached a record 385,468 in-transit passengers, up 37.1 percent. Hotel occupancy rose to 80.5 percent, and revenue per available room (RevPAR) surged 23.8 percent, highlighting sector vitality. Management Discussion & Analysis (MD&A) • In agriculture, root crop production increased 23.9 percent, despite a 9.1 percent decline in fruits and vegetables output fell by 9.1 percent, and a sharp 16.8percent drop in milk production declined sharply by 16.8 percent due to equipment issues. The manufacturing sector showed flat performance, with furniture production declines offset by food (up 3.8 percent) and beverage growth (up 9.9 percent). Construction grew 6.4 percent, supported by major private and public investments. • The labor market showed mixed trends; jobless claims decreased in January and February but rose in March due to hotel renovations. However, net job creation was 9,000, with tourism and construction as key employment growth drivers. • Barbados’ fiscal operations were noteworthy, with the primary surplus increasing to $662.8 million, or 4.6 percent of GDP, fueled by higher corporate taxes and controlled spending. The fiscal deficit narrowed to $87.1 million, just 0.6 percent of GDP, while capital expenditure rose significantly to $632.8 million, emphasising infrastructure and climate resilience projects. • Externally, the current account deficit widened due to higher imports and income outflows, although improved tourism receipts provided a positive offset. Merchandise trade saw imports grow by 13.3 percent, while exports declined by 2.6 percent. Financial Sector Developments The financial sector remained stable, marked by improved credit quality, high liquidity, and strong profitability,
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