Caribbean may be hit by US recession

The Caribbean Islands will be facing slowdown in tourism if the US recession comes to pass, yet investors still see potential here.

The IMF - International Monetary Fund - said Tuesday that a US recession or slowdown will hurt the economies of the Caribbean Islands, especially those in the Eastern Islands.
A large factor will be tourism which is heavily dependent on US visitors each year. Another key factor is the Eastern Caribbean dollar which is linked to the value of the US dollar, which is also facing a lowering of value.

At the same time, property investment in the Caribbean Islands is a large factor in the area's growth. Two large groups of people are continuously coming here for their investment needs. One is the baby boomer generation from the US which is retiring and moving to the Caribbean, or at least purchasing second properties here.

The second sector is that of younger Brits who see the investment potential in the islands and are making it a target for their portfolio.

Part of the benefit here comes in the form of fractional ownership in properties, which has been a driving force behind both of these sectors of investment. In this type of ownership plan, home owners are allotted a certain number of weeks per year to occupy the property. This differs from a time share because property owners take advantage of appreciation and tax deductions coming from the fact that they own the property.

Whether these investments continue to be important in a struggling economy is uncertain at the present time.

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