Barbados’ economy expanded by 2.7 per cent over the first nine months of 2025, driven by strong gains in tourism, agriculture, and construction, according to the Central Bank of Barbados. The island also recorded its lowest unemployment rate ever — 6.1 per cent — as foreign exchange inflows from visitor arrivals and cruise traffic strengthened economic resilience.
At a press conference reviewing third-quarter performance, Central Bank Governor Dr Kevin Greenidge described the island’s growth as “steady and broad-based,” noting that it came despite global trade tensions and slower economic expansion among advanced economies.
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Tourism and Cruise Arrivals Lead Economic Gains
Tourism remained the key growth driver, supported by increased airlift, expanded marketing campaigns, and major cultural events such as Crop Over and CARIFESTA.
Between January and September 2025, long-stay arrivals rose 5.5 per cent to 537,897 visitors. The United States led the growth, accounting for 36 per cent of arrivals and increasing by 12 per cent as airlines added new routes from Boston, New York, Philadelphia, and Atlanta. European arrivals climbed 15.5 per cent, while the CARICOM market grew 8.2 per cent with additional flights by Caribbean Airlines and InterCaribbean Airways.
Arrivals from the United Kingdom and Canada declined slightly — by 2.6 per cent and 1.1 per cent respectively — due to reduced airline seating capacity.
Cruise tourism also surged, with in-transit passenger arrivals up 31.5 per cent to 496,256 visitors, despite an 8.4 per cent decline in cruise calls to 262. Larger vessels and higher passenger occupancy rates offset the reduced number of calls, making Barbados the top-performing cruise destination in the Caribbean during the period, with growth of 33.5 per cent, compared to the regional average of 5.1 per cent.
The combined increase in long-stay and cruise visitors lifted tourism value-added by nine per cent, reinforcing the sector’s role as Barbados’ primary source of foreign exchange earnings.
Steady Macroeconomic Performance
The Central Bank reported that the country’s external position remained strong, supported by record tourism receipts and higher long-term financing. International reserves stood at US$3.3 billion at end-September, bolstered by travel credits and capital inflows.
Fiscal performance also improved, with tax revenues outpacing expenditure. The primary surplus reached $574.1 million (3.8 per cent of GDP), while the overall fiscal surplus stood at $227.1 million (1.5 per cent of GDP). The debt-to-GDP ratio declined by 2.9 percentage points to 100.1 per cent by the end of September.
Inflation remained low, easing to 0.5 per cent by August, thanks to lower import costs and declining prices in housing, transport, and utilities.
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Construction, Agriculture and Services Drive Broader Growth
The growth extended across both traded and non-traded sectors. Agriculture benefited from stronger harvests of root crops, fruits, and vegetables, offsetting lower milk and fish production. Construction grew 6.1 per cent, led by hotel, residential, and commercial projects, as well as government infrastructure upgrades.
Manufacturing saw modest gains in food processing and non-metallic minerals, while business and other services continued to expand.
Record Employment Levels
The unemployment rate fell to 6.1 per cent at the end of June 2025, the lowest level ever recorded. Job creation was strongest in agriculture, utilities, tourism, construction, transportation, and business services.
Dr Greenidge credited the private sector’s expansion and government investments for sustaining job growth and reducing economic inactivity. “The improvement in labour market conditions demonstrates the broad reach of our economic recovery,” he said.
Outlook
The Central Bank remains cautiously optimistic about the outlook for 2026, with continued gains expected in tourism and construction, alongside low inflation and fiscal stability.
Dr Greenidge concluded, “Our performance in 2025 underscores Barbados’ resilience and the success of ongoing reforms. As visitor arrivals rise and investment flows strengthen, the economy is well positioned for sustainable growth in the coming year.”
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