turn to the outlook for 2013. first, it is evident that uncertainty is weighing heavily on external conditions. overall, global prospects have weakened and in its october 2012 world economic outlook, the imf lowered its forecasts for world economic growth to just over 3½ per cent in 2013 ( from an earlier estimate of almost 4 per cent for 2013 ). projections for growth in the united states have been trimmed slightly, with a larger downward revision for the euro area. the implications of these external conditions for our regional economies are mixed. guyana and suriname are expected to show robust growth. jamaica and barbados are likely to experience sluggish growth. what is clear, however, is that policymakers in the caribbean must begin to rethink their policy strategy and consider more innovative approaches to financing in order to help solve their onerous debt dilemma. here at home, certain domestic factors seem to suggest a cautiously optimistic outlook for 2013. • first, as noted earlier, there are some underlying signs of an incipient recovery this year. preliminary estimates from the central bank suggest a turnaround in the trinidad and tobago economy, with real gdp growth expected to be around ¾ per cent in the third quarter of 2012. a revival in the production of natural gas and liquefied natural gas ( lng ) is expected to increase activity in the energy sector by some ½ per cent in the third quarter of 2012. a better performance in the finance sector and a slight increase in construction should support overall growth of 1 per cent in the non - energy industrial base. the full completion by firms in the energy sector of their major maintenance operations would provide a further strong boost to growth in 2013. • second, there have been indications of a modest improvement in the pace of project implementation at the level of the central government. in fy2010, the below budget public sector investment program ( psip ) was 10 per cent below budget. this improved to 4 per cent below budget in fy2011 and to around 1½ per cent below budget in fy 2012. • third, for the most part businesses should not be facing major credit constraints. the launch of the clico investment fund ( cif ) on november 1 should give a cautious boost to overall confidence and reinforce the economic growth trend. based on these underlying assumptions and the turnaround in the third quarter, the central bank is maintaining its projection for real gdp growth of around 1 per cent for all of 2012, and growth is expected to strengthen to 2 ½ per

by 13. 7 per cent year on - year in 2008, bank credit outstanding declined by 4 per cent in the year to november 2009. this is a significant reversal. the absence of credit demand is being reflected in record levels of excess liquidity and historically low savings rates. notwithstanding government ’ s expansionary fiscal stance, to facilitate an economic rebound in 2010, there must be some resurgence in business activity. and, this is not as far fetched as some would like to believe as many of the pre - conditions for such a rebound already exist. let me cite a few : • inflation has come down sharply, to the lowest level in decades. this, together with the slack in labor markets, should result in an easing of wage pressures, which should help business recovery. • oil and gas prices have stabilized at higher prices than we expected a year ago. oil prices, which were targeted in the budget at us $ 55 per barrel are now hovering between us $ 75 – us $ 80 per barrel. gas prices, which were targeted in the budget at us $ 2. 75 per mmbtu are now in the region of $ 5. 00 – $ 6. 00 per mmbtu. these higher prices are important for several reasons. • first, the record shows that strong oil and gas prices serve to bolster consumer and business confidence. • second, these higher prices should strengthen fiscal performance, compared with budget, reducing the projected budget deficit, thus supporting subdued inflation, low interest rates and a strong foreign reserve position. all these factors are conducive to an economic rebound. • banks ’ lending rates are the lowest they have been in years and banks have an abundance of funds for credit expansion. and with interest rates likely to remain low for some time, private construction and other projects, which were postponed for the last year, could now be taken up. • indications are that recovery in regional markets that rely on tourism and workers ’ remittances will lag behind that of trinidad and tobago. for a while, therefore, business activity will need to rely even more than before, on the domestic market. however, the replenishment of inventories, after a year of de - stocking, should also provide for an increase in domestic demand. but the immediate urgency of an economic rebound in 2010, should not blind us to the overriding longer term goal, which is the achievement of self - sustaining growth to maintain our living standards. to achieve this, a meaningful economic