DBEDT forecasts uptick in state’s 2014 economic growth

A decline in the visitor industry since September has caused Hawaii’s economic growth to slow at year’s end, although the economy is poised to perform better in 2014, according to a state forecast released today.

Hawaii’s economy is expected to grow by 2.4 percent in 2013, slightly slower than the 2.6 percent growth rate estimated by the state Department of Business, Economic Development and Tourism in its previous forecast released three months ago. Economic growth, as measured by gross domestic product, is expected to accelerate to 2.8 percent in 2014.

The main driver behind the downward revision is a in visitor arrivals and spending in recent months that can be attributed to the federal government shut down in October and the depreciation of the Japanese yen, according to DBEDT. Record-high hotel room rates in Hawaii are also a factor in visitors’ choosing other destinations, the agency said.

Despite the recent monthly declines in arrivals and spending the visitor industry is still on track to break records this year in both categories, according to DBEDT. The department’s forecast calls for 8.3 million visitors to spend $14.8 billion dollars in Hawaii this year. That would exceed last year’s record performance when 8 million visitors spent $14.4 billion.