ECONOMY
Banana production employs upwards of 60% of the work force and accounts for 50% of merchandise exports in St. Vincent and the Grenadines, with an emphasis on the main island of St. Vincent. Such reliance on one crop has made the economy vulnerable to fluctuations in banana prices and reduced European Union trade preferences. To combat these vulnerabilities, the Government of St. Vincent and the Grenadines is focused on diversifying its economy away from reliance on bananas. Recently, there has been a parallel reduction in licit agriculture and a rise in marijuana cultivation, making St. Vincent and the Grenadines the largest marijuana producer in the Eastern Caribbean.
In contrast to developments on the main island, tourism in the Grenadines has
grown to become a very important part of the economy, and the chief earner of
foreign exchange for the country as a whole. The Grenadines have become a
favorite of high-end tourism and the focus of new development in the country.
Super-luxury resorts, yachting tourism, and a commitment by the government to
rehabilitate and protect the Tobago Keys as a national park have all contributed
to strong tourism returns in the Grenadines.
St. Vincent and the Grenadines' currency is the Eastern Caribbean Dollar (EC$), a regional currency shared among members of the Eastern Caribbean Currency Union (ECCU). The Eastern Caribbean Central Bank (ECCB) issues the EC$, manages monetary policy, and regulates and supervises commercial banking activities in its member countries. The ECCB has kept the EC$ pegged at EC$2.7=U.S.$1.
St. Vincent and the Grenadines is a beneficiary of the U.S. Caribbean Basin Initiative that grants duty-free entry into the United States for many goods. St. Vincent and the Grenadines also belongs to the predominantly English-speaking Caribbean Community and Common Market (CARICOM) and the CARICOM Single Market and Economy (CSME).
GDP (2006): $422.5 million.
GDP growth (2005): 4.9%.
Per capita GDP (2005): $3,594.
Inflation (2006): 3.0%.
Natural resources: Timber.
Agriculture: Mostly bananas.
Industry: Plastic products, food processing, cement, furniture, clothing, starch, and detergents.
Trade (2005): Exports--$40 million (merchandise) and $155 million (commercial services). Major markets--European Union (27.2%), Barbados (12.7%), Trinidad and Tobago (12.3%), Saint Lucia (10.9%), and the United States (9.2%). Imports--$240 million (merchandise) and $74 million (commercial services). Major suppliers--United States (33.3%), Trinidad and Tobago (23.6%), European Union (15.1%), Japan (4.2%), and Barbados (3.9%).
Official exchange rate: EC$2.70 = U.S. $1.
