Saint Vincent and the Grenadines Economy Facts
Saint Vincent and the Grenadines is a small island nation and the poorest of the states of the eastern Caribbean. The economy has traditionally been dominated by agriculture and not least the banana industry, but nowadays service is the most important sector.
The country belongs to the UN category “small island nations under development”, which is characterized by a relatively small population, limited resources, exposure to natural disasters and sensitivity to fluctuations in world market prices and international economic conditions. Unemployment is stubbornly high, not least among young people and women. The EU is the largest donor, followed by Japan and international development agencies. Money shipments from vincentia abroad make an important contribution to the economy.
- Countryaah.com: Major imports by St. Vincent and The Grenadines, covering a full list of top products imported by the country and trade value for each product category.
The hospitality industry is the most important part of the service sector, although tourism is relatively modest compared to other countries in the Caribbean. The inauguration of a new airport in 2017 raises hopes of increased tourist influx and thus increased growth.
In the country there is also a financial sector with several thousand foreign offshore companies that utilize favorable tax and capital management rules, often without having any real business in the country. The offshore sector risks attracting financial crime. In the early 2000s, Saint Vincent ended up on two international agencies’ blacklists of countries that did not do enough to prevent money laundering (that is, turning illegally earned money into legal). After the government tightened control and closed many banks, the country was removed from the lists. At the end of the 1990s, the country was placed on a “gray” list of countries that did not cooperate sufficiently in the exchange of information on taxes, but were also removed from there after taking measures. Saint Vincent managed to escape the EU: s first black list of tax havens in 2017 by promising to improve transparency. However, the United States has overseen the country and sees great risk of money laundering with links to drug smuggling and the offshore sector.
- Abbreviationfinder.org: Check this abbreviation website to find three letter ISO codes for all countries in the world, including SVG which represents the country of St. Vincent and The Grenadines. Check findjobdescriptions to learn more about St. Vincent.
Agriculture still plays an important role in, among other things, employment and agricultural commodities dominate commodity exports.
Banana exports to the UK first and later to other parts of the EU were central to the economy of the 1950s. The bananas accounted for over half of the exports of goods in 1990, but the share had fallen to around one-twentieth 25 years later. Exports then basically only went to countries in the Caribbean.
The decline in the banana industry was partly due to adverse weather conditions (see Agriculture and Fisheries), and increasing international competition. From the 1990s, the EU was forced to gradually change its favorable conditions for importing bananas from ancient colonies in the Caribbean and Africa and the Pacific, regulated in the Lomé Conventions and from 2000 in the subsequent Cotonou Agreement. This happened after a protracted trade dispute, the “banana war”, between the EU and the US (and US banana companies) as well as countries in Latin America. Finally, the EU was forced to agree to reduce tariffs on Latin American bananas, despite the risk of hitting hard on the small producers in the Caribbean, for example. Within the framework of the Cotonou Agreement, a number of Caribbean states have also concluded an economic partnership agreement with the EU, which provides a gradual transition to less protected markets (see also Foreign Trade).
Saint Vincent and the Grenadines and the other member states of the OECS regional organization (see Foreign Policy and Defense) have a single currency, the eastern Caribbean dollar, which has been linked to the US dollar since the 1970s.
FACTS – FINANCE
GDP per person
US $ 7,378 (2018)
US $ 813 million (2018)
2.6 percent (2018)
Agriculture’s share of GDP
6.7 percent (2018)
Manufacturing industry’s share of GDP
5.0 percent (2018)
The service sector’s share of GDP
62.3 percent (2018)
1.4 percent (2019)
Government debt’s share of GDP
74.5 percent (2018)
US $ 337 million (2017)
eastern Caribbean dollar
Assistance per person
US $ 67 (2017)