Saint Lucia Economy - overview

Economy - overview: The island nation has been able to attract foreign business and investment, especially in its offshore banking and tourism industries, with a surge in foreign direct investment in 2006, attributed to the construction of several tourism projects. Although crops such as bananas, mangos, and avocados continue to be grown for export, tourism provides Saint Lucia's main source of income and the industry is the island's biggest employer. The tourism sector is likely to face declining revenues with the global economic downturn as US and European travel declines. The manufacturing sector is the most diverse in the Eastern Caribbean area, and the government is trying to revitalize the banana industry, although recent hurricanes have caused exports to contract. Saint Lucia is vulnerable to a variety of external shocks including volatile tourism receipts, natural disasters, and dependence on foreign oil. The public debt-to-GDP ratio is about 70% and high debt servicing obligations constrain the KING administration's ability to respond to adverse external shocks. Economic fundamentals remain solid, even though unemployment needs to be reduced.

Definition: This entry briefly describes the type of economy, including the degree of market orientation, the level of economic development, the most important natural resources, and the unique areas of specialization. It also characterizes major economic events and policy changes in the most recent 12 months and may include a statement about one or two key future macroeconomic trends.

Source: CIA World Factbook - Unless otherwise noted, information in this page is accurate as of September 17, 2009