• Barbados:
• Economy

Barbados - Economy

Overview: Barbados has an exceptionally high ‘quality of life’ rating for a developing country. The economy, formerly a sugar monoculture, was developed over three decades to achieve a balance of growth and social development, and diversified into three main sectors: services, light industry and sugar. An offshore financial services sector, launched in 1985, has become the country’s second biggest source of foreign exchange after tourism.

Despite its economic success, Barbados experienced little growth in the 1980s and a recession in the early 1990s, when sugar and tourism earnings slumped. It had to call on the IMF for economic adjustment support and the government introduced economic austerity measures. By 1993 the economy was recovering and in 1994 it grew by 4% and continued to grow well throughout the 1990s and during 2000, driven by tourism and construction. Action against drug trafficking since the 1990s has made security and defence a significant item of expenditure.

However, after 2000 the economy went into recession due to the downturn in the USA and Europe and resulting falls in tourist numbers. With the upturn of tourism receipts in 2003, growth has been positive since with GDP growing at an average 4% p.a. from 2004 to 2006.

Trade: Main exports are chemicals, sugar, manufactured goods including electrical components and rum. Main imports are consumer goods, food/beverages, machinery, construction materials and fuels. Other CARICOM countries, the USA and the UK are the main trading partners for exports. The USA, Trinidad and Tobago, other CARICOM countries and the UK are the main sources of imports.