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Dominica

Economy

Dominica had a gross domestic product (GDP) of $248 million in 2002, or $3,440 per person. GDP is a measure of all the goods and services a country produces. The island’s fertile volcanic soils provide a good basis for farming, and Dominica continued to have an economy based on agriculture into the 1990s. The main export product is bananas, the quantity and value of which fluctuate according to the weather. Hurricanes periodically wipe out much of the crop.

Banana producers suffered with the opening of the European Union (EU) market in 1992, which has forced them to compete with U.S. producers that have large plantations on mainland Latin America. Banana prices fell on the world market, and farmers in the Windward Islands found it impossible to match the economies of scale of multinational corporations on the mainland. The EU in 1993 imposed quotas on banana imports that were favorable to Caribbean producers, but the United States challenged the quotas through the World Trade Organization (WTO). In 1999 the WTO ordered the EU to end preferential quotas.

Coconuts are also grown on Dominica and used primarily to make soap and cooking oil. Coconut-based toiletries now account for over 20 percent of the island’s exports. Other crops are being promoted to diversify the economy away from reliance on bananas. They include coffee, cacao, mangoes, citrus fruit, and root vegetables.

Pumice is quarried and exported on Dominica. Manufacturing is on a small scale and largely limited to the processing of farm products. The main manufactured goods are fruit juices, alcoholic beverages, soap, and essential oils. The island also has electronic assembly plants, data-processing companies, and garment manufacturers.

The government promotes Dominica’s “nature island” image to attract tourists. Beaches are few, but the island’s wildlife and natural beauty bring ecotourists. Increasing numbers of visitors come for the rain forest, birding, hiking, scuba diving, and whale watching.

The currency is the East Caribbean dollar (2.70 East Caribbean dollars equal U.S.$1; 2006 average).

 
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