Dominica - Economy
Traditionally the economy has been dominiated by agriculture (particularly bananas and coconuts), fishing, and forestry, but light industry (soap production) and tourism have seen some growth. About 40% of the population is employed in agriculture, and most in bananas. However, the banana exports have been declining steadly in recent years due to weak export prices, the gradual elimination of preferences in the European market, inefficent farming methods, and adverse weather conditions. From 1998 to 2000, banana exports fell 24.6%, and then in the global slowdown of 2001, fell another 35.4%. Tourism is a potential source of income but it is relatively underdeveloped; still lacking are a jet airport, a good system of roads, and luxury hotels. There has no white sand beaches, but Dominica does have the highest peak in the Caribbean, rainforests, waterfalls, hot springs, and over 200 rivers to attract hikers, naturalists, and divers. Cruise liners began dropping anchor at Dominica in 1999. The government is promoting industrial development involving agroprocessing and light industry, and hopes to build an airport. With the decline of banana exports, GDP growth had been declining. In the late 1980s, average annual GDP growth was 5.5%; in the early 1990s, about 3.5%, and from 1996 to 1999, 2.5%. In 2000, GDP stagnated, but in 2001, there was a contraction of about 4.5% as adverse weather, a drop in tourism, and reduced export demand added to the effects of declining banana production. Consumer prices have been very stable, with inflation averaging about 1.1% 1998 to 2001. For 2002, GDP at current prices is estimated to have increased 1%, with inflation at 1.7%.