Grenada - Services

Tourism is the biggest part of Grenada's economy, bringing in an estimated $66.8 million in receipts in 1999. Much of the island's tourist industry is still in local hands, and there is considerable " trickle down " within the economy, benefiting local farmers, restaurant owners, and taxi drivers in particular. Grenada has expanded its tourism infrastructure, and there are now approximately 2,500 hotel rooms, as well as developed cruise ship and yacht charter facilities. But despite steady growth in recent years, Grenada's tourism sector has encountered serious problems, including a 1999 decision by the Carnival cruise ship company to suspend calls at Grenada in the wake of the government's 1998 imposition of a $3 per capita landing fee.

The quickest growing service sector is offshore financial services, consisting of banking, insurance, and other services for foreign companies and individuals. It has expanded since 1996 and is expected to play an increasingly prominent role in the economy. There are 31 offshore banks and a large number of other financial interests, and despite some local opposition, the government is encouraging gaming as a tourist attraction. However, the financial service sector was damaged by allegations of financial impropriety in 2000 concerning one bank's operations. In March of 2001, the govern-ment—announcing that it was cracking down on bank fraud—closed down 17 offshore banks. Altogether, in 1999, the financial sector generated almost $5 million in revenues for the government.

Another growth sector is telemarketing and data processing, in which Grenada's literate but low-paid work-force can compete for contracts from North America. This sector, buoyed by the recent opening of a large facility on the east coast, created an estimated 1,000 jobs by 2000.

Retailing is not well developed in Grenada, with only a few large stores in St. George's and the nearby tourist areas. Most rural Grenadians depend on a weekly trip to the capital or small village stores for day-to-day essentials.