ST. KITTS AND NEVIS
Federation of Saint Kitts and Nevis
LOCATION AND SIZE.
St. Kitts and Nevis are islands in the Caribbean Sea, in the Leeward Island chain to the west of Antigua. The area of the twin-island state is 261 square kilometers (101 square miles), with St. Kitts occupying 168 square kilometers (65 square miles) and Nevis 93 square kilometers (36 square miles). The country is approximately 1.5 times the size of Washington, D.C., and has a coastline measuring 135 kilometers (84 miles). The capital and main settlement of St. Kitts, Basseterre, is on the island's southern coast, while Charleston, the main town of Nevis, lies on the west coast.
The population of St. Kitts and Nevis was estimated at 38,819 in July 2000, a fall of 0.22 percent on the previous year's figure and a decline from the mid-1998 estimate of 40,700. According to the Caribbean Development Bank (CDB), the islands' population declined by an annual average rate of 2.4 percent between 1995 and 1998. The principal reason for the falling population is emigration , estimated at 11.85 migrants per 1,000 population in 2000. This migration is caused by labor mobility and a lack of employment and other opportunities on the islands.
Most Kittitians and Nevisians are of African descent, and there are smaller communities composed of people of mixed race and European descent. There is a small community in St. Kitts descended from immigrants of Middle Eastern origin. The population is fairly evenly distributed over age groups, with 30 percent of people aged between 1 and 14.
This sector was badly hit by the effects of the hurricanes in 1998 and 1999. The country had just started to rebuild after Georges in 1998 when Lenny created substantial damage in 1999. The Port Zante complex, where the pier and terminal buildings are located, suffered serious damage. In Nevis, the only large hotel was forced to close for 6 months, resulting in lay-offs of staff (al-though many were employed to re-landscape devastated gardens) and decreased government revenue. Overall visitor arrivals, both of those staying over and those on cruise ship calls, fell about 15 percent in 1999, with a resulting decrease in visitor expenditure from the 1998 figure of US$75.7 million.
Tourism has become important to St. Kitts and Nevis, which has created a network of often small but upmarket hotels and guesthouses in former plantation houses. Larger hotel complexes exist as well, especially in the Frigate Bay area of St. Kitts where there are golf courses, casinos, and condominiums. Cruise ships have become an important part of the tourist industry, especially since the construction of the Port Zante terminal. Tourism is vital to Nevis, where manufacturing and other economic activity is much less diversified than in St. Kitts. There is considerable concern that any slowdown in the United States or European economies could have a serious effect on the tourist industry if U.S. and European consumers should decide they cannot afford a Caribbean vacation.
As elsewhere in the Eastern Caribbean, financial services are of growing importance. This is especially true in Nevis, which has a reputation as an efficient and discreet tax haven. Most investors are based in North America and Europe, and few are local. The banks and other businesses offer services to customers, individuals, and businesses seeking to avoid taxation in the countries in which they are based. According to the IMF, the current legal framework "provides for a high degree of confidentiality and for income tax exemption." In early 2001 the international Financial Action Task Force (FATF), supported by European and North American governments, named St. Kitts and Nevis, among other Caribbean countries, as a suspected location of financial irregularities. The government has agreed to close loopholes in its legal and regulatory structures about offshore financial transactions. There are several dozen banks and other businesses based in St. Kitts-Nevis, but they provide little local employment, as most business is conducted electronically. Details as to customer identity and the value of deposits are well-kept secrets.
St. Kitts and Nevis has no territories or colonies.
The currency of St. Kitts and Nevis is the Eastern Caribbean dollar (EC$). One EC dollar equals 100 cents. There are coins of 10, 20 and 50 cents, and notes of 5, 10, 20, and 100.
Machinery, food, electronics, beverages, tobacco.
CHIEF IMPORTS: Machinery, manufactures, food, fuels.
GROSS DOMESTIC PRODUCT:
US$274 million (purchasing power parity, 2000 est.).
BALANCE OF TRADE:
Exports: US$53.2 million (2000 est.). Imports: US$151.5 million (2000 est.).