Dominica - Services

Dominica's tourist industry is in its infancy compared to other Caribbean islands. For many years its rugged terrain, lack of beaches, and underdeveloped infrastructure prevented large-scale tourist development. In recent years, Dominica has successfully marketed itself as the "nature island of the Caribbean," seeking to attract "eco-tourists" interested in landscapes and wildlife. The government realizes that intensive tourism is incompatible with preserving the island's eco-system and in 1997 signed an agreement with Green Globe, the environmental division of the World Travel and Tourism Council, to develop the island as a "model ecotourism destination." The 3-year program provided technical expertise on environmental management as well as helping to market Dominica through specialist travel companies.

At the same time, the government has encouraged a steady increase in Dominica's tourism capacity, with several new hotels being built and considerable investment in cruise ship facilities. The new cruise ship jetty at Prince Rupert Bay, near Portsmouth, has dramatically increased the number of ships calling annually and brought significant tourism-related opportunities to the formerly depressed community of Portsmouth. Annual tourist arrivals are estimated at approximately 200,000, of whom about 75,000 are stay-over visitors. The great majority are cruise ship visitors who spend limited time and money on the island. Tourism receipts in 1998 were estimated at US$15.5 million.

Dominica's tourism industry is mostly small in scale and locally owned, with extensive links to other areas of the economy. Unlike other Caribbean islands, visitors are fed with locally produced food, and Dominica does not unduly extend its import bill by importing foodstuffs for the tourist sector. There is also considerable " trickle down " of tourism revenues, with retailers, restaurateurs, and tourist guides benefiting directly from the industry. On the other hand, critics point out that even restricted tourism can have a damaging impact on the environment, especially at the selected sites of natural beauty visited by large numbers of cruise ship tourists.

If the tourism industry has caused some controversy by threatening to spoil Dominica's fragile ecosystem, some initiatives taken by the government since the 1990s have been even more open to criticism. Like other small Caribbean economies, Dominica has tried to broaden its economic base by building up an offshore financial services sector. So far, a relatively small number of offshore banks and other international business companies (IBCs) have registered in Dominica, but the government is trying to attract more by making registration economical and easy. A Dominica-based IBC can, for instance, be formed over the Internet, and the government has also granted operating licenses to several Internet gambling companies. The ease with which such companies can be formed and the secrecy surrounding their operations have led some critics to allege that Dominica may be facilitating money-laundering and tax evasion.

Even more controversial has been the issuing of "economic citizenship" to foreign nationals. This means that Dominican passports are provided in return for an

Trade (expressed in billions of US$): Dominica
Exports Imports
1975 .011 .021
1980 .010 .048
1985 .028 .055
1990 .055 .118
1995 .045 .117
1998 N/A .136
SOURCE: International Monetary Fund. International Financial Statistics Yearbook 1999.

agreed minimum investment, which is supposedly used to develop the national economy. The first economic citizens were mostly Taiwanese, but in 1999 it was reported that 300 Russians had bought Dominican passports for US$50,000 each. This has encouraged allegations that the island may be involved in Mafia-style economic activity.

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