St. Vincent and the Grenadines - Money

Saint Vincent and the Grenadines has experienced steady growth in GDP in recent years (except in 1994), averaging over 3 percent annually since the mid-1990s. In 1999, GDP growth stood at 4.5 percent, a fall from the 1998 figure of 5.7 percent. This economic progress reflects a steady increase in tourism and the revenues generated by financial services, which has partly counter-balanced problems in the banana industry. Inflation has been low in recent years and, in 1999, was estimated at less than 1 percent. As a result, consumer prices are relatively low, and visitors from neighboring islands such as Grenada and Barbados now come to Saint Vincent to take advantage of lower prices.

Saint Vincent and the Grenadines' financial stability is in part because of its membership in regional financial institutions. The Eastern Caribbean dollar, a currency shared with the 7 other members of the Eastern Caribbean Central Bank (ECCB), is stable and has been pegged at a rate of EC$2.7: US$1 for many years. This means that Saint Vincent and the Grenadines is not particularly vulnerable to fluctuating exchange rates , although transactions with Europe have been affected by the low value of the euro. There are plans for ECCB member countries to participate in a regional stock exchange, further integrating the economies of the small islands, but by early 2001 little real progress had been made.