The World Bank in the Eastern Caribbean

Antigua and Barbuda, Dominica, Grenada, Saint Kitts and Nevis, Saint Lucia, and Saint Vincent and the Grenadines are member countries of the World Bank Group.

These countries, which form part of the Organization of Eastern Caribbean States, are small island developing states with a combined population of approximately 625,000. Their limited size constrains economic diversification and access to economies of scale, making them highly reliant on sectors like tourism, agriculture, and construction.

This structural vulnerability increases their exposure to external economic shocks, climate-related events, and natural disasters, which continue to challenge sustainable development across the subregion.

Economic Outlook

Countries like Dominica, Grenada, Saint Lucia, and Saint Vincent and the Grenadines continue to demonstrate resilience despite recent economic and climate-related shocks. They remain reliant on tourism, agriculture, and infrastructure development. While recovery is underway, risks such as high public debt, external price shocks, and climate-related events continue to pose challenges to sustainable growth.

Dominica's economy grew by an estimated 4.6% in 2024, supported by a rebound in tourism, public infrastructure investments, and strong Citizenship by Investment (CBI) revenues. Tourism arrivals have exceeded pre-pandemic levels, and ongoing projects include a new international airport and geothermal energy development. However, food insecurity remains a concern, with 21% of survey respondents reporting going a whole day without food in the previous month. Inflation eased to 2.3% in 2024 and is expected to decline further to 2.2% in 2025. Public debt decreased slightly to 103% of GDP, and the fiscal deficit narrowed to 3.1%, with projections pointing to a further drop to 2.1% by 2027. However, Dominica remains vulnerable to volatile CBI revenues, weather events, and global price fluctuations and growth is forecasted at 4.3% for 2025.

Grenada maintained strong growth in 2024 at 3.7%, despite damage caused by Hurricane Beryl, which affected about 10% of its tourism accommodations. Growth was supported by tourism and construction, while inflation dropped to 1.1%, helped by lower import prices. Public debt fell to 73.3% of GDP, and a fiscal surplus of 4.7% of GDP was achieved due to strong CBI inflows and solid economic performance. Poverty is estimated to have declined to 12.6% in 2025, below pre-pandemic levels. Looking forward, growth is projected at 3.8% in 2025, supported by reconstruction and tourism, although the current account deficit will remain elevated due to reconstruction imports.

Saint Lucia's economy grew by an estimated 3.7% in 2024, driven by tourism recovery and increased construction activity. Stayover arrivals increased by 18% in early 2024 compared to the same period in 2023, helped by hosting the Cricket World Cup. Inflation dropped significantly to 1.3%, and unemployment fell to 11.3% by mid-2024. The current account deficit narrowed to 1.3% of GDP, supported by strong foreign direct investment. Public debt stabilized at around 73.9% of GDP in 2024. Growth is expected to moderate to 2.8% in 2025, with continued investment in hotels and infrastructure. However, agriculture is expected to slow due to adverse weather, and risks include delays in fiscal consolidation and global economic shocks.

Saint Vincent and the Grenadines’ economy was affected by Hurricane Beryl in 2024, slowing GDP growth to 4.5%, down from 5.8% in 2023. However, tourism, agriculture, and infrastructure development continue to drive activity. Inflation eased to 3.5%, and growth is projected to rebound to 4.9% in 2025. The fiscal deficit widened significantly to 12.9% of GDP in 2024, largely due to hurricane-related spending, though this is expected to decrease over the forecast period. Public debt rose to 91.1% of GDP, with reconstruction driving capital expenditures. New infrastructure projects, including a port, airport, hotels, and the Sandals Resort, are expected to support economic diversification. The current account deficit widened to 20.1% of GDP in 2024, financed mainly through foreign direct investment and external borrowing.

The World Bank’s strategy for the Eastern Caribbean (2022–2025) continues to focus on supporting resilient and inclusive development. This strategy helps OECS member states recover from the pandemic, respond to environmental and disaster risks, and promote sustainable economic growth through three key pillars:

Enhancing Resilience to Natural Disasters: The strategy prioritizes infrastructure resilient to natural disasters, such as roads, ports, and energy projects, especially in countries highly exposed to these events like Dominica and Saint Vincent and the Grenadines. These investments aim to improve disaster preparedness and reduce long-term risks.

Boosting Human Capital: Investments in health, education, and social protection are focused on vulnerable populations. In Dominica, where food insecurity has worsened among young people and rural residents, this support is especially critical. The strategy emphasizes improving access to essential services and strengthening support programs for vulnerable families.

Driving Economic Growth: The strategy promotes a business-friendly environment through structural reforms, support for entrepreneurship, and digital transformation. It also supports alternative energy and tourism development, key to economic diversification in places like Saint Lucia and Grenada. By expanding geothermal and solar energy projects, Eastern Caribbean countries aim to diversify energy sources and reduce energy costs.

This regional strategy promotes practical cooperation among OECS countries, recognizing shared vulnerabilities and promoting joint efforts to achieve inclusive and sustainable development goals.

People

As part of the  OECS Regional Health Project:

●       Laboratory testing capacity has been enhanced through lab accreditations, procurement of equipment, training and improved information systems.  

●      Countries have also boosted their emergency operations center (EOC) capacities, procedures, and plans. 

●      Further, Grenada has improved event-based surveillance and established a designated laboratory equipped with COVID-19 diagnostic resources. 

●      Training of health workers on Field Epidemiology Training Program (FETP) has also been conducted under the Project.  

Under the World Bank-financed Saint Lucia Health System Strengthening Project

●      Saint Lucia has implemented its Performance-Based Financing in Health Facilities across the island as part of Universal Health Coverage

●      Successfully launched the of Maternal and Child Health Services under Phase 1 of  Universal Health Coverage

 Planet

The Bank supports fiscal responsibility frameworks and improve State-Owned Enterprises' performance. Funding initiatives like the Unleashing the Blue Economy of the Caribbean Project and the PROBLUE Multi Donor Trust Fund further bolster sustainable resource management and economic recovery efforts in the region.

 Prosperity

Micro, Small and Medium-Sized Enterprise Guarantee Facility Project

●      84 MSME loans (34 for women or women co-owned businesses) worth $4.3million have been granted to a variety of sectors in six Eastern Caribbean countries.

 Infrastructure

The Dominica Housing Recovery Project is part of Dominica’s rebuilding efforts in the aftermath of Hurricane Maria, a category 5 hurricane which severely damaged the island in September 2017. To date, the project has practically completed 230 houses, following damage or destruction by the hurricane. 

●      Further, in response to the COVID-19 pandemic, the The Dominica Housing Recovery Project included two Contingent Emergency Response Component programs. The first provided income support to about 6,167 beneficiaries affected by the pandemic. The second provided reimbursable financial assistance to over 660 small businesses. Both programs have been successfully closed.

●      More than 4,000 households - with over 62% of them led by women in St Vincent and the Grenadines - received short-term income support to aid in recovery from the effects of the volcanic eruption and climate-related events through the Volcanic Eruption Emergency Project

Digital

As part of the Caribbean Digital Transformation Project  (Digital Caribbean) since 2020:

● 81% of Dominicans now have access to the internet, up from 74%

● 78% of Grenadians now have access to the internet, up from less than 70%

● 79% of Saint Lucians and 85% of citizens in St. Vincent and the Grenadines now have internet access.