Dominica

Dominica's economy grew by 3.1 percent in 2025, driven by infrastructure investment and tourism. Construction activity was underpinned by major public projects, including climate-resilient infrastructure, an international airport, and a geothermal plant, as well as private developments such as the Ariel Tram/Cable Car and new luxury hotels. These expansions boosted tourism capacity, with stayover arrivals up 13.7 percent in the first three quarters of 2025 relative to the same period from the previous year. Agriculture, the largest source of employment for Dominica's poorest workers, slowed but remained supported by government initiatives.

Inflation eased to 2.6 percent in 2025, helped by lower global commodity prices, with food price inflation standing at 3.1 percent in September 2025. Inflation is expected to remain at 2.6 percent in 2026 due to higher oil prices linked to the conflict in the Middle East, before declining to 2.1 percent over the medium term. Public debt declined to 99.5 percent of GDP and is projected to fall gradually to 91.3 percent by 2028.

Growth is projected to converge to 2.8 percent by 2028 as major infrastructure projects conclude, with tourism, agriculture, and the transition to geothermal energy continuing to support expansion. The outlook is subject to downside risks including volatile Citizenship-by-Investment revenues, fluctuating food and fuel prices, natural disasters, and global trade disruptions.

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Through the Dominica Housing Recovery Project, the Bank  supported the construction of climate-resilient homes for households affected by Hurricane Maria, alongside targeted income support for vulnerable families.

Dominica is also supported through a World Bank Disaster Risk Management Development Policy Credit with a Catastrophe Deferred Drawdown Option (Cat DDO), which provides rapid access to financing following disasters while promoting reforms to strengthen preparedness and fiscal resilience.

The World Bank is supporting Dominica’s transition to clean and resilient energy through investments in geothermal development, helping reduce reliance on imported fuels and strengthen energy security.

Dominica benefits from regional initiatives, including strengthened laboratory testing capacity, improved emergency operations, and health worker training under the OECS Regional Health Project. Through the Caribbean Digital Transformation Project, the country is strengthening digital connectivity and digital public services. Broader regional efforts, such as the Unleashing the Blue Economy of the Caribbean Project and the MSME Guarantee Facility, support livelihoods, enhance private sector resilience, and promote sustainable management of natural resources. The OECS Country Climate and Development Report (CCDR) provides climate-resilient development diagnostics and priority actions relevant for Dominica and other Eastern Caribbean states.

*Last Updated: March 16, 2026

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The World Bank Group engages in Dominica through the OECS Regional Partnership Framework, a joint strategy that supports green, resilient, and inclusive development. The program targets three outcomes: (i) strengthened resilience to climate change and other shocks—through disaster risk management, climate-smart infrastructure, and stronger macro-fiscal frameworks; (ii) improved human capital and social inclusion—via better health systems, skills, and social protection; and (iii) more and better jobs—by improving the business environment and expanding digital and physical connectivity.

Delivery combines regional operations with country-specific support, including a Disaster Risk Management Development Policy Credit with Catastrophe Deferred Drawdown Option approved in 2022 to provide rapid liquidity after disasters, and a 2025 development policy credit to bolster domestic revenue, financial-sector resilience, biodiversity conservation, and disaster preparedness. Together, these engagements help Dominica reduce vulnerability, safeguard livelihoods, and enable sustainable, private sector–led growth.

It aligns with national flagship programs such as the National Rural Livelihoods Mission and initiatives for universal electrification, housing, and financial inclusion. The CPF emphasizes skills development and connectivity to boost competitiveness, with a vision of achieving a $7.5 trillion GDP and reducing poverty to 5% by FY31. Urbanization is addressed through infrastructure and service delivery improvements, while rural transformation is supported via agrifood systems modernization, digital access, and inclusive economic participation, especially for women and youth

The new CPF, currently under development, is designed to align with India’s ambitions for 2047 and the strategic direction set by the federal government’s recent budgets. It will introduce a forward-looking and outcome-oriented, joint public and private sector-led approach to investing in skills, health and education of people, infrastructure and innovation, urban development that facilitates cities as engines of growth, and rural prosperity, resilience and climate adaptation.  The new CPF will also emphasize the “Budget Plus” and “Finance Plus” models to build partnerships with other development institutions and leverage public and private capital and global knowledge for transformative impact.

*Last Updated: November 10, 2025

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