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Since independence, Barbados has transformed itself from a low-income economy dependent upon sugar production into an upper-middle-income economy based on tourism. Barbados is now one of the most prosperous countries in the western hemisphere outside of the U.S. and Canada. The economy went into a deep recession in 1990 after 3 years of steady decline brought on by fundamental macroeconomic imbalances. After a painful readjustment process, the economy began to grow again in 1993. Growth rates averaged between 3%-5% since then until 2001, when the economy contracted 2.8% in the wake of the September 11 terrorist attacks and the global drop-off in tourism. Growth picked up again in 2003, and the economy grew by 3.4% in 2004. Tourism drives the economy in Barbados, but offshore banking and financial services have become an increasingly important source of foreign exchange and economic growth. The sugar industry, once dominant, now makes up less than 1% of GDP and only employs around 800 people. The labor force totaled 146,300 persons at the end of 2004, with a near-historic low unemployment rate of 9.8%. Barbados will host several games and the final of the Cricket World Cup in 2007, and much of the country's investment is directed toward accommodating the expected influx of visitors. The government and private sector are both working to prepare the country for the CARICOM Single Market and Economy (CSME)--a European Union-style single market scheduled to begin in January 2006. |
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