Barbados Country Statistics

Barbados is situated 100 km (62 mi) east of the Windward Islands and the Caribbean Sea; therein, it is about 168 km (104 mi) east of the islands of St. Vincent and the Grenadines and 400 km (250 mi) north-east of Trinidad and Tobago.

Barbados is one of the earliest English colonies in the Caribbean, settled in the early 1600’s,it retains a rich cultural heritage which has earned it the reputation of being described as “little England”. One of the most picturesque islands in the Caribbean, its well maintained architectural history and natural beauty makes it one of the most renowned vacation destinations in the world. In 2011, historic Bridgetown and its Garrison was designated a World Heritage Site by UNESCO.

Given its natural attractions, the island’s economy has become heavily reliant on tourism. According to the “World Trade & Travel Tourism Report 2014”, tourism directly accounts for 10.9 percent of the island’s GDP and indirectly contributes to 36.2 percent of GDP. Furthermore, the sector employs some 11.1 percent of the labour force. Apart from tourism, Barbados is emerging as an international business centre, on the basis of its reputation for sound regulation, good infrastructure and compliance with international standards. The number of operating international business and financial services companies in September 2014 stood at 3,904.

Following the global financial crisis of 2008, the Barbadian economy was adversely affected by declining economic activity in its main source markets: England, USA and the Euro-zone area. GDP declined by 4.1 percent in 2009 and since then the economy has experienced sluggish growth of less than 1 percent up to 2013.

Government’s fiscal accounts are constrained by high debt and continuous fiscal deficit. At the end of the fiscal year 2013, the deficit reached 8.8 percent of GDP. The Central Bank also revealed that public debt stood at 107 percent of GDP in 2013. Consequently, the country has adopted tight policy measures to help return its fiscal accounts to a sustainable path. This has helped slow the rate of growth in its public debt.

The year 2014 was indeed another challenging one for Barbados. Latest official data released by the Central Bank reveal that economic activity remained stagnant during the first six months of 2014. The non-tradable sector remained flat, while the tradable sector fell marginally by 0.3 percent. However, signs of a turnaround are emerging, as tourism recorded a modest gain during the period and as the world economy recovers, Barbados’ fortunes are also likely to return. Inflationary pressures have also been subdued at 1.7 percent and are projected to remain low for the near term.

Looking ahead, economic activity is expected to improve over the long-term, as tight fiscal measures adopted by the country begin to bear fruit. As the world economy improves, revenue streams are likely to see marginal recovery in 2015 and the decision to reduce the Air Passenger Duty by the UK government, should aid in attracting more visitors from Barbados’ main source market. International reserves are also estimated to grow on the back of increased investments being made in the island’s tourism infrastructure. These include: the first phase of the Port Ferdinand Marina to accommodate cruise ships, Almond Beach resort, Bushy Park - a motor racing circuit, the Apes Hill Clubhouse and the Central Bank museum. Against this backdrop, the IMF predicts that the economy will register growth of approximately 0.5 percent in 2015.