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Montserrat

Quick Facts

Population:	4,500
Land area:	102 square Km
Capital:	Brades (Functional capital)
Language(s):	English
Local Currency:	East Caribbean dollar (XCD)
Exchange:	US$1.00 = EC$2.70
UNDP Human Development Rank:	Not ranked
Life Expectancy:
Adult Literacy rate:
Official Government website:	http://www.gov.ms/

Government

Chief Minister - Dr. Lowell Lewis

Minister of Tourism - Dr. Lowell Lewis

Public Holidays: New Year's Day (01 January); St. Patrick's Day (17 March); Good Friday; Easter Monday; Labour Day (04 May); Whit Monday; August Monday, Christmas Day (25 December); Boxing Day (26 December); Festival Day (31 December)

Economic Development

Economic Survey of the Caribbean 2007-2008

According to the survey the economies of the ECCU continued to show positive growth for the sixth consecutive year. In 2007, preliminary data indicated that growth slowed to 5.2% from 6.3% in 2006 as many public and private construction activities geared towards the CWC were completed. In addition there was a significant contraction in the tourism sector, which actually declined by 0.6% in 2007 compared to 6% in 2006. Fuelled by hikes in oil and food prices, especially in the last quarter of 2007, the rate of inflation increased to 6.1% from 1.3% in 2006 and is expected to continue on an upward trend in 2008. Economic growth will continue to slow but remain positive in 2008, projected at 3.8%, mainly influenced by the slowdown in the United States economy and rising international oil, food and other commodity prices.

In 2007 growth was strongest in Anguilla (21%), St Vincent and the Grenadines (6.9%) and Antigua and Barbuda (6.9%) while Hurricane Dean, which struck in August 2007, negatively impacted on the growth rates of Saint Lucia (1.7% compared to 4.9% in 2006) and Dominica (1.8% compared to 3.8% in 2006). Despite the challenge of continuous volcanic activity in Montserrat, the economy grew by 2.8% compared to negative growth of 3.8% in 2006. Intermediate growth of 3% was recorded in both St Kitts and Nevis while growth in Grenada was 4.4%. The main impetus of growth continued to be the construction sector with spill over effects into mining and quarrying, transportation and communication,
electricity and water and banks and insurance. Construction activity will remain robust in 2008 driven by the private sector and the Public Sector Investment Programme (PSIP).

Economic Performance for 2006

Sourced from: The ECCB 2006 Economic Review

Since the destructive volcanic eruptions in the mid-1990’s, the small island of Montserrat found themselves on the brink of virtually being incapacitated to conduct any form of economic activity. Half of their population of 10,000-12,000 persons migrated to other territories. Nevertheless, the current population (estimated at 5000 people) appears to be ‘weathering the storm’ in some aspects; agriculture production has increased in the first half of the year, where there was a threefold increase in crops harvested. A decent control of import payments caused a narrowing of the trade deficit, but most of all, precise fiscal management of government operations (one of the mainstay contributors to the GDP) shifted the fiscal deficit from $12.4m in the first half of 2005 to a surplus of $0.6m in 2006.

The Threats of Nature

The economy of Montserrat must still maintain caution due to the unpredictable element of another volcanic eruption. The great Adam Smith, leader of the school of classical economists, stated that subsequent to the correct operations of a market system then economic development can take place. A good market system must encompass a high demands, and a responsive supply system to meet people’s demands, and this is a great part of what hinders on the progression for the island of Montserrat. Tourists demand for the country has been slowly declining, and there is a fragile quality of the agricultural sector as a result of pending environmental conditions (e.g. volcanic ashes).

The overview of 2006 economic performance is marginally sufficient, increased construction and fiscal operations is commendable, however, the points mentioned above are essential in taking the proper initiative. Having a ‘tourist thriving’ island’s GDP mostly contributed by construction and government operations is not enough, and currently a sustainable development plan is being conducted, where the Strategic Objectives are:

Strategic Objectives for 2007

To promote the retention of the present population and encourage the return of Montserratians from overseas.
To promote prudent economic management, sustained growth, a diversified economy and the generation of employment opportunities
To promote human development and well-being and enhance the quality of life for all people on island
To ensure good governance by strengthening public administration and promoting civil society.
To improve and expand external relationships to facilitate Montserrat's integration into the regional and global environment.
To ensure that Montserrat's development is environmentally sustainable and includes appropriate strategies for disaster mitigation.

Social Development

MONTSERRAT’S TOURISM SECTOR OPEN FOR BUSINESS FOLLOWING WEEKEND VOLCANIC DOME COLLAPSE

May 22, 2006
Montserrat is open for tourism business following the collapse of the lava dome at the Soufriere Hills Volcano on Saturday May 20th, 2006. The Montserrat Volcano Observatory (MVO) confirmed that the lava dome collapsed over a three (3) hour period on Saturday leading to mud flows around the volcano and surges along the north-east flank. Following a helicopter flight the MVO reported that nearly all the dome is gone and currently there is low level activity with ash venting taking place on the west side of the crater. There were no casualties or injuries reported from the incident and the population remains safe.
Source:Government Information Unit

Education

Environment

Solid Waste Management

Health

Legislation

Statistics

Selected statistics indicators for MONTSERRAT
UN Statistics Division for MONTSERRAT
Caribbean Social Statistics Database
Caribbean Trade Statistical Database

More Information

Key Documents

Up one level

The OECS Deepening and Strengthening Integration Through an Economic Union: Frequently Asked Questions (FAQs)
Economic Survey of Latin America and the Caribbean 2007-2008
The Eastern Caribbean Central Bank 'Economic and Financial Review' March 2008
Toward a Caribbean Vision 2020: A Regional Perspective on Development Challenges, Opportunities and Strategies for
BUDGET STATEMENT Investing in a people-centered agenda. Presented by Montserrat Chief Minister
CTO. Latest Tourism Statistics for the Caribbean 2008
Review Of Cariforum-EU EPA – Implications For The British And Dutch Caribbean Octs: LC/CAR/L.176
REVIEW OF CARIFORUM-EU EPA – IMPLICATIONS FOR THE BRITISH AND DUTCH CARIBBEAN OCTs
Towards a Single Economy and a Single Development Vision
CARIBBEAN CONNECT: A HIGH LEVEL SYMPOSIUM ON THE CARICOM SINGLE MARKET 28 - 30 June, 2006, Sherbourne Conference Centre, Two Mile Hill, St. Michael, BarbadosND ECONOMY.
Trade Integration in the Americas
Overview of CARICOM's Trade with Canada
Background to Negotiations on CARICOM Canada Trading Arrangements

Bibliography