Saint Vincent and the Grenadines is the largest of the islands which form the Grenadines chain, a string of small islands stretching southwards from Saint Vincent for about 130 kilometres towards Grenada. Its total population is 109,000.
The Vincentian economy has traditionally depended on agriculture, primarily bananas. Due to some structural weaknesses as well as to the erosion of preference on the EC market, production of bananas has dropped in the last two decades and the country has had to cope with the severe economic and social consequences of the banana decline. Banana export earnings fell from nearly € 31 M in 1990 to less than € 6 M in 2006. Also through the Special Framework of Assistance for traditional ACP banana suppliers, the country has been trying to diversify the national agricultural production while concentrating its banana production in the Fair Trade niche market. Unemployment, especially among women and the youth, is a serious problem. Although social indicators are good, illegal drug production (marijuana cultivation) and substance abuse have negative social implications. The Government has drafted a Medium Term Economic Strategy Paper, laying out its policy agenda, goals and objectives, economic prospects and strategy and the financing requirements necessary to achieve sustained growth and reduce poverty. The Government’s economic approach include maintenance of macro-economic fundamentals; placement of social equity at the centre of consideration; pursuance of balanced growth to reduce inequality and create long-term employment; and rebalancing of the state-market relationship for the private sector to assume a more pivotal role. The current economic crisis is affecting all countries in the region and threatening to reverse hard earned gains in human development. In the face of lower tourist arrivals, less remittances and stagnating revenues, governments are being called upon to expand safety nets to cushion the effects of the crisis on the poor and the most vulnerable.
Under the 10th EDF, it is proposed to focus 80% of the financial envelope, corresponding to € 6.24 M, on Modernisation of the Public Service in the Health Sector, with special attention to Health Sector Reform. The intervention is aimed at enhancing accountability, transparency and responsiveness of ministries and departments; measuring performance and encouraging change management, manpower planning, and training. The remaining amount (€ 1.56 M) will be equally divided between Technical Cooperation Facilityand Technical Assistance.
Saint Vincent is a member of CARIFORUM, CARICOM and the Organisation of Eastern Caribbean States (OECS), the latter having established a single monetary area and a common currency (the Eastern Caribbean Dollar) as well as a common central bank (the Eastern Caribbean Central Bank). On 29 December 2009, the OECS Leaders met in Saint Kitts and Nevis and, 28 years after the original treaty of Basseterre creating the OECS, signed a new Treaty establishing an Economic Union among them. The Treaty will have to be ratified and all institutional arrangements are not expected to be in place before mid 2010. Together with all other OECS members, Saint Vincent also committed to the CARICOM Single Market and Economy (CSME), the regional pact allowing for the free movement of goods, skills, and labours, across participating countries. In June 2009 Saint Vincent and the Grenadines joined ALBA, the regional initiative promoted by Venezuela. Saint Vincent is also a member of Petrocaribe, a Caribbean oil alliance being promoted by Venezuela.