- published: 23 Oct 2014
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Grenada has a largely tourism-based, small, open economy. Over the past two decades, the economy has shifted from one of agriculture-dominant into that of services-dominant, with tourism serving as the leading foreign currency earning sector. The country's principal export crops are the spices nutmeg and mace (Grenada is the world’s second largest producer of nutmeg after Indonesia). Other crops for export include cocoa, citrus fruits, bananas, cloves, and cinnamon. Manufacturing industries in Grenada operate mostly on a small scale, including production of beverages and other foodstuffs, textiles, and the assembly of electronic components for export.
Economic growth picked up in the late 1990s following slow growth and domestic fiscal adjustment in early years of the decade. Despite an expansionary fiscal policy, the public debt remained moderate at around 50 percent of GDP as deficits were financed partly by privatization receipts. Since 2001, economic growth declined caused by adverse shocks such as a slowdown in the global economy and natural disasters. To deal with the shocks, fiscal policy became more expansionary while privatization receipts declined. As a result, public debt increased sharply to near 110 percent of GDP in 2003. Economic conditions worsened when Hurricane Ivan hit the country in September 2004; progress in fiscal consolidation was impeded as government revenues fell and policy priority was shifted to post-hurricane relief.
Grenada (i/ɡrɨˈneɪdə/) is an island country and Commonwealth realm consisting of the island of Grenada and six smaller islands at the southern end of the Grenadines in the southeastern Caribbean Sea. Grenada is located northwest of Trinidad and Tobago, northeast of Venezuela, and southwest of Saint Vincent and the Grenadines.
Grenada is also known as the "Island of Spice" because of the production of nutmeg and mace crops of which Grenada is one of the world's largest exporters. Its size is 344 square kilometres (133 sq mi), with an estimated population of 110,000. Its capital is St. George's. The national bird of Grenada is the critically endangered Grenada Dove.
Grenada was first sighted by Europeans in 1498 during the third voyage of Christopher Columbus to the new world. At the time the indigenous Island Caribs (Kalinago) who lived there called it Camahogne. The Spaniards did not permanently settle on Camahogne. The English failed in their attempt at settlement in 1609.