St. Lucia

The economy of Saint Lucia is in transition, mainly as a result of the changing global environment, and the dramatic impacts these changes had on banana export earnings, tourism and manufacturing, from which St. Lucia primarily earns its foreign exchange, with a smaller contribution from manufacturing. Goods and services are the main contributors to St. Lucia's GDP.

Over the past decade there has been a drastic decline in exports, while provision of services has experienced substantial increase. Note must also be taken of the strong volatility of St. Lucia's economy, clearly indicating a need for stabilization. The agricultural sector has contracted considerably, with a particularly dramatic decline in the banana industry. Moreover, in common with the region, tourism has experienced a sharp decline as a result of global economic downturn and September 11th. Similarly, despite significant development in the industrial and manufacturing sectors over the past three decades, the sector has more recently been struggling with decline, primarily due to uncompetitive costs and quality of locally manufactured goods.

As a result of the general economic downturn, the fiscal performance of the country has weakened substantially over recent years and the country has turned to international financial services to generate additional fiscal revenue.

These macro-economic difficulties are reflected in an increase in unemployment and changes in the composition of the work force. Even so, there has been a substantial increase in the standard of living.

Poverty is becoming an increasing problem among the younger generation and the effects on children are a particularly huge concern, since their lack of education, poor health, etc. will contribute to the vicious cycle of increasing poverty in future generations. At the same time the number of older persons living in poverty is growing and, as the evidence shows, women are also more often victims of poverty.

St. Lucia's economic trend calls for immediate action. The government of St. Lucia is aware of the challenges imposed by the current processes of globalization and the resulting marginalization of Small Island developing states. It has thus established a number of policy programmes and measures aimed at mitigating the impact of poverty on households and communities, at enhancing economic and social opportunities for poor people, and at removing the root causes of social disintegration and exclusion, economic deprivation, and cultural alienation.

These policies are to be complemented through the Interim Poverty Reduction Strategy and Action Plan (IPRSAP) which seeks to provide the country's first comprehensive framework for concerted action towards poverty reduction. It also aims at providing the basis for formulation of broader policy framework for social development.

The Poverty Reduction Strategy (PRS) in St. Lucia is thus to encompass the following goals, using the internationally accepted Millennium Development Goals (MDG) as general guides and basis:

• Provision of sustainable economic opportunities, at both the macro and micro levels
• Empowerment of people and communities, and inclusion of the concerns of the poor people
• Promotion of universal access to health, education, water and sanitation, and the protection of vulnerable individuals and groups

To achieve these objectives, six strategic goals will be pursued in conjunction with each other:

• Provide an enabling policy environment
• Promote sustainable economic growth
• Sustain and develop livelihoods and production capacity as well as employment and revenue generation opportunities
• Promote human and social integration, remove social barriers and build social institutions
• Guarantee, secure and improve access by the poor/vulnerable to basic services
• Build capacity and increase effectiveness and efficiency, improve governance

By addressing these issues of crucial concern to eradicating poverty in St. Lucia, the problem areas will be directly addressed through country tailored strategies, promising the most effective and sustainable means to poverty alleviation.