Poverty in Grenada
Although commonly recognized as a vacation destination, Grenada is a country suffering from poverty in its rural regions. Poverty in Grenada has been a struggle for decades due to the island’s small size, vulnerability to natural disasters and lack of skilled laborers within its rural population.

According to the World Bank, 32% of Grenada’s 107,000 people are considered poor, and 13% are considered extremely poor.

Poverty in Grenada is most visible in rural areas because small, rural communities don’t have access to Grenada’s mainstream economy, which relies heavily on international trade for growth. In rural areas, farming is the most common profession, especially among older individuals. The average age among farmers is 54 for women and 48 for men.

Workers in the agriculture industry are greatly impacted by tropical storms and hurricanes. When storms hit, agriculture-based businesses such as farms and fisheries may suffer severe damages. This vulnerability makes it nearly impossible for agricultural workers to overcome poverty.

Increasing numbers of Grenada’s youth are staying away from the agriculture industry because of its perceived instability. Within Grenadian agricultural industries, wages are so low that “workers can do hardly more than survive,” according to a Grenada Growth and Poverty Reduction Strategy document.

While Grenada’s younger populations generally prefer careers in the successful tourism industry, many lack the professional skills they need. Many young people find it difficult to enter an industry other than farming because of illiteracy or lack of access to education.

Unemployment is a major factor contributing to ongoing rural poverty in Grenada. The country has one of the highest unemployment rates in the Caribbean.

According to the Rural Poverty Portal, the unemployment rate decreased from 24.4 % in 2008 to about 15%. Since the global financial crisis in 2008, several steps have been taken to alleviate poverty in Grenada.


International Aid Fighting Poverty in Grenada


In 2011, the U.N. rural development agency signed an agreement to “co-finance a $7.5 million project” to aid 12,000 impoverished people in Grenada.

As part of the agreement, the U.N. International Fund for Agricultural Development loaned $3 million to the six-year Market Access and Rural Enterprise Development Programme. U.N. contributions have created jobs, improved market access and supported rural micro-enterprise projects in 50 Grenadian communities.

In November 2015, the World Bank approved a $15 million loan to aid Grenada. The loan will be used to improve natural disaster resilience, public resource management, the banking sector and private investment sustainability. Stronger ties between tourism and agriculture will also be established in order to distribute more wealth to rural areas.

At the 46th Annual Caribbean Development Bank (CDB) board of governors meeting in May 2016, Grenadian Prime Minister Dr. Keith Mitchell praised the CDB for providing major financial assistance over the last decade in support of social and financial programs.

Looking to the future, Mitchell stated that progress can continue to be made with the CDB’s help to alleviate rural poverty in Grenada as well as in every Caribbean nation.

Alex Fidler

Photo: Flickr


Grenada, a small Caribbean island with a population of 105,000, just might be changing the world. The nation is negotiating an unprecedented debt-relief program with its creditors around the world, and their decisions could define a new standard of debt-freedom for billions of people.

Small Economy, Big Problems

After a socialist coup and U.S. invasion in the 1980’s, the island nation has struggled to sustain itself. Revenue from its current biggest export, nutmeg, hardly matches its economic struggles. A US-EU banana trade war in the 90’s eliminated its biggest source of income, hurricanes Ivan and Emily ravaged its homes and infrastructure in 2004 and 2005, and tourism has plummeted since the 2008 recession. Unemployment has reached 30%, and there is no end in sight.

To prop up its deteriorating economy, Grenada has borrowed substantial sums from private bondholders, governments, and multilateral institutions like the World Bank and International Monetary Fund. Unfortunately, the assistance failed to properly kickstart the economy, and now those creditors are calling in their debts—debts that almost exceed Grenada’s gross national income. Last March, Grenada defaulted on most of its payments, and more are due this month. But a new Grenadian organization is rethinking the nation’s approach.

The Jubilee

Grenada’s Conference of Churches (CCG) is calling for a “Jubilee”—a radical reduction of Grenada’s 1 billion dollar debt. Inspired by the biblical concept of debt forgiveness in Leviticus 25, the CCG is recommending a debt restructuring based on the World Bank’s Heavily Indebted Poor Countries Initiative, independent mediation by sympathetic nations like Norway and Germany, and budget readjustment so that debt relief funds economic development in-country.

“While the obligation to repay loans must be acknowledged,” their statement reads, “the governments of small nations are not helpless at the mercy of their creditors.” The CCG’s response has invigorated Jubilee advocacy networks across the globe, and international support for their cause is growing. Other Caribbean countries have negotiated debt restructures, such as Belize’s 10-20% debt reduction earlier this year, but Grenada’s look to be the precedent for radical debt reform. Their negotiations have implications for billions of people living in indebted countries throughout the developing world.

Whatever happens, Grenada’s creditors are looking at inevitable losses. “They may initially take a tough line, but Grenada always has the option simply to sit it out,” an anonymous source said, “Recovery through litigation is unlikely to be a serious proposition for bondholders.”

– John Mahon

Source: The Guardian, Financial Times, Now Grenada
Photo: Marsh Analytics