Cover Image
close this bookThe Courier N 148 - Nov - Dec 1994 - Dossier: Education - Country Reports: Saint Lucia - St Vincent and The Grenadines (EC Courier, 1994, 104 p.)
close this folderCountry report
close this folderSaint Lucia: Weathering the economic storm
View the document(introduction...)
View the documentPrime Minister John Compton explains how St Lucia must bend to the winds of change
View the documentEU-St Lucia cooperation by Philippe Darmuzey*

(introduction...)

There is no doubt about it. Saint Lucia's ship of state is riding rough seas. The hitherto dominant crop, bananas, has been suffering strong 'adverse winds'. First of all, there was what is commonly known here as '404/93', the EU's much-debated new banana market regulation, which came into force - after a- long period of uncertainty among growers - on 1 July 1993. Perhaps even more strongly felt was the big drop in the value of the pound sterling, the currency in which Saint Lucia's 'green gold' is paid for. Compounded, these 'adverse winds' led to heavy turbulence, with a banana growers' strike in October 1993, riots - and two deaths. This year, as one of the worst droughts for years has hit production, a new contract with the formerly exclusive banana marketer. Geest. needs to be agreed - and this in a more tense and uncertain climate then ever known before in 40 years of banana partnership. Fortunately tourism has offset some of the banana sector's setbacks, becoming the top foreign-exchange earner. Yet here, too, there is an ongoing debate, not just about certain sectoral aspects such as taxes on cruise ships or the fast rising predominance of the so called 'ale inclusive' type of accommodation, but over the sector's real contribution to the wider economy: the banana dollar, unlike any other, trickles down throughout society. While there is no real alternative for bananas, a new course is definitely being set bound for agricultural diversification, with a view also to boosting linkages with tourism. At the same time, the new international banana scene calls for a major quality/productivity drive, weeding out inefficient growers and aiming to make Saint Lucia a cost-effective producer up to and beyond the turn of the century.

The seas off Saint Lucia's coasts are seemingly rougher too, as major economic blocs are forming all around. Small island states such as the Windwards, to which Saint Lucia belongs, increasingly share a feeling of being 'marginalised'. Since the end of the Cold War, they feel to be of little strategic or political importance, even less so in an economic sense, given the small size of their markets. Usually a strong and resilient economy, enjoying democratic political stability and good governance, Saint Lucia seems likely nevertheless to weather the storm and to set out on a new and challenging course. If its high per capita concentration of Nobel prizes - Sir Arthur Lewis in economics and L)erek Walcott in literature - is anything to go by, any failure in adjusting to new, less-protected realities will not be attributable to a lack of human capacity. In any case, there is no alternative. For, as the 'ship's captain', Prime Minister John Compton, observes, 'there can be no taking to the boats!'

'Simply beautiful'

In all its simplicity, Saint Lucia's current tourism promotion slogan may be too much of an understatement to describe this 'green paradise of the Caribbean'. The natural beauty of the 616 square kilometre island (roughly 43 km long and 22 km wide) makes it the envy of many nations less favourably blessed by nature. Part of the Lesser Antilles or Windwards, and therefore Iying in the hurricane belt, the territory is volcanic in origin. The rugged interior displays a variety of fertile valleys indented by rainforest-covered mountains rising to 1200 metres high. Most famous of all are the twin Pitons, a couple of 800m-high extinct volcano chimneys, descending steeply into the Caribbean sea, where underwater too they offer first-class scenic sights to scuba divers. The island is also endowed with some beautiful white sand beaches - a major tourist asset that not all islands in this area can boast.

Both fertile and attractive, the island has, throughout its history, been the focus of many a sea-faring nation. It was first settled by Arawac Indians originating from the Amazon basin, but by the 13th century more belligerent Carib Indians had taken control. There may still be room for discussion as to whether Columbus was really the first European to spot these islands, but it is nevertheless still claimed that the godfather of globetrotters named the island after Santa Lucia, having sighted it on her Saint's day (13 December) in 1502, during his fourth voyage of discovery. Like most of its Caribbean neighbours, the island was coveted by a range of European nations and many a battle was fought over its much disputed ownership. It changed hands most frequently between France and England, as is still very obvious today. Indeed, as one drives on the left throughout the island, the majority of place names are found to be French and, while English is the official language of the 140 000 inhabitants, they will usually communicate in Patois, a creole mixture of French, English and African languages fairly close to the one used in nearby Dominica. More than half of the population is younger than 15 years old, which poses the dual challenge of meeting the pressing needs for education and training as well as creating much needed job opportunities for several thousand school leavers every year, which if anything is even more difficult.

Politically speaking, Saint Lucia is a parliamentary democracy on the Westminster model. The last elections were held in April 1992 and confirmed the United Workers Party in power with 11 seats ( + 1) against the 6 seats (-1) of the opposition St Lucia Labour Party led by Julian Hunt. The Progressive Labour Party failed for the third consecutive time to win a seat. The UWP was led once more to victory by Prime Minister John Compton, who has been in power without interruption since 1982. In fact the PM belongs to that handful of Caribbean leaders who have been very prominent both in their country's and in their region's affairs over the past few decades. Indeed, the 68-year-old John Compton first came to power in the colonial days, initially as Chief Minister in 1964 and then as Premier. He held the top post continuously for 15 years, leading his country to independence in 1979. His UWP was ousted shortly after that but was in opposition for only three years. He led his party to victory again in 1982 and has held power ever since. Even at times of serious economic and consequently political crisis, such as during the banana strike of October 1993 - from which the Opposition obviously tried to benefit - his political skills have proved more than a match for his rivals, and he now seems more than ever set to steer his country back into calmer waters.

A juddering engine

In normal times, Saint Lucia has a strong, resilient economy, and even when things go 'bad' it is still relatively well off. It suffices to look at the figures. Between 1975 and 1992, Saint Lucia's real GDP growth rate averaged about 6%. Last year's growth of just 3.1 % may look poor in comparison but in fact, at a time of worldwide economic recession from which few nations escaped, such a performance was still more than commendable.

This year, in the view of Mrs Marcia Philbert-Jules, the Planning Ministry's Chief Economist, 'the expected banana shock is really taking its toll... and although the general mood is improving we are still feeling the pinch.' Indeed, the banana sector is still so predominant that, in the context of overall consumer patters, any decline in the sector there sends shockwaves through the island's economy.

At the risk of oversimplifying, the Saint Lucian economy could be compared to a turbo diesel engine upon which the whole country thrives. To complete this motoring image, bananas would be the basic fuel while tourism has really become the turbo. Without bananas the engine would stop; tourism provides that extra boost, particularly when bananas face hard times. But let there be no doubt about it. However powerful the turbo - and tourism has become the main foreign exchange earner - no Saint Lucian 'driver' will underestimate the role of the basic fuel, bananas. Yet at times the engine judders. Dirt in the fuel?

The image is obviously too simple, as it neglects a number of other economic sectors' contribution to growth, but it is nevertheless valid given the predominance of the banana-tourism tandem. Hence the concern to lessen dependence on it, primarily by pushing agricultural diversification.

The 'dirt' in the fuel has had a dual, interacting cause. First, there was the above-mentioned Regulation 404/93 which reorganised the EU banana market. It entered into force - at last - on 1 July 1993. One should stress the 'at last' because, for several years prior to that, so many battles were fought over it and so much uncertainty was cast over the future of the banana industry that thousands of farmers became overly concerned about their main source of income. And indeed, the new market rules did put producer prices under pressure. Second, and perhaps felt far more strongly and directly in the farmers' pockets, there was the steep depreciation of the pound sterling against the Eastern Caribbean dollar. Add to this shortages of fertilisers and other inputs, and a fairly dry season in the first half of 1993, and you end up with a cocktail of 'dirt' sufficient to make any mechanic worry over the extent of his engine's juddering, whether he can get it running properly again and, if so, how.

Banana 'split'?

Whereas bananas have always been part and parcel of St Lucians' diet, it was really only at the start of the 1950s that the banana trade started developing, thanks mainly to a 15-year contract with a UK company that was to buy all Windward bananas. Since then, bananas have rapidly become a key feature in determining not just the economic but also the social and political fate of Grenada, Dominica, Saint Vincent and the Grenadines, and Saint Lucia.

Saint Lucia is the biggest producer and exporter of the four Windwards, and it must be said that when the engine started juddering, even though the hiccoughs were as painfully felt by farmers in each island, it was here that they voiced their complaints most vociferously. Blaming their own Banana Growers Association, as well as the government and the common marketing agent Geest - the three main players on the banana scene - in August 1993, a number of unhappy farmers created the so-called Banana Salvation Committee, which called for a farmers' strike and for a halt to banana harvesting. Tempers quickly rose and things got out of hand. Riots in mid-October led to the deaths of two farmers.

All in all, the combination of developments both locally and internationally on the banana scene had major negative consequences for the entire nation. Banana production and exports both fell by about 11 %. Production slipped to 123 000 tons (down from 137 600 tons in 1992), of which 120 000 tons were exported (against 135000 tons the previous year). In terms of revenue, the catastrophe was felt even more strongly. Indeed, banana receipts, usually representing about half of total exports, fell by over 25%, down from EC$ 184 million in 1992 to a mere EC$ 137 million. There is a maxim that when 'bananas go, everything goes' but, unfortunately, the opposite is also true, as the banana dollar trickles down throughout Saint Lucian society. The wider economy felt the shockwaves to such an extent that the mere figures, however dramatic, do not reveal enough. Within the banana trade, after four rather prosperous decades, the core of the business itself was badly hit and the whole banana scene was, and still is, in uproar. The Government faced major political unrest as the opposition tried to capitalise on the banana crisis. The Banana Growers Association, like those in the other Windwards, was not up to the challenges posed by the crisis and got into dire financial straits. Finally, something had snapped in the long-standing love-hate relationship between the farmers and their hitherto exclusive marketing partner Geest.

To Geest or not to...

Agriculture Minister Ira d'Auvergne feels 'tine mood in the banana industry is gradually improving again and some of the gloom cast by years of uncertainty is being dissipated.' Securing guaranteed EU market access for 127 000 tons of bananas has certainly triggered a feeling of profound relief among the 800010 000 farmers concerned.

This is not surprising. Regulation 404/93 was the culmination of years of lobbying and fighting with Latin American banana-producing countries, their powerful backers among the US fruit multinationals,and a number of reluctant EU Member States. The battleground often shifted and included such arenas as GATT panels and even the European Court of Justice, but in the end Saint Lucia, together with other traditional ACP banana suppliers, was able to secure a quota. However, the new European banana scene, now far more open to competition and far more difficult to play, owing to a complicated system of marketing licences, poses a number of tough challenges for the Windwards. They are all high-cost producers with large numbers of small-scale farmers, growing fruit of excellent taste on hardly mechanisable lands, destined for a niche market of connoisseurs. Long-term survival as banana suppliers on competitive markets will require a major quality/ productivity boost in all the Windwards.

The year-long uncertainty has made nerves twitchy in the banana business, and not just among farmers. Most bodies and structures concerned here came under severe pressure and some have 'cracked'. Throughout the Windwards, the Banana Growers Associations have faced and still are undergoing in-depth reorganisation. At the regional level, the old banana lobby of WINBAN has been replaced, after a long period of preparation, by a proper commercial firm, the Windward Islands Banana Development Company (WIBDECO). Jointly owned by the Windwards Governments and their respective BGAs, it is now WIBDECO that negotiates a new Windwards banana marketing contract - only one instead of four (one with each separate island) as before, and perhaps not just with Geest.

The long-standing partnership of more than four decades has certainly been severely rocked. At the height of the banana crisis, many a reproach was voiced against Geest, which was presumed to be suffering less, was blamed for a certain 'arrogance' stemming from its exclusive historic marketing relationship and was accused of being a high-cost operator itself.

Whereas, prior to the crisis, Geest bought its fruit exclusively from the Windwards, the UK company decided a few years ago to look to additional sources for its fruit, and consequently bought a Costa Rican plantation. This move prompted a lot of suspicion among the Windwards and William Rapier, Chairman of Geest West Indies, readily admits that Geest 'did not do the proper PR on the diversification of our sourcing, which was only meant to allow us to keep growth in our market share.' Within the Windwards, the fears were understandable, as Geest now also had a foot in the dollar banana camp. The BGAs felt it was part and parcel of Geest's 'divide and rule' policy. The growers are also convinced that 'the money is really made in the shipping and marketing', and that 'Geest is an expensive operator in those fields'. Also, as Calixte George, Managing Director of the Saint Lucia Banana Growers Association, points out, 'it was generally felt among farmers that when the exchange value of the pound sterling dropped so steeply - down from EC$ 4.5 to a mere EC$ 3.87 at the time of the strike - Geest, who were trading the fruit in pounds sterling, should have made a gesture by applying a reasonable rate'. Geest's response to this is that it lost money in 1993, though some critics argue that this was not due to its banana operations.

In essence, the two sides, the Windwards and Geest, are positioning themselves for tough negotiations on a new five-year banana marketing contract - 'and not just exclusively with Geest,' BGA spokesmen will always stress. Going commercial themselves through the establishment of a WIBDECO branch in the UK - a move which has to be seen against the background of the new licensing system, where banana trading licences on the EU market have rapidly become very traceable items themselves - the Windwards feel the new competitiveness required cannot just come from their side. Cyril Matthews, Chairman of the interim board of the SLBGA, stressed that 'cost-effectiveness has to be achieved throughout all stages of the banana chain.' In fact, the Windwards have closely examined all the links of the chain and remain convinced that their shipping and merchandising can be operated more cheaply. Geest, through

While Geest accepts the fact that 'there is room for changes' to their side of the operation, they are also adamant that 'the land-based activities need some thorough overhauling too.' Its spokesmen go out of their way to insist on the need for continued improvements to the quality of the fruit - determined to a large extent by the post-harvest sorting, weighing and packing - while at the same time hammering home the message of raising productivity. As Francis Leonce, Geest's Managing Director, bluntly puts it: 'It's a damned good banana we produce here, but fewer people should produce a lot more of it !'

Both Government and the SLBGA are only too aware of the need to raise yields considerably above their disappointing average of six to eight tons per acre. BGA Managing Director George stresses that 'undoubtedly the whole industry shares the same concern to see efficient farmers produce more in a more cost-effective way, which in itself means inefficient farmers should be encouraged to move into other crops.' BGA interim Chairman Matthews remains confident that 'the productivity challenge can be met, if there is a sufficiently strong price incentive.'

The negotiating positions may look very entrenched at the moment, but as the old Dutch saying goes, 'the soup is never eaten as hot as it is served'. With the long-term survival of the banana industry at stake, the Windwards and Geest will 'more than likely arrive at a compromise that is satisfactory for both sides,' feels a confident Agriculture Minister d'Auvergne. Geest is clearly willing to cut a new deal with the Windwards, hoping, as Chairman Rapier puts it, 'that in the end common sense will prevail.' Putting its 40 years of banana trading experience into perspective, it would probably also like to ´see more of a proper business approach in the land-based activities. Many farmers, while needing to be better informed on the real issues of the shipping and merchandising aspects of an eventual new banana contract, could become more professional banana growers rather than take their crop, and its regular income, for granted. The BGA spokesmen, building on the renewed strength that a guaranteed market offers, are as confident that the farming community will meet the challenges of the future. 'After all, there is no way out but the way out,' stresses Chairman Matthews.

Linkages against leakages

The whole banana crisis has certainly made the need for agricultural diversification, already on the drawing board before, far more pressing. Restructuring the banana-growing community to make it more efficient implies weeding out inefficient farmers and cutting back on growing bananas on marginal land. This may be easier said than done as most farmers have become so heavily dependent on bananas. As Minister d'Auvergne describes it, it is part of their tradition and their culture. However profitable other crops may be, none offers the same dual advantage of regular cash flow and a 'secured' market-outlet. All other crops, whether vegetables, fruit or aquaculture products, will require increasingly developed managerial skills from farmers. With a higher degree of technological inputs needed, they will have to learn how to meet market demand at the right time, with the right quality and quantity. More generally, it poses Saint Lucia the challenge of identifying and conquering new niche markets when competition is already quite tough.

No one sees this diversification as a rival to the banana industry. On the contrary, most feel it should be built around and alongside it. Trying to promote a new type of high-tech farmer, able to live comfortably off his trade and with less tedious labour, is obviously part and parcel of a strategy to provide jobs for youngsters and in particular to arrest their drift to urban areas and/or tourist resorts offering more fashionable jobs.

Minister d'Auvergne, however, highlights an often overlooked factor potentially inhibiting the success of agricultural diversification. 'We face shrinking aid for agriculture in general as many donors have cut back their efforts in that field. But without aid and technology transfer in that sector, how can we develop it in a sustainable way? Our sustainable development can only be built upon our natural and human resources, so perhaps they should give more consideration to our farmers. Anyhow, are not these the number one protectors of the environment, which in turn is so vital for our other main economic pillar, tourism?'

The whole agricultural diversification exercise will not only be export-oriented but will also give considerable attention to linking up with the booming tourism sector. One might well ask why pineapples, tomatoes or fruit juices, to name just a few products, must be flown in from Miami or Puerto Rico, when local produce often tastes as good, if not better. Yet again, it poses the challenge of farmers being able to manage their fruit and vegetable production, to meet the quality, quantity and timing requirements of hotels and restaurants. Those farmers that have gone into such types of diversification, away from bananas, certainly have no regrets. One of them is George Edwards, who has successfully switched to growing a variety of vegetables and fruits such as dasheen, hot peppers, parsley, broccoli and watermelons. He agrees that his carefully maintained farm, with its own irrigation system, 'requires more work and more proper planning than bananas', but he continues, 'I sell all my produce without problems to the Marketing Board and I am certainly better off than before, when I grew bananas.'

Farmers like Mr Edwards have a pilot function in highlighting the profitability of the alternative to growing bananas. Within the tourism sector, there is active interest in encouraging farmers to aim at supplying the trade with local fresh quality produce. The 'adopt-a-farmer' programme tries to boost direct links between hotels and rural suppliers to their mutual benefit. People like Robert Whit field, General Manager of the distinctive Royal St Lucian Hotel, are only too aware of their high bill for imported fruit and vegetables. 'We have been lucky,' he says, 'to have been approached by an enterprising and clever lady farmer, Madge Barnard, who has been able to convince us, through the quality of her produce and the reliability of her supplies, that we really need not import everything. On the contrary, we are now actively pursuing local supply sources.' thanks to the hotel's contract, Ms Barnard, who already employs seven people, has been able to secure a loan to build a new greenhouse, thereby allowing her to increase production and boost quality. Hotels are increasingly negotiating deals of this sort with individual farmers or farmers' cooperatives.

At the national level too, awareness of the need to link agriculture more and more with tourism has led to this becoming a major priority. In fact, a joint agriculture-tourism mission recently went to Jamaica to study that country's very successful approach in keeping as much of the tourist dollar as possible 'et home'. The tourism authorities feel that their sector could make a major contribution to rendering non-banana agriculture far more viable - not to mention its impact on construction and manufacturing. The whole issue of 'linkages' against 'leakages' has to be seen, of course, against the background of the more fundamental debate on the actual contribution of tourism to the national economy. For, despite its steady growth over the past few years and the fact that it has helped to cushion some of the negative consequences of the banana crisis, it is still snubbed by many who allege that not enough of tourism's earnings stay in the country.

A dynamic tourism sector

The fact remains, however, that tourism has been doing well in recent years; so well, its spokesmen maintain, that it ought, perhaps, to be given some more proper consideration both within government and in society at large. Over the past three years, tourism grew on average by almost 11% per annum, and last year, as the biggest foreign-exchange earner, it brought in almost EC$ 570 million. Romanus Lansiquot, the enthusiastic Minister of Tourism (significantly this has only been a separate ministerial portfolio for a couple of years, despine Saint Lucia's well-established ranking as a top tourism destination), believes that 'there is a definite need both to enhance and to appreciate better that part of the tourist dollar that stays in the country.' He continues: 'Today it is alleged that only 40 cents in the dollar remain here, yet that has never been verified scientifically. We have appointed a research officer to compile the necessary data because we in the trade believe that tourism scores better and certainly has the potential for even greater spin-offs in areas such as agriculture, construction, manufacturing and maintenance. That is why the sector deserves a higher profile and more visibility.' A number of public awareness campaigns and other initiative within schools are aimed at making the whole community increasingly aware of tourism's contribution to the country's progress.

Last year, when many of the main tourism markets such as the USA and Europe were still suffering from recession, or were only gradually emerging from it, Saint Lucia succeeded in attracting a total of 356 000 visitors, of whom 195 000 were stay over tourists, the remainder being cruise ship passengers (154000) and excursionists (6700).

Despine a rise of almost 10% in the vital category of stayover visitors, compared with 1992, hotel occupancy rates in 1993 dropped from 73% to 68%, partly due to the coming on stream of new resorts.

These rat" vary sharply according to the season, however, and the overall figures also mask a growing divergence between the so-called traditional EP hotels and the all-inclusive facilities. The latter comprise about half of the almost 3000 hotel rooms available, and they seem to be far less affected by seasonal fluctuations, recording high occupancy rates throughout the year. Their share as a proportion of the total of hotel rooms has risen rapidly in recent years as a number of major traditional hotels have been taken over, refurbished and converted by well known foreign enterprises such as 'Sandals'. Their relative preponderance, making Saint Lucia a major 'all-inclusive' destination, has, however, prompted much argument and heated debate in the island. Many critics contend that this type of sojourn takes place too much in an enclave, limiting the local spin-off to restaurants, taxis etc. Tourism Minister Lansiquot has appointed a committee to assess their real impact on the overall economy: 'Of course, as is to be expected, there are pros and cons,' he says. 'Certain problem areas were identified, such as the enclave perception with a potential split between locals and tourists, or the lack of incentives for the latter to explore the country over and beyond their pre-paid facilities. These issues, however, can and have been positively tackled. On the other hand, they offer undeniable advantages. Many of these all-inclusive operators have their own aggressive marketing which gives a considerable additional boost to our own efforts. Their level of investment, often foreign in origin, has created a lot of job opportunities; jobs which they succeed in keeping going throughout the year thanks to their year-long high occupancy rates, which also shield local suppliers from classic seasonal peaks.'

Agnes Francis, acting Director of the Saint Lucia Tourist Board, adds that 'this type of accommodation is, after all, what the market wants today.' In terms of future development of room capacity, a figure of 5000 has been set as a target for the turn of the century and within that framework Mrs Francis highlights that 'there will a conscious move to strike a balance between all-inclusives and traditional types of accommodation by giving specific investment incentives.' She also feels that while the country has a wide array of tourist assets and potential attractions, 'a lot more needs to be done to develop our tourism product more efficiently. That will require a better overall understanding of our sector as a proper industry regardless of the contention of leakages which, combined with the presence, unlike in the banana sector, of many foreigners, seems to limit the perceived impact of tourism. It is, after all, the biggest direct and indirect employer and the main foreign-exchange earner!'

Both Minister Lansiquot and Director Francis stress the need to try and get more Saint Lucians in the industry up to higher levels of skills and management and to raise the overall level of service. 'Human resource development is really the key to it,' stress" the Minister, who would like to get support for a proper hotel training school. Already he feels that 'the European Union has made a very positive contributton to overall Caribbean tourism development.' EU-funded regional tourism support programmes have indeed, over the years, contributed considerably to boosting the Caribbean's image on the European tourism market. Regional cooperation, however, does not preclude tough competition and, as the differences of opinion on a common Caribbean cruise ship tax have illustrated, it is not always 'one for all and all for one'.

Air access, particularly out of Europe, is a problem as far as scheduled flights are concerned. Charter operations often focus on a more downmarket type of tourist. Saint Lucia, however, unlike its neighbours, Dominica and St Vincent, is fortunate enough to have not just a regional airport but also one that is accessible to international wide-body carriers. Needless to say, there is much concern here over the ailing regional carrier LIAT. Suffering from a long-standing management problem and facing heavy financial losses, its eventual privatisation process became enmeshed in the local politics of the region. Yet the call to make it an efficient carrier has never been more pressing.

A wake-up call for the nation

The 'all-inclusive' debase has also given rise to discussion about the overall role of local private entrepreneurs. Already in the tourism sector, generous tax concessions and further incentives have been developed to broaden the scope of involvement of nationals and many have responded by opening up smaller hotels. Yet, in a broader context, the Government cannot hide its disappointment about the fact that, in its view, the private sector has been lacking entrepreneurship. 'We have laid solid foundations in terms of infrastructure development, yet local entrepreneurs have not truly maximised the opportunities,' feels Minister Lansiquot. Minister d'Auverge, suggesting they could do a lot more in agro-processing, feels that 'many are too timid or too conservative to take the quantum leap. Most are only merchandisers in for a quick profit instead of investors with a long-term goal.'

The private sector is felt to have too much of a laid-back mentality and this could backfire on it. The Government, for instance, is inclined to allow the giant US supermarket chain K-Mart to open a branch in the Cul-de-Sac area, both to decongest the capital Castries and to stimulate competition with local suppliers. The private sector, which has operated until now in a protected economic environment, obviously does not welcome such a powerful competitor but it is increasingly conscious that it too will have to live up to the new challenges. Jacqueline Albertinie, the new and forthright Executive Director of the Saint Lucia Chamber of Commerce, Industry and Agriculture, agrees that 'it is a sorry thing the private sector has not developed to the extent it should have'. Pleading for far more intense institution building within the private sector, she feels 'more entrepreneurs can and must be created, while existing ones must become more development-oriented. Local capital is here, although with a lot of flaws in the current credit system, which does not exactly encourage innovative approaches. Yet the profit motive of the private sector can clearly be developmental in its impact. Government and the private sector should, therefore, come to terms with this and start pulling in the same direction to the benefit of all.'

With an official unemployment rate of 16.7% and some thousands of school leavers every year - though not always with the skills required to meet demand - job creation will be a sine qua non if continued progress is to be achieved. Facing up to it may be easier said than done for such a small, open and vulnerable island economy. Clearly the numerous and not always favourable changes imposed by the outside world have engendered a distinct feeling among Saint Lucians of having their 'backs to the wall'. Yet out of something bad, something good can grow, and Saint Lucia seems more than determined to adjust to the changing tides.

Roger De Backer