Apart from being the biggest healthcare crisis of the century, the COVID-19 pandemic also poses a serious economic threat. And if larger economies have a better chance at bouncing back, small economies, such as the island of Grenada, in the Caribbean, are already in survival mode. The “Spice Isle,” as it’s also called, Grenada faces a similar situation to other small economies in the region: its GDP relies almost entirely on tourism, and tourism was the first sector to be hit by the pandemic.
According to the United Nations World Tourism Organization, the Caribbean experienced the highest growth in the past five years. From the stunning views to the hospitality of the Caribbean people, Grenada attracts thousands of tourists every year, and, until now, this has created many opportunities for the island. Last year, for instance, the nation reported a 3.1% GDP growth. But now, with tourism at a halt, Grenada was left without its main source of income, and the emergency funds from the IMF are already depleting. The GDP has already shrunk by 5.5%, and the economic outlook isn’t optimistic.
Even by the most optimistic estimates, the travel industry will not resume until mid-2021; and it might take much longer for people to regain trust in airlines and travel as carelessly as before. In this context, a major recession would become inevitable, and Grenada needs to consider alternative ways of diversifying its economy in order to survive. Otherwise, it risks repeating the same situation that happened in 2004, when Hurricane Ivan hit the island.
Since IMF support is only a temporary solution, Grenada needs to consider long-term recovery avenues, and some of the best ones could come from sustainable projects that maximize the island’s natural resources responsibly. The best example that could become a source of inspiration for the entire Caribbean region is the Grenada Sustainable Aquaculture initiative, or GSA. The project was launched by Soren Dawody, an experienced investor who runs a high-end real estate development company based in Cyprus. Since 2015, Dawody has taken an interest in altruistic investment, and, through GSA, he aims to diversify the income of Granada’s economy and bring new sources of income to the local people. For the Grenada Sustainable Aquaculture project, he has collaborated with the Government of Grenada, and his mission is to stimulate the evolution of the local job market by creating new jobs and boosting entrepreneurial activity.
In the context of the pandemic, Grenada can no longer afford to rely only on tourism.
Grenada is a touristic gem, but it doesn’t have a solid economy. Perhaps its biggest downfall is the unemployment level. In 2019, 25% of the nation’s population was unemployed, and very few people had access to quality education. As a result, most locals worked in tourism and related industries that required close personal contact and that the pandemic put on pause. With the GDP initiative, Soren Dawody wanted to create new opportunities for locals and generate new job positions that could be filled right away, without the need for extensive training and relocation. What’s more, Dawody wanted to tap into the potential of sustainability projects – an area that Grenada has much to gain from and that could become the future of the economy, but that has been underexploited so far.
How could the Grenada Sustainable Aquaculture project help the economy, and what can other countries learn from it?
As part of the GSA project, Soren Dawody and his team will build a sustainable aquaculture farm based on state-of-the-art zero-waste exchange production systems. Moreover, the farm will be synchronized with local fishing operations without harming Grenada’s ecosystem. The farm will have mature fish stocks, and that alone could increase the annual production of fish products to 8,000 tons. After these products have been farmed, part of them will be exported to South America and the US, and a percentage will remain available to local markets. Even if this project doesn’t imply the transition to a total export model, it will still bring a great contribution to the local economy by boosting the aquaculture sector and improving food security for locals.
According to initial estimates, the aquaculture farm will provide a positive cash flow in as little as three years – and that includes local consumption. In the long term, GSA could increase Grenada’s gross domestic product by 9% and generate over 400 jobs. The aim of this initiative isn’t to surpass tourism and become Grenada’s primary source of income; it’s to diversify the local economy and create a solution to bounce back from the crisis. Thus, the island nation would be more resilient to similar events that impact tourism in the future. For example, Grenada is particularly vulnerable to natural disasters (earthquakes and hurricanes), and its economy has historically been affected by them.
Grenada Sustainable Aquaculture could also fuel progress in other departments:
- The high-end equipment used on the farm will increase productivity and reduce reliance on manual labor.
- The farm will generate jobs in technical roles and thus boost worker education.
- The project will encourage new strategic partnerships between Grenada and foreign investors, attracting new sources of revenue to the country.
- It will fill the seafood supply gap in a responsible way, without affecting marine life.
- Aquaculture has lower greenhouse emissions compared to other types of farming, so it will help Grenada meet its sustainability objectives and become an innovation hub.
According to a recent estimate, the demand for animal protein will rise by 52%, and meeting this demand responsibly can only be done through sustainable methods, such as the GSA. When done in a careful way, that’s mindful of local culture and the local ecosystem, aquaculture can fuel growth in an eco-friendly way, and other island nations should consider Grenada’s example to mitigate the economic impact of the pandemic. Grenada has already caught the interest of foreign investors with the GSA, and it will be interesting to see how this project will fuel innovation in the following years.