Turks and Caicos Islands Economy - Historical Overview
Sources: The Library of Congress Country Studies
In the late 1980s, the Turks and Caicos economy was considerably less prosperous than that of the Cayman Islands. The GDP in 1984 was approximately US$26 million, with a per capita GDP of US$3,478. Services employed 61.8 percent of the work force, industry 23.3 percent, and agriculture 14.9 percent. Thirty-three percent of adult women were in the work force in 1979. Imports exceeded exports by over US$18 million in 1982. Major trading partners were the United States and Britain.
Historically, economic development in the Turks and Caicos had been limited by weak infrastructure. The highway system on the islands was underdeveloped in the 1980s. South Caicos and Grand Turk Island had a total of 24 kilometers of paved roads; the other islands had a total of about 100 kilometers of gravel roads. However, the completion in 1983 of a British-financed airport on Providenciales was an important stimulus to the rapidly growing tourism industry. Within a year, a major international hotel chain had begun operations on the islands; the chain opened 100 additional rooms in 1985 as tourist demand exceeded expectations. In 1986 arrivals of stopover visitors to the Turks and Caicos increased by 22 percent over the previous year, one of the highest growth rates in the Caribbean. Two additional hotels were expected to be constructed in 1987. Large ships could be accommodated on South Caicos, Salt Cay, Grand Turk Island, and Providenciales. In addition to Providenciales, Grand Turk Island had an airfield with a runway capable of handling international flights.
As in the Cayman Islands, offshore financial services were an important component of the Turks and Caicos economy in the 1980s. More than 4,000 companies registered in the islands in the mid1980s to take advantage of the absence of company and income taxes and exchange controls. In 1986, however, the industry stagnated in response to increased competition from other Caribbean islands and investor concerns regarding the political situation in the Turks and Caicos.
Fishing had also become an important industry by the mid-1980s; lobster, conch, conch shells, and fish were the territory's principal exports. Exports of fish to the United States, the main customer, totaled US$3 million in 1983. Despite its importance, the industry was plagued by serious technological and marketing problems; overfishing was also a major concern. Almost all foodstuffs other than fish were imported by the Turks and Caicos. Low rainfall, poor soils, and the inadequacy of irrigation systems confined agriculture to small amounts of subsistence farming.
The Turks and Caicos government experienced chronic budget deficits in the 1980s; as a consequence, operating subsidies and development aid from Britain were essential. The 1983 closure of the last United States military base on the islands--a navy facility on Grand Turk Island--led to a loss in rent equal to 10 percent of total government revenues. In an effort to reduce expenditures, the government initiated a privatization policy in 1985; within two years, much of the debt-ridden electricity department had been transferred to private control. Because of the government's action, the deficit was reduced from US$4.3 million in 1984 to US$2.2 million for the fiscal year (FY--see Glossary) ending March 1987.
In the 1980s, domestic communications in the Turks and Caicos were only fair; international communications were of better quality. Although the islands had 1,400 telephones, service was often erratic and was limited to Grand Turk Island, North Caicos, South Caicos, and Providenciales. Two submarine cables and a small ground satellite station provided modern international links. Broadcasting was limited to one AM radio station on Grand Turk Island on 1460 kilohertz. The Turks and Caicos News was published weekly.
Data as of November 1987
NOTE: The information regarding Saint Kitts and Nevis on this page is re-published from The Library of Congress Country Studies and the CIA World Factbook. No claims are made regarding the accuracy of Turks and Caicos Islands Economy Overview information contained here. All suggestions for corrections of any errors about Turks and Caicos Islands Economy Overview should be addressed to the Library of Congress and the CIA.