Montserrat - Economy
Montserrat has a small, open economy with few natural resources. By the late 19th Century the principal industries in order of importance were sugar, limes, coffee, cacao, arrowroot, papain (from the papaw fruit) and bay oil. The other crops commonly grown in the island were sweet potatos, yams, eddoes, beans, pigeon-peas, cassava, arrowroot, tous-hs-mois, aloes, ginger, and Indian corn. The fruit trees furnished tamarinds, oranges, bread-fruit, bread-nuts, and papaws. Many drugs, gums, and resins were found in the mountain woods, and pimento was said to be plentiful, but was not collected for export. Englishmen Francis Burke and Edmund Sturge introduced limes as a crop on Woodlands Estate in 1852. The intelligent and progressive action adopted by the Montserrat Lime Juice Company had a very beneficial effect in suggesting other subjects of cultivation in the island. Next to sugar, the most important industry was that of lime juice. By the 1890s the area under cultivation in lime trees on the Montserrat Company's estates, was 1,247 acres, containing 250,000 trees, while 153 acres are in limes on sugar estates and on small properties distributed over the island.
What would become Montserrat’s largest landowner and enterprise, the Montserrat Company, was formed in 1869 by investment partners and descendants of Joseph Sturge IV. Sturge, a Quaker, purchased the Bransby sugar estate with the intention of demonstrating sugar production using free, wage-earning labor. At its peak, the company owned over 4,000 acres across various estates. The area under cultivation in sugar cannot be exactly stated, but may be approximately estimated at 6,000 acres, equal to 40 per cent. of the cultivable area, and 66 percent of all lands under crops. The sugar industry was carried on, partly by proprietors working their own estates, partly by the metayer system, and partly by small holders.
The small cultivators in Montserrat are an industrious and thrifty people, and they could grow both fruit and vegetables on a moderately large scale for export purposes. The conditions are favourable for starting a fruit trade similar to that already recommended for St. Vincent and Dominica. This would afford immediate assistance in starting other cultivations, and the condition of the people would be greatly improved. The only reason why fruit and vegetables are not more largely grown is the absence of suitable facilities for shipping the produce.
Sea Island Cotton was the largest economic driver for the island by 1912. Grown on 2,000 acres, it produced 402,000 pounds of lint. Peak production happened in 1941, when 5,395 acres yielded 1.2 million pounds of lint. However, the back-breaking labor required to grow it, the inability for small growers to make a profit from it and pests eventually led to the demise of the industry in the 1950s.
Prior to Soufriere volcano's eruption in 1995, Montserrat developed as a residential tourism island -- foreign visitors buying or renting private homes in an extensive area on the Caribbean side of the island. In a very unusual and thoughtful development, there were 400 homes on spacious grounds owned, visited and rented by people from the United States, Canada, Denmark, Germany, Italy, and England.
AIRStudios-Montserrat, built in 1978 and opened in 1979, made Montserrat a world renowned music/tourism destination. Music Legends such as Paul McCartney, Elton John, Stevie Wonder, and the Climax Blues Band visited to enjoy the tranquility of the island while they recorded their Music at AIRStudios-Montserrat. Its currency is the Eastern Caribbean dollar (EC$). The economy grew between 2006 and 2008, but declined in 2009 and 2010 due to the global economic crisis. Inflation remained under 5% over 2006–2010. In 2009, the government service sector was the largest contributor to gross domestic product, at 37.1%. The tourism sector experienced growth in 2010 due to an increase in the number of visitor stopovers, cruise ship passengers, and excursionists.
Agriculture maintained a 3% contribution to the islands growth between 1983 and 1995. Although the industry declined over the years due to migration and a lack of interest by the younger generation, it was experiencing a rebirth in the 1990’s before the volcanic crisis began.
Prospects for the economy depend largely on developments in relation to the volcanic activity and on public sector construction activity. Half of the island remains uninhabitable. Farming for those farmers, who remained was challenging, given the topography of the land, soil quality and the threats of effects of the volcanic activity such as acid rains. The fishers has also had their share of challenges, with reduction in the designated fishing boundaries; and fishing storage infrastructure being destroyed.
In January 2013, the EU announced the disbursement of a $55.2 million aid package to Montserrat in order to boost the country's economic recovery, with a specific focus on public finance management, public sector reform, and prudent economic management.
Montserratians need clean, affordable, reliable and renewable sources of energy, that do not harm or degrade the environment. Through its new energy policy, the Government is already moving to provide clean renewable energy, with the objective of reducing the use of fossil fuels and thus reducing its contribution to carbon emissions. Through the Government’s Geothermal and solar projects, the achievement of 100% renewable clean electrical energy will be realised by 2020.
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