History, Politics, Economy and Startups in Grenada.
La Grenade is a small country which played the big role in the Cold War.
Grenada was first inhabited by Kalinago people in the early 17th century. French colonizers took over the island in 1649 and drove indigenous population off their lands in 1654. Seven Years’ War put an end to the French presence on the Island of Spice and British troops took over it as an aftermath of the Treaty of Paris signed in 1763.
1950th and 1960th became the period of civic unrests and of gradual diminishing of British power in Grenada. It culminated on 7 February 1974 by the independence granted to the island by the Crown. In March 1979 Marxist-Leninist New Jewel Movementorganized the coup d’etat and Maurice Bishop — graduate of King’s College in London — became the new prime minister of Le Grenade. The main page in the history of the island was about to be turned over.
Bishop firmly took the political course towards the Socialism and embraced Cuba leader Fidel Castro’s as well as USSR Politburo’s friendships. Ronald Reagandidn’t find too many reasons to sympathize with all of that. However, it is only after Bishop was overthrown by its own much more radical ‘comrades’ that White House decided to act.
One of Bishop’s civic infrastructure development initiatives was to build 3000 meters airstrip on Grenada. Reagan’s analytics assumed that this strip could have dual application by allowing heavy military plains to land on it. Game was on and Operation Urgent Fury commenced at 05:00 on 25 October 1983. Around 8,000 USA troops supported by AC-130 gunships and AH-1 Cobra attack helicopters fought against 1,500 Grenadian and 700 Cuban soldiers. Actions lasted about six days and ended on November 1 by 22nd Marine Amphibious Unite capturing the island of Carriacou 27 kilometers northeast of Grenada. Democratic government was reinstalled in capital city St.George’s but United Nations firmly condemned this intervention by voting 108 to 9 against USA.
Today Granada is a parliamentary democracy within the Commonwealth realm. Its bicameral, 28-members Parliament is dominated by New National Party(center-right) with 22 seats. Opposing National Democratic Congress (left) has only 3 seats. This two-party, left-wing-right-wing political combination is common for many countries with the Westminster system of governance.
Tourism and spice production are two major sources of revenue for Grenada’s population. Since the beginning of 2000th island’s GDP more than doubled and reached $1 billion. Grenada’s per capita is around $9,000 which is comparable with other Caribbean countries.
Small size of population, absence of technological industries, relative geographical isolation, outdated education system — those factors make this country’s economy not well suited for high-tech entrepreneurs. Additionally, as in many other islands, the cost-of-living is relatively high there, for real estate (and rent) isn’t cheep and majority of goods must be shipped from overseas. Plus, Internet penetration rate stays low (for Caribbean nation) on less than 40%, which reduces number of potential local users to less than 70,000. Costs of transfers from and into the island add an additional constraint to the availability of high-tech talents in Grenada.
On the other hand, Grenada’s GDP has been consistently growing since 2011 and mobile e-commerce (specially in tourism related spheres) provides local high-tech founders with some profits opportunities. Additionally, in a past couple of years, local government had started to realize the importance of new technologies as a major source of employment for youths. As a result, Grenadian startup ecosystem had started to get some limited administrative and financial supports.
However, those steps haven’t resulted in a significant increase in a number of efficient e-businesses. In order to accelerate the slow speed of local technological development much more active measures and some structural, administrative reforms are needed.
Business Notes for Startups Founders:
- political climate: moderately friendly;
- economic climate: not friendly;
- regions to focus: Caribbean;
- industries to focus: mobile e-commerce, tourism, hospitality;
- major limitations: small population, high administrative barriers, inadequate level of taxation for SME, shortage of qualified workforce;
- opportunities: low competition.