David R. Salmon | The future of economic development in the Caribbean

Last year was a gruelling one for Caribbean economies. With international disruptions, such as tariffs, geopolitical tensions and natural disasters, the year underscored the importance of advancing the mission of economic development.

Of particular concern is the need to diversify the economy away from traditional sectors that we have specialised in. For instance, the long shadow cast by Hurricane Melissa has shown that putting all our eggs in the tourism basket is not the best approach to support economic resilience.

Similarly, the decision of the United States to levy tariffs on global imports, introduce a tax on remittances and proposed regulations on call centres, highlights the precarious position the region finds itself in due to its overwhelming reliance on the US market.

Rather than turn inward, the future of the Caribbean’s economic development rests on strategic engagement with the region while also targeting new markets for goods and services. On the first measure, countries like Jamaica must continue to pursue economic integration with CARICOM to support local industries. This includes being more open to intra-regional immigration to address shortfalls in labour and talent.

Additionally, bold action should be taken to achieve a more unified energy market. The matter of energy has been a major sticking point in the regional bloc. But with Guyana expected to grow as a hydrocarbon exporter, the Caribbean now has an opportunity to realise cheaper energy prices through negotiations with our South American counterpart. In return for cheaper energy prices, Guyana can benefit from the region’s educational institutions and expertise to support its own economic diversification.

Importantly, Caribbean countries must also increase extra-regional engagement, including attracting investments from markets such as those found within Latin America. These kinds of partnerships are needed for continued economic development in 2026.

David R. Salmon is Jamaica’s 2023 Rhodes Scholar and a DPhil student in Public Policy at Oxford’s Blavatnik School of Government. His research examines economic diversification in small island developing states.