Economy

Tourism dominates the economy, accounting for more than half of the GDP. Weak tourist arrival numbers since early 2000 have slowed the economy, however, and pressed the government into a tight fiscal corner. The dual-island nation's agricultural production is focused on the domestic market and constrained by a limited water supply and a labour shortage stemming from the lure of higher wages in tourism and construction work.
Manufacturing comprises enclave-type assembly for export with major products being bedding, handicrafts, and electronic components. Prospects for economic growth in the medium term will continue to depend on income growth in the industrialised world, especially in the United States, which accounts for about one-third of all tourist arrivals.