Small Island Tourism Economies: A Snapshot of Country Risk Ratings

Abstract: Over the last twenty years, there has been a growing fascination about the livelihood of islands with small populations and territories which overwhelmingly rely on tourism as a source of exports. The Small Island Tourism Economies profiled in this paper were colonised, and had depended heavily on financial aid from their former colonists for infrastructure development that has declined dramatically since the collapse of the Soviet Union. The economies profiled in this paper are developing countries which need a consistent inflow of Foreign Direct Investment to maintain economic growth. These small economies have limited resources, are perceived to suffer from frequent natural disasters, and therefore the international financial community considers them to be risky entities. The snapshot images given in this paper provide a comparative assessment of the international country risk ratings, and highlight the importance of economic, financial and political risk ratings as components of a composite risk rating for Small Island Tourism Economies.