Executive summary
Guadeloupe, a French overseas department in the Caribbean Sea, boasts a population of approximately 371 000, contributing 0.6% to France's total population. GDP per capita in 2020 was EUR 21 100, equivalent to 65% of the EU 27 average, making it one of the 78 EU less developed regions.
The economy of Guadeloupe has undergone significant transformation in the 20th century, driven by large investments from mainland France. Infrastructure development and the extension of French social legislation led to substantial growth. More recently, Guadeloupe's economy experienced dual phases. Between 2000 and 2008, the region's growth outpaced the national average, driven by infrastructure investment, tourism expansion, and real estate development. However, the 2008-09 financial crisis and COVID-19 slowed growth. From 2010 to 2019, the economy grew at an average rate of 1%, marked by decreased domestic consumption, feeble exports, and challenges from extreme weather conditions such as Hurricane Maria, which hit in 2017 destroying 80% of local banana production. High unemployment, standing at 18.5%, remains a major challenge.
Guadeloupe's economic landscape is predominantly service-oriented, with a significant public sector presence. Public administration-related services constitute approximately 40% of gross value added (GVA) and employment. Other essential sectors include business services at 27% and commercial activities at 15% of GVA. Agriculture contributes about 2% of GVA but is on the decline, while industry (including energy and manufacturing) contributes 9% of GVA. Guadeloupe primarily exports agro-food products like bananas, sugar cane, and rum, with major trade partners including mainland France, the United States, Canada, and other EU countries. However, trade with other Caribbean nations remains limited.
Leveraging local assets will be central to the future internationalisation strategy of Guadeloupe. Three areas appear particularly relevant: circular and bioeconomy, renewable energies and cultural and creative sectors:
Guadeloupe's extensive nature reserves, spanning 77% of its territory, provide a strong foundation for sustainable economic activities. The circular and bioeconomy sectors offer substantial potential to rejuvenate the region's ecosystems and create new business opportunities. Implementing circular economy practices, such as utilising sugarcane and banana waste, can reduce the region's carbon footprint and bolster renewable energy prospects. Promoting organic agriculture can enhance land sustainability and reduce reliance on fertilisers, aligning with global eco-friendly trends.
Like other EU Outermost Regions, Guadeloupe heavily relies on imported fuels, constituting 90% of its total energy supply and 10% of its GDP. Nevertheless, the region has made commendable progress in renewable energy development, with renewables accounting for 23% of electricity generation in 2020, up from 10% in 2010. This progress aligns with the European average (24%) and surpasses neighbouring Caribbean countries (17%). Exploring biomass energy sources can lead to enhanced energy self-sufficiency while adhering to circular economy principles.
Guadeloupe's thriving cultural and creative industries, comprising 2.5% to 7% of all establishments and contributing 1.5% to 2.5% of employment, represent an underexplored avenue for economic growth. Rooted in the region's Creole culture, these industries hold significant regional and international appeal. With the global value of cultural and creative goods exports exceeding USD 524 billion and creative services valued at USD 1.1 trillion, Guadeloupe's culture sector can tap into this expanding global market. The rich Creole heritage, including musical styles like Gwonka and Bouladjel, can inspire local artists and promote festivals, contributing to economic and cultural vibrancy.
Moving ahead to materialise these opportunities, Guadeloupe could increase its global interconnectedness to support regional development. In particular, the region should aim to:
Strengthen strategic partnerships in the Caribbean. Leveraging its strategic location and EU market access, Guadeloupe can enhance partnerships and integration within the Caribbean basin. This includes participation in regional infrastructure projects, intra-regional trade, and the provision of Quality Infrastructure Services (QIS).
Better leverage opportunities provided by EU cohesion policy funds. Guadeloupe can harness opportunities offered by EU sectorial programmes like Horizon Europe for research and innovation. Collaborative R&I projects, partnerships with European institutions and businesses, and capacity building in innovative sectors can strengthen the region's innovation ecosystem.
Promote a holistic regional development approach. To enhance competitiveness, Guadeloupe should adopt a comprehensive policy agenda that aligns EU and national financing and strategies. Engaging private sector representatives in policy discussions, exploring regional autonomy options, and improving co-ordination between funds, such as the National Recovery and Resilience Plan and cohesion policy funds, are vital steps.