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Grenada wins double gold with FX news and global tourism report

May 16, 2014Article by Ray Withers

As summer approaches and our thoughts turn to holidays and travel, it’s also worth thinking about the best-timed investments for this season. Step forward Grenada, which today wins our attention on two counts – the current FX exchange rate and the just-released World Travel and Tourism Council report.

Flirt with FX to get more for your money

First let’s look at the just-in FX news. We are currently seeing excellent exchange rates against many currencies, with the US dollar at its cheapest rate against the GB pound for years and the Euro flirting with its cheapest rate this year. So what does this mean for you? Well basically you get more for your money. When the GB pound is strong, it’s time to take act on those international investments you’ve been considering.

However, we’re also expecting the new Bank of England quarterly inflation report this week, at the same time as the latest unemployment figures are released. This is significant because inflation prospects can influence the value of sterling since they guide the Bank’s options when it comes to interest rate rises and, in turn, exchange rates.

How rising rates give sterling strength

While lower inflation is good for the UK economy it can have a negative effect on the GB pound, whereas rising interest rates help maintain sterling’s strength. This means the best time to act to take maximum advantage of a strong GB pound against another currency is now, before it (possibly!) starts to fall again.

We are also expecting inflation and GDP figures for the Eurozone and the US dollar this week, along with their employment figures. Depending on the outcome, we could see a rise in the strength of either or both. More reasons to strike while the sterling iron is hot!

A sunny long term forecast for the Caribbean

Now let’s head off to the glorious sandy beaches of the Caribbean to see what’s happening in Grenada. Well, there’s no massive change on last year in terms of forecasts, but the figures are up slightly to 4.5% per year (between 2014 and 2024), representing a 55% ten year growth. So while the increase might look small, taking a longer term perspective shows both strength and stability.  Grenada also continues to be forecast as the third fastest developing country in the Caribbean for tourism (behind St. Lucia and St. Kitts & Nevis).

Tourism continues to shine in global economy

Overall, according to the report, 2013 proved to be another successful year for the Travel and Tourism industry. The sector’s contribution to global GDP grew for the fourth consecutive year, helped especially by strong demand from international travellers. Demand from emerging markets also kept pace, as more people are willing and able to travel both within and beyond their boundaries.

In 2013 the Travel and Tourism sector contributed a whopping 9.5% of global GDP (US $7 trillion). This both outpaced the wider economy and also showed sector growth which was faster than any other significant sectors, including financial and business services, transport and manufacturing.  In total, nearly 266 million jobs were supported by the sector in 2013 – that’s one in eleven of all the jobs in the world!

A true force for good

The report states “If the right steps are taken, Travel and Tourism can be a true force for good” and I couldn’t agree more. Particularly in emerging markets which offer favourable business climates and incentives for investors – such as Grenada. The island is expected to attract 120,000 international tourists in 2014, with this figure rising to 175,000 by 2024.

This fits in nicely with previous preductions that Grenada will be the fastest growing market in the Caribbean between 2011 and 2021. This certainly puts a smile on my face, as we’ve been tipping Grenada as the one to watch for the past year or so. Personally I love this island and will fly out at the drop of a hat whether it’s in fashion or not, but it’s always good to see the figures back up your predictions.

Golden opportunities and glorious beaches

Grenada really is a bit special. It is less spoiled than some of its more popular neighbouring islands and, from an investment perspective, it gives you affordable entry into a luxury Caribbean market while also taking advantage of its emerging economy status and the booming tourism trade. Add in the currently-favourable exchange rates and you have one golden investment opportunity right here, right now. Remember though, rates can change at any time so the faster you act the better value your deal will be.

Get in touch on +44 1865 202 700 to find out more about investing in the Caribbean and how you can gain an average yield of 10.5% net pa from a 5* sea view hotel suite in the glorious Bacolet Bay Beach Resort.


Ray Withers

Ray has over 17 years’ experience in the international property market and bought his own first international property investment back in 2002. Aside from running Property Frontiers, Ray has been involved in residential, hotel, student and commercial property investment and development in both the UK and overseas and co-wrote "Where to Buy Property Abroad - An Investor's Guide". As Founder and Trustee of the Frontiers Foundation, Ray is directly involved with many of its projects to ensure they have a direct and tangible impact in individual communities across the globe. He is passionate about property, travelling, scouting out new opportunities and finding time to spend with his young family.
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