Rebuild the Island Better Together: Island Economy Amid and Post COVID-19 Crisis

Posted by: Yihan Wang - Business Development Advisor – Sustainability & Foreign Direct Investment on Tuesday, September 22, 2020

The COVID-19 crisis harmed island economies disproportionally hard, but it also presents immense opportunities for islands to rebuild safer, stronger, more diverse, and more equitable economies. 

The US Virgin Islands is a US territory located at the crossroads of mainland U.S. and Latin America. Its pristine landscape and rich culture has made tourism the number one economic sector for decades. Tourism consists of 30% of the island’s GDP. However, the global pandemic COVID-19 has devastated the tourism industry due to the closure of cruise ship lines and air travels. This intensifies an already challenging economy in the USVI impacted by hurricane Maria & Irma in 2017. 

In every risk, there are new opportunities. The COVID-19 crisis sends an alarming signal to economic developers and policymakers to diversify the economy, strengthen sustainability and resilience, and address systemic issues that have hampered economic development in the past. The pandemic generated urgency for stakeholders to collaborate for transformational changes. 

Here are four areas the RTPark is actively working on with our partners in a myriad of industries to shape a more prosperous economy:

Small Business

Small businesses are the backbone of our economy. As an economy that is heavily shaped by tourism, small business such as hotels, restaurants, and retails are at the heart of economic recovery. The RTPark keenly makes small business revitalization and transformation at the top of our focus for economic development. It is time to rethink small business strategies and restructure our business model to adapt to the new reality brought on by the pandemic. Particularly, community leadership should:

  • Deploy new models to provide support to small businesses and entrepreneurs 
  • Support businesses and services to move online
  • Update procurement processes and incentivize large businesses to source locally from small businesses 
  • Provide loans and subsidies creatively to save small businesses from bankruptcy 
  • Build capacity so that small businesses that reemerge from COVID-19 have the knowledge and connections needed to thrive 

Workforce Reskilling and Development 

Workforce reskilling is particularly critical in this unprecedented time. Technology industries and automation are thriving, while the traditional service industry is declining. To be competitive and resilient in the future workforce, workers and talents need to rethink their skillsets. The RTPark is working aggressively to structure programs that reskill displaced workers to find new jobs and help talents transfer their skills to careers that will be growing long into the future. In addition to adult workers, this crisis also highlights the importance of training youth and providing support and opportunities to the younger generation to be mindful of changes and ignite their interests and curiosity of learning skills that are promising in the future. Currently, we have several programs designed to meet these needs:

  • Adult Coding Bootcamps
  • VISTA+
  • STEM Kids Program 
  • Attracting new technologies and train local communities and businesses using those technologies 

Economic Diversification

Historically, tourism is the principal private-sector economic activity in the US Virgin Islands. Tourism expenditures amount to approximately 30% of GDP and generate 42% of total exports, and on average, 8,000 direct jobs in an economy with a civilian workforce of 42,000. The pandemic devastated the tourism industry globally while shedding light on the urgency of transforming the tourism industry and diversifying the economy.

Economic Equity and Sustainability 

The COVID-19 pandemic highlights the urgency of developing an economically viable, socially equitable, and environmentally sustainable economy. The potential of small islands pursuing a sustainable economy depends on maintaining the limited natural resources’ quality, and our economy is vulnerable to ongoing environmental challenges due to geographical isolation. Strengthening sustainable enterprises is critical in building the U.S Virgin Islands’ capacity to cope with environmental hazards, external financial shocks, and health crises. Economic developers need to also think about inclusion and integration of local communities’ voices, ideas, participation and support that tailor to community needs. 

Client Testimonials

There are many unique treasures to living here. I’ve discovered a passion for mountain biking. My children have learned to sail. With a small community, you get to know people quickly. We found they went out of their way to make us feel welcome. When considering the move, a top concern was the children’s education. We found a quality school our kids love, with a dedicated faculty. In fairness there is an adjustment period. You learn to navigate island life, master shipping logistics, get to know a new culture, and take in some of the most beautiful ocean views in the world.

David Thompson, Exigo

In January 2012 my business was underway as a Tech Park entity. It has been a wonderful seven years. The Tech Park has always been supportive, easy to do business with, and is making a positive impact on the islands. The Tech Park organization is professional and efficient. They have created a friendly business environment that has been a pleasure to work within and a great experience overall. I would encourage any eligible entity to consider joining us in the Tech Park.

Louise Stapleton, LNL Publishing

Our firm, The RainTree Group, came into the UVI RT Park program in 2018.  We didn't have much experience in the USVI and followed the advice of the wonderful RT Park staff and other RT Park tenants.  The application process was transparent and straightforward.   The simple concept of the Park is mutual benefit - your company gets some tax incentives that allows you to grow your business more quickly and the USVI and UVI gets additional tax base, employment opportunities, and scholarships for deserving students.  The business environment and life in the USVI is slower paces and less stressful as the mainland, and without question the biggest business hurdle is communications, so find an office location where you have investigated the broadband options. Come and join us, you won't regret it!

James Salter, VosCom dba The RainTree Group

We have been part of the RT-Park program for almost three years now.  The application process was straight forward and we had plenty of dialogue and feedback prior to our approval.  My only regret is we didn’t do this sooner.  It is satisfying  knowing that we are partners with UVI and enabling the education of the next generation .  We also love living in the USVI.  People are warm and welcoming and the pace of life is amazing healthy.  Most days it feels like a working vacation.

Andy Hemmert, President , HRMT, LLC