Grenada’s mid-year financials tell a story bigger than numbers: an island state caught between dependency on transactional revenues and the reality of a narrowing fiscal base.
The Ministry of Finance disclosed that the government collected EC$627.7 million in revenue and grants in the first six months of 2025 — a significant contraction compared to EC$740.3 million a year earlier. That EC$112.6 million shortfall isn’t just statistical; it’s structural, exposing how much of Grenada’s fiscal engine is tied to volatile and external-dependent flows.
The Passport Economy Weakens
For years, Grenada leaned heavily on its Citizenship by Investment (CBI) programme — a controversial but lucrative stream that trades citizenship for foreign capital. That pipeline now shows cracks. In June 2024, CBI inflows reached EC$40.5 million. A year later, only EC$10.5 million was realized.
The decline highlights a growing vulnerability: when passport demand dips or global policy shifts, fiscal stability falters. A programme meant as a supplement has become a pillar — and pillars aren’t designed to wobble.
Spending Choices Under the Microscope
Grenada’s government has trimmed current expenditure, coming in under target for June. But at the same time, capital spending surged well above expectations, suggesting a push to build or expand infrastructure even as revenues thin. It’s a gamble: infrastructure spending can stimulate long-term growth, but overshooting targets while revenue shrinks invites scrutiny.
The Balances Tell the Tale
The June report shows a primary balance of –EC$14.8 million, a swing from last year’s healthier surplus. Debt payments remain modest, but with weakened inflows, even modest obligations feel heavier. Year-to-date, the government is running an overall deficit, though smaller than initially projected.
Bigger Than a Monthly Report
This is no longer about a single quarter’s slump. The real story is about fiscal dependency. When an island’s economic health hinges on how many foreign millionaires want a second passport, or whether property tax collections hold steady, the room for fiscal sovereignty narrows.
Grenada now faces a pressing choice: diversify its revenue model or risk long-term instability. With debt obligations, infrastructure demands, and an electorate expecting delivery, the government is walking a tightrope — one where balance matters more than ever.
