The offshore financial service sector, foreign direct-investment and tourism are the propellers of the economy. These are attributable at least in part to the Barbadian government's initiatives to evolve the nation into a service-driven economy and a regional financial hub for the Caribbean.
Offshore finance and informatics are the nation's important pillar industries, and there is also a light manufacturing sector whose importance is waning. Since the 1990s the Barbadian government has been seen as business-friendly and financially sound. Its efforts to woo direct foreign investment seem to be incessant.
The Barbados government is in favor of the investment in financial services, informatics, e-commerce, tourism, educational and health services, and cultural services for the future. Judging by Barbados' pace of growth, it is supposed to become the world's smallest developed country by around 2025 at the latest.
In May 1972 Barbados formed its own Central Bank, breaking off from the East Caribbean Currency Authority. By 1975 the Barbadian dollar was pegged constantly to an exchange rate with US$ 1 against BDS$ 1.98. This move helped stabilize the tiny island's currency and weeded out the risks for the Barbadian exporters by locking the rate for which they sell US$ for BDS$.
Barbados has the third largest stock exchange in the Caribbean region. Executives at the stock exchange are studying the possibility of augmenting the local exchange with an International Securities Market venture. As a result, Barbados will be launching an international Stock exchange and international trading platform in 2011. Barbados is ambitiously pursuing its goal to be the Caribbean regional financial center.
The traditional trading partners of Barbados include Canada, as of 2003 the island saw from Canada CA$ 25 billion in investment holdings, placing it as one of Canada's top five destinations for foreign direct investment, the United States, the United Kingdom and the Caribbean Community, especially Trinidad and Tobago.
The European Union is presently assisting Barbados with a
