Should We Be Concerned About The Performance Of St Lucia's Tourism Sector?

CASTRIES, St Lucia – Saint Lucia's tourism sector is faltering at a time when much of the Caribbean is recovering. Data released by the Eastern Caribbean Central Bank in December 2025 show that total visitor arrivals fell by 3.9 percent between January and September, equivalent to 14,463 fewer visitors than in the same period a year earlier. The IMF has described this as a clear underperformance relative to regional peers, attributing it primarily to hotel closures and reduced airlift in 2025. Yet the data suggest the weakness is broader and more structural in nature.

Every major tourism segment contracted. Stay-over arrivals declined by 3.2 percent (10,574 fewer visitors), cruise arrivals by 14.4 percent (69,084 fewer passengers), yacht arrivals by 6.8 percent (2,148 fewer) and excursionists by 17.8 percent (1,741 fewer). This was not a single-market shock but a system-wide slowdown affecting the island's principal growth engine.

A look at the market composition reveals a worrying story

The stay-over market reveals where the strain lies. Arrivals from the United Kingdom fell by 18.2 percent, amounting to 10,482 fewer visitors. Canada recorded a 14.3 percent decline, or 3,800 fewer arrivals, while other countries, largely continental Europe fell by 6.8 percent (1,011 fewer). These losses were only partly offset by the United States, where arrivals grew by 2.3 percent, adding 4,345 visitors, and by a marginal increase from the Caribbean market of 0.9 percent, from 40,938 to 41,312.

The result is a growing dependence on a single source market, whether policy-induced or imposed from outside. The United States now carries the weight of Saint Lucia's stay-over performance, cushioning declines elsewhere but increasing exposure to external economic and geopolitical risk.

Cruise tourism: Fewer passengers despite more calls

Cruise tourism performed even worse. Passenger arrivals fell by 14.4 percent, in line with a 27.8 percent decline in cruise calls, from 292 in 2024 to 212 in 2025. Even more telling is the longer-term comparison. By 2024, cruise calls were 9% above their 2019 level, yet cruise passenger numbers remained 63,243 below pre-pandemic levels, suggesting smaller vessels, altered itineraries, or weaker onshore demand.

Spending declines while exaggerates impact

Visitor spending mirrored the downturn. Total visitor expenditure between January and September fell by 7.2 percent, or $192 million. But even when expenditure appears strong, it overstates tourism's domestic impact. Tourism receipts recorded in the balance of payments capture gross spending, not what is retained locally. So using such an indicator might actually prove not very useful coupled with the fact that its methodological accuracy has been called into question by the IMF.

In 2024, total tourism expenditure was estimated at $3.6 billion. Yet the combined contribution of Accommodation and Food Services and Transport (land, sea and air) to GDP amounted to roughly $1.7 billion, just 47 percent of headline tourism receipts. The remainder leaks out; if it ever reaches Saint Lucia's shores through imports, profit repatriation by foreign-owned hotels and airlines, international booking platforms, and prepaid travel arrangements made abroad.

Employment: The numbers don't add up

One statistic does not fit neatly. Employment in tourism rose sharply in 2025. The sector employed 17,025 persons in Q3 2025, up from 13,871 in Q3 2024, an increase of 3,154 workers, even as arrivals fell by nearly 4 percent. This divergence raises questions about data consistency, labour productivity, or lagged hiring decisions taken during the recovery phase.

Has tourism recovered? Only partially

By 2024, total visitor arrivals reached 491,573, equivalent to 98.5 percent of the 2019 total of 499,261. Stay-over arrivals, however, has fully recovered, rising from 380,791 in 2019 to 435,573 in 2024. This recovery was driven almost entirely by the United States market, which surpassed its pre-pandemic level by 2022, rising from 191,719 in 2019 to 210,166.

All other markets remain below their pre-pandemic peaks: Canada at 87 percent, the UK at 98 percent, the Caribbean at 68 percent, and other markets at 73 percent. What is certain is that the recovery is narrow and uneven.

A fragile outlook

Looking ahead, risks are skewed to the downside. Heightened geopolitical tensions involving the United States, Saint Lucia's dominant source market alongside weak growth in the UK and Europe could further suppress arrivals. Cruise tourism remains especially vulnerable to security concerns in the wider Caribbean.

What does this implies?

Saint Lucia's post-2020 tourism performance appears to have been driven less by domestic competitiveness than by a region-wide rebound that is now fading. As neighbouring destinations such as Grenada, Dominica, St Vincent and the Grenadines, and St Kitts expand airlift, add hotel capacity, and in St Kitts' case push aggressively into home-porting, Saint Lucia risks losing market share.

The data point to a deeper question: what is Saint Lucia's tourism strategy for the next five years and beyond? Without a clear answer, the island risks remaining dependent on favourable external tides, mistaking recovery elsewhere for resilience at home.

What's next?

A more comprehensive analysis will follow to establish whether Saint Lucia is, in fact, ceding market share to its regional peers, particularly within the OECS and Barbados. The evidence warrants closer scrutiny. Stay tuned.

Island Development Insights

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