Updating and augmenting the economic vulnerability index

Abstract

The characteristics of small island developing states (SIDS) are well documented, and include limited ability to exploit economies of scale; lack of natural resource endowments and a high import content (especially of strategic imports such as food and fuel). Other characteristics relate to limitations of diversification possibilities; dependence on a narrow range of exports; limitations on the extent to which domestic competition policy can be applied; inability to influence international prices; and in the case of island states, high international transport costs and uncertainties of industrial supplies due to insularity and remoteness.