Economy & Industries

The economy of the Canary Islands of today is based on the tourism industry, counting for up to 80 per cent of the gross income of the archipelago. With one of the best climates of the world, the islands attract millions of tourists every year, with growth rates continuing to increase year by year. Besides that, but at a much lower level, locals live from the banana industry, other agricultural exports and new tourism related service industries.

In the centuries following the Spanish conquest the mainstays of the Canary Islands’ economy were the sugar and viticulture industries. Sugar production on the islands started right after the conquest with sugar-cane imported from Madeira, but it declined in the middle of the 16^th century due to the strong competition from Brazil and the Caribbean, which could produce cheaper. The viticulture industry, which had its peak during the 16^th century, collapsed at the beginning of the 18^th century due to a locust plague and mildew attacks, which destroyed the vineyards.

From about 1830 to 1870 the cochineal production boomed throughout the islands, promising a better future also to the poorer population. Yet this dream did not last very long, the development of synthetic dyes causing a considerable decrease of the cochineal industry.

The archipelago’s economy was saved when around 1850 the industrial cultivation of bananas was introduced on the islands. It gradually gained in importance and became the islands’ main export product, reaching its peak in the beginning of the 20^th century. Yet again, a strong competition with foreign exports, this time from Latin American countries, made survival on the monoculture of bananas hopeless and local farmers were forced to diversification with cultivation of tomatoes, potatoes, other vegetables and exotic fruits.

Meanwhile bananas are protected on the Spanish market against foreign suppliers, but their cultivation has become uneconomic due to high costs and water shortage. Tomatoes are grown on a large scale mainly for exports between November and April. In recent years the cultivation of flowers and plants for export has also developed to a growing industry. Cereals must be imported to a large extent.

As on all the other bigger islands of the archipelago, Gran Canaria’s economy is based with an 80 per cent income mainly on the tourism industry, after which follow agricultural exports (tomatoes, bananas, tobacco) and – on a much smaller scale – you will find here also some manufacturing of embroidery, pottery and baskets.