Saint Helena's economy: the aid an airport was meant to end

How Saint Helena earned its living before the airport

For two centuries the money came from the ships that called. The history article follows the East India Company, whose homeward East Indiamen stopped at the island for water and provisions, about 1,000 ships a year in the peak era. The Company soon found that the island could not be made self-sufficient, and it went on subsidising the community because of where the island lay. Once steamships no longer needed the trade winds the traffic faded. A report of 2020 says the island's prosperity ended after 1869, when the Suez Canal shifted trade routes north, and the number of ships calling fell from 1,100 in 1855 to 288 in 1889.

Each withdrawal of British spending took income with it. The economy deteriorated after the naval station left in 1864 and again after the Liberated African Station closed ten years later, and when the garrison was withdrawn in 1906, growing sales of postage stamps made up only a little of what the soldiers had spent.

New Zealand flax carried the island for the next half century. A fibre industry re-established in 1907 earned considerable income in the First World War and again in the Second, and its prices peaked in 1951. The island's flax then cost substantially more delivered than the world price, synthetic fibres took its market, and the decision of the British Post Office, a major buyer, to make its mailbags from synthetics contributed to the closure of the mills in 1965. Stamps lasted longer: the George V ship design of 1922 to 1937, the first drawn by an islander, the postmaster Thomas R. Bruce, contributed significantly to revenue for several years.

Wages earned elsewhere became part of the income too. The first islanders left to work on Ascension in 1921, and a report of 2019 records that by the 1970s a majority of Saints were working abroad and sending money home. In 1974, after several years of losses, the government bought a majority share in Solomon and Company to avoid the economic effects of a closure. Solomons and Thorpes are the major private employers, and both work in almost every sector.

Why public money makes up most of the economy

The St Helena Government's statistics office estimated gross domestic product at £40.7 million for 2024/25, or £9,660 a head, after a real fall of 1.5% on the year before. Measured in 2024/25 prices, output has fallen every year since 2020/21, from £45.6 million to £40.7 million. The office calls the economy very small and asks for every figure to be treated as provisional.

Its bulletin of 27 July 2025 set that decline beside the population. From 2019/20 to 2023/24 real GDP fell 5.7%, while the average number of residents and visitors on the island fell 6.3%, from an estimated 4,563 to 4,277, so output per head rose only 0.4%, from £9,170 to £9,210 in 2023/24 prices.

Government work fills the largest lines of the accounts. In 2023/24 public administration produced 18.1% of value added, finance, insurance, information and communication 16.5%, and health and social work 15.5%, together just over half. Agriculture, forestry and fishing produced 2.1%, and accommodation and food service 1.7%. The office values the activities of government net of depreciation and everything else gross of it.

What the island receives from outside

The government's tourism strategy for December 2025 to March 2031 gives the island's receipts for 2018/19. Total receipts that year were £47.7 million. UK financial and capital aid made up 83.1% of them, and the export of services, meaning what tourists and other non-residents spent on the island, 11.9%. Goods exports came to £354,000 in 2019. Wikipedia's account of the economy gives the older split of the budget: in 2016-17 about £22.5 million of financial assistance from the United Kingdom supplemented £12.6 million raised from local taxes.

How London sets the size of the aid

The rules belong to the politics article, because the budget is settled in London. The National Audit Office described the mechanism in February 2025 as the gap between what the St Helena Government needs to deliver public services and the income it raises, mainly through taxes. In real terms aid rose from £27 million in 2015-16 to £33 million in 2023-24, almost £3 million a year of it covering the airport's shortfall, and the Foreign, Commonwealth and Development Office attributed part of the rise to health and social care for an ageing population, which cost £16.4 million in 2022-23.

The settlement announced on 8 April 2026 runs to March 2029. Core aid rises 4.8% to £37.51 million in 2026-27, from £35.79 million in 2025-26, then by 2% in each of the next two years, and £40 million over the three years goes to capital projects through the Economic Development Investment Programme, the bulk fuel infrastructure among them.

The money counts as Official Development Assistance because of the island's income. In July 2025 the statistics office estimated gross national income at $11,220 a head for 2023/24, below the World Bank's high-income threshold of $14,005 for that year.

What the airport was built to change

How the runway came to be paid for

The South African Air Force surveyed Prosperous Bay Plain from October 1943 to January 1944 and judged an airport technically feasible but not a practical proposition. A majority of islanders, at home and abroad, voted for one in January 2002, a project with an Italian contractor was suspended in November 2008 in the financial crisis, and the two governments decided to build in 2011.

The sources divide the money differently. The National Audit Office describes a £285.5 million contract signed in 2011 with the South African company Basil Read. Wikipedia's account of the airport gives Basil Read about £202 million for design and construction, adds up to £10 million of contingency and £35.1 million for ten years of operation, and puts the total cost at £285.5 million in April 2016.

The building work moved the island's own figures while it lasted. Dry Gut, a gorge, was raised by almost 100 metres with 8 million cubic metres of fill to carry part of the runway, and in September 2013 Basil Read's workers struck over conditions and wages, the island's first strike in half a century. The statistics office records that median wages, adjusted for inflation, rose substantially from 2012/13 to 2015/16 and fell back afterwards.

Why the flights came late and stayed few

Wind shear held up the opening. A Boeing 737-800 met it on two of its three approaches on 18 April 2016, and on 26 April the government announced an indefinite delay, which kept the RMS St Helena in service. Airlink began a weekly service from Johannesburg on 14 October 2017 with a smaller Embraer E190, about 17 months late by the National Audit Office's count, and runway limits first held it to 76 of the aircraft's 99 seats. The Royal Mail Ship left the island for the last time on 10 February 2018, after 268 voyages.

Commercial flights stopped in March 2020, when South Africa closed its airspace, and stayed stopped for two years. In February 2026 concerns over its fire tenders closed the airport and cancelled every flight until scheduled services resumed on 15 February.

What the business case expected and got

The National Audit Office reported on 12 February 2025 that the airport had not yet raised the island's self-generated income. It counted 2,112 visitors in 2023, fewer than the pre-pandemic peak and around a quarter of the 8,000 target for that year. The Foreign, Commonwealth and Development Office, which blames mainly the pandemic, accepted that its expected rise in tourists was over-optimistic and self-sufficiency unlikely within the original timeframe. The airport's income does not cover its costs, and the subsidy paid to the airline when flights are delayed, cancelled or unprofitable came to more than £800,000 between June 2023 and May 2024.

Private inward investment also fell short. Beside the airport the British government paid £8 million from 2012 to 2021 for Enterprise St Helena, which supported around 85 business start-ups, and £30 million of capital from 2018 to 2028 for economic development. The replacement bulk fuel installation was nine years overdue and unfinished when the report appeared, and by May 2020 £78 million had been spent on it against an original budget of £31 million.

How many visitors reach Saint Helena each year

Two counts circulate, and the National Audit Office's 2,112 visitors in 2023 is the smaller. The tourism strategy counts every arrival, Saints visiting friends and relatives, returning residents and business travellers included, and records 4,364 for 2023/24 and 5,008 for 2024/25, 99% of the 5,091 of 2018/19, which met the main aim of its recovery plan. Leisure arrivals alone were 1,057 in 2024/25, against 1,238 in 2019/20.

The statistics office estimates spending from exit surveys alone and prints it as a range, £4.9 to £6.7 million in 2024 against £4.8 to £6.6 million in 2019. The strategy's split for 2024 puts spending by people visiting friends and relatives at £2.2 to £3.0 million and by leisure visitors at £1.6 to £2.1 million. Spending per visit rose from £904 in 2019 to £978 in 2025, while the average stay of leisure visitors who are not Saints fell from 12.6 nights in 2019 to 11.9 in 2025.

Yachts brought 826 arrivals in 2024/25, a rise the strategy records after the 23 moorings under Ladder Hill Fort were closed on 5 January 2024 over worn ground chain.

What holds the numbers down

The strategy calls access the primary constraint. One airline serves the island, with one weekly flight from Johannesburg and a seasonal mid-week flight from Cape Town between December and February, and the nearest alternative runway is 800 miles away. The weekly cycle and the overnight stops in Johannesburg make the shortest trip at least nine nights before any travel to or from Europe. In 2024 weather delayed 18 of 78 scheduled flights, 23%, against an average of 13% from 2017 to 2024, and a delay can stretch to between 24 and 72 hours.

On the ground the limits are rooms and staff. An audit in October 2025 found 65 serviced rooms, one of the island's two dive operators closed in June 2025, and a population decline of about 10% through emigration had taken several key people out of the industry. December to March is the peak, when the weather is best and whale sharks aggregate around the island, and it carries 55% of annual arrivals. By 2031 the strategy aims for 6,325 arrivals a year, leisure arrivals growing 4% a year compounded, 90 registered serviced rooms, 50 more jobs in tourism and a peak share cut to 45%.

What Saint Helena sells to other countries

Goods exports came to £354,000 in 2019, and customs data for 2019-20 split them 83% fisheries and 17% coffee. The statistics office notes that spending by visitors far exceeds the value of goods exports, and its page on the economy calls visitor expenditure "St Helena's biggest export".

The fishery lands mostly tuna, under the motto "one pole, one line, one fish at a time", and some of its tuna has been served in restaurants in Cape Town. The government's Marine and Fisheries Conservation Section names yellowfin, bigeye and skipjack as the species important to commercial and recreational fishing. Under the Atlantic Ocean Tropical Tuna Tagging Programme, which the island joined in 2018, over 5,800 tags were put on them, and local fishers have deployed and recaptured them. Inshore, the brown spiny lobster that islanders call crayfish, the endemic red slipper lobster called stump and the rock hind grouper, known as jack, are all fished commercially. The waters around the island form a Marine Protected Area managed for sustainable use under IUCN Category 6.

The coffee goes back to Green Tipped Bourbon plants imported in 1733. London merchants Wm Burnie & Co described it in 1839 as of "very superior quality and flavour", coffee from the Bamboo Hedge Estate at Sandy Bay won a premier award at the Great Exhibition in 1851, and the Island of St Helena Coffee Company, founded by David Henry in 1994, grew crops from those plants on several sites.

A local distillery makes Tungi Spirit from the fruit of the prickly pear, which islanders call tungi, along with coffee liqueur, gin and rum, and beekeepers collect honey from bees that carry no parasites or disease. The island issues its own postage stamps, which bring in an income, and names under the .sh domain.

The Sustainable Economic Development Plan for 2018 to 2028 set out to "increase exports, and decrease imports" and named satellite ground stations and remote workers among its export sectors. The Equiano submarine cable, activated in 2023, brought unlimited data plans for the first time.

Why prices follow the rand and the pound

The Saint Helena pound has been the island's currency since 1976, held at parity with sterling and shared with Ascension, and British pounds are accepted alongside it. The government has issued its own banknotes since 1976 and circulating coins since 1984, and in January 2026 it announced a polymer series of £5, £10 and £20 notes showing Jonathan the tortoise and the St Helena ebony, with the older notes staying legal tender.

Because most goods in the island's shops come from South Africa or the United Kingdom, Wikipedia's account of the economy finds prices driven by inflation in those two countries, by the value of the Saint Helena pound against the rand, by freight costs and by import taxes. It notes that the rand weakened from around 17 to the pound in early 2019 to around 20 at the end of March 2020, which in some cases made South African goods cheaper.

Imports of goods cost £23.6 million in 2025/26, down from £30.7 million in 2024/25 and up from £19.3 million in 2018/19. Of that total, £11.7 million was bought in South Africa, £8.3 million in the United Kingdom and £3.6 million elsewhere, where diesel, petrol and specialised equipment are bought. Machinery and transport equipment came to £6.7 million of it and food to £4.8 million.

Consumer prices rose 2.7% in the year to the second quarter of 2026. Food, which carries 36.3% of the basket, rose 2.2%. Alcohol and tobacco rose 9.8% after the duty increases of 1 April 2026, and household energy 8.5%.

How freight reaches the island

Cargo comes by sea from Cape Town. In March 2024 MACS Maritime Carrier Shipping was running the government's contracted service, usually monthly, from Cape Town to Saint Helena and Ascension, landing at the island's sole wharf at Ruperts Bay, which was originally built for the airport's construction. Until 2017 the RMS St Helena lay offshore in James Bay about 30 times a year and passengers and freight went ashore in small boats; the ship could carry up to 92 standard twenty-foot containers, 17 of them refrigerated.

Where the island's electricity comes from

Connect Saint Helena Ltd generates and distributes the power, and in 2023 six diesel generators produced 80% of it. Twelve wind turbines stand on Deadwood Plain, first installed in the 1990s and added to in 2009 and 2014, but their output declined from 2014 to 2024 because of unreliable equipment and the difficulty of balancing the grid. Wind, a 500 kW solar farm and panels on four public buildings supply the remainder. With almost every unit of energy imported as diesel or oil, electricity cost £0.53 a kWh in 2024. A plan to expand solar and wind announced in 2016 never came to fruition, and a new target of 80% renewable electricity by 2027 was announced in 2024.

Why so many Saints work away from the island

The census of February 2016 counted 2,539 economically active people among 4,534 residents, and 76 who said they were unemployed. The census of 7 February 2021 found 4,439 residents, 4,114 of them St Helenian. In 2021, 60.6% of residents aged 16 and over who had finished compulsory schooling were economically active and 3.6% of the active workforce was unemployed, from 0.9% in Blue Hill to 5.7% in Jamestown. Longwood had 128 fewer residents than in 2016, because the foreign construction workers had left the camp at Bradley's when the airport was finished.

Half of full-time employees earned less than £11,250 in 2024/25, a quarter earned less than £9,240 and a quarter more than £14,920. Men earned on average £280 a year more than women, against a gap of £2,390 in 2013/14, when workers on the airport project were predominantly men. The figures leave out staff the government recruits overseas.

Since full British citizenship returned in 2002, emigration to Britain has accelerated and widened beyond the young workers on long-term contracts who once went to Ascension and the Falklands, drawn by higher wages and better prospects. By 2018 Swindon, in Wiltshire, held enough people from the island to earn the nickname "Swindolena".

Some of those who leave come back in later life. The 2021 census counted 1,087 St Helenians aged 65 or over, a quarter of all residents and 18% more than in 2016, and the statistics office put the rise down to longer lives and the return of islanders who had worked abroad when younger, typically in the United Kingdom, Ascension or the Falklands. The National Audit Office put the fall in population between 2016 and 2024 at 10%, to around 4,000.