Here’s something that’ll make you rethink everything you thought you knew about the digital economy: a Caribbean island smaller than Waiheke, with far fewer people than Whanganui, is raking in tens of millions annually from artificial intelligence—without a single AI company calling it home.
Sound impossible? Welcome to Anguilla’s accidental goldmine.
I stumbled onto this story while researching how small nations leverage digital assets, and honestly, it’s one of the most fascinating examples of economic serendipity you’d ever see. It’s also a masterclass in what governments should—and shouldn’t—do when fortune drops an opportunity in their lap.
Back in 1995, when most of us were still figuring out what email was, the Internet Assigned Numbers Authority was busy divvying up country code top-level domains. The United States got .us, the United Kingdom got .uk, and Anguilla—a British territory of 16,000 souls scattered across 35 square miles of Caribbean paradise—got .ai.
At the time, it meant nothing. Absolutely nothing.
For two decades, Anguilla plodded along doing what most Caribbean islands do: selling sun, sand, and crystal-clear waters to wealthy tourists. They earned a bit from domain registrations—maybe $3 million annually by 2018, representing about 5% of government revenue. Nice, but hardly transformative.
Then ChatGPT launched in November 2022.
Suddenly, every tech company, startup, and artificial intelligence wannabe on the planet needed a domain name ending in .ai. Google snapped up google.ai. Elon Musk grabbed x.ai for his Grok chatbot. AI search engine Perplexity operates at perplexity.ai. The rush was on.
And Anguilla? They owned the toll booth.
The numbers are staggering. In 2023 alone, domain registrations generated US$32 million—more than 20% of total government revenue. That’s up from 5% just a few years earlier. By 2024, that figure climbed to $37 million. Government projections suggest $54 million by 2027. We’re talking about exponential growth driven entirely by two letters that happened to match the abbreviation for artificial intelligence.
From 50,000 registered .ai domains in 2018, they’ve now got over 600,000. At roughly $200-$300NZD per two-year registration with renewal rates near 90%, it’s proven both lucrative and resilient.
Where’s the lesson for us?
When Tuvalu got assigned the .tv domain back in the 1990s, they did what many small nations do: they leased it to a big foreign company for 50 years. Tuvalu got a cut, sure, but most of the money flowed offshore. Classic colonialism in digital form.
Anguilla looked at that model and said, “Nah, we’re good.” They kept control locally. As Vince Cate, the software developer who manages their domain registrations, puts it: “The government is getting almost all the money. And that’s not what was happening in Tuvalu.”
That’s smart governance. When opportunity knocks, don’t hand the keys to someone else.
But here’s the thing that really impressed me: they’re not blowing the money on vanity projects or padding politicians’ wallets. The Anguillan government has committed to prudent fiscal management—paying down debt, investing in infrastructure that actually matters.
They’re expanding Clayton J Lloyd International Airport with a $175 million project that includes a new terminal and an extended runway. They’re providing free medical care for senior citizens. They’re building a vocational technology training centre at the local high school. They’re investing in sporting infrastructure for youth development. And they’re funding renewable energy projects and sustainable fishery initiatives.
In other words, they’re doing exactly what a windfall should enable: building long-term resilience and diversifying the economy.
Remember, this is an island that saw Hurricane Irma wipe out roughly 90% of its GDP in 2017. Tourism dependence had left them devastatingly vulnerable. The International Monetary Fund noted in a May 2024 report that the domain boom is “playing an important role in diversifying the economy, thus making it more resilient to external shocks.”
That’s the real story here—not just the money, but what they’re doing with it.
In January 2025, Anguilla partnered with Identity Digital, one of the world’s largest domain infrastructure providers, to handle technical operations while retaining ownership and revenue control. It’s a sensible move that ensures scalability and modern systems without surrendering the golden goose.
Recent innovations are sustaining growth too. Daily auctions of premium domains have generated over $600,000, with auctions now accounting for a 20% increase in gross weekly revenue. They’ve introduced DropZone, a platform for accessing expiring domains, creating additional revenue streams.
Ellis Webster, who served as Premier from 2020 until losing the general election in February 2025, acknowledged there’s an element of luck involved. “It could also have gone to nearby Antigua, which has the same letters in its name,” he told the Associated Press. Fair point. But luck alone doesn’t explain smart management.
There’s even an unexpected tourism bump. Government officials report that some visitors now discover Anguilla through its digital domain rather than traditional marketing. Talk about brand synergy you couldn’t buy!
The government expects revenue will eventually stabilise at around 15% of total income as the initial registration surge slows. That’s realistic planning—acknowledging that booms don’t last forever while maximising the current opportunity.
What stuns me the most is that Anguilla has no native AI industry. Zero. Zilch. They’re not Silicon Valley South. They haven’t trained thousands of computer scientists or built innovation hubs. They simply had the right two letters at the right time—and they didn’t stuff it up.
Compare that to how many governments squander natural resource windfalls or bungle digital opportunities. Anguilla’s getting it right.
In his interview with the Associated Press, Webster expressed hope that one day Anguilla might become a hub for artificial intelligence technology. That’s ambitious, perhaps overly so. But it shows the right mindset—using today’s windfall to build tomorrow’s opportunities. Webster also warned against over-reliance: “You can’t predict how long this is going to last. And so I don’t want to have our economy and our country and all our programmes just based on this.”
That’s prudent thinking. The boom might not last forever, but a smart investment today can create lasting benefits.
The broader lesson here applies well beyond small islands. In the digital economy, value can materialise from the most unexpected places. Geographic size doesn’t determine economic opportunity. Smart governance and local control matter more than natural resources. And when fortune smiles, don’t hand the proceeds to offshore consultants—invest in your people and infrastructure.
Anguilla’s story proves that even in our interconnected, globalised world, small can still be powerful. You just need the right two letters—and the sense not to give them away.
I’m hoping the Anguillian Government might send me there on a fact-finding mission. It looks beautiful!
Steve Baron is a New Zealand-based political commentator and author. He holds a BA with a double major in Economics and Political Science from the University of Waikato and an Honours Degree in Political Science from Victoria University of Wellington. A former businessman in the advertising industry, he founded the political lobby group Better Democracy NZ. https://stevebaron.co.nz