In this chapter, the economic performance of Guadeloupe and Martinique is compared with their Caribbean neighbours. Such a comparison makes it possible to assess the developmental policies implemented in these countries since the end of the colonial era. What factors led to relative prosperity, and which policy changes are most promising in improving economic performance? It is argued that for both the French dependent territories and the independent countries institutional reform is a necessary condition for more harmonious development. In the case of the French territories, the failure of institutions takes the form of cumbersome bureaucracies that hinder their potential. Reforms require the simplification of the governance structures and the economic regulation of markets. In the case of the independent countries, progress lies in the deepening of the integration movement. New institutions will be required to reach higher levels of technical competence and a degree of sustainable economic development than possible on an individual basis.