This report presents the GIWA assessment of the Small Islands sub-system of the Caribbean Sea region - an area particularly vulnerable to human activities owing to the fragility of the island ecosystems and their limited carrying capacities. Habitat and community modification, as a result of anthropogenic pressures, was found to cause the most severe transboundary environmental and socio-economic impacts in the sub-system. The governments regard rapid economic growth as a priority, which they have failed to balance with the conservation and protection of important ecosystems. The Causal chain analysis discusses the root causes of habitat and community modification by investigating the cause-effect pathways of the concern. Policy options are proposed that aim to provide solutions to these fundamental issues, in order to enhance the management of the region's aquatic environment