Kenyahuman rights groups; labor unions; Muslim organizations;National Convention Executive Council or NCEC, a proreform coalitionof political parties and nongovernment organizations [KivuthaKIBWANA]; Protestant National Council of Churches of Kenya or NCCK[Mutava MUSYIMI]; Roman Catholic and other Christian churches;Supreme Council of Kenya Muslims or SUPKEM [Shaykh Abdul Gafural-BUSAIDY]
KiribatiNA
Korea, Northnone
Korea, SouthFederation of Korean Industries; Federation of KoreanTrade Unions; Korean Confederation of Trade Unions; Korean NationalCouncil of Churches; Korean Traders Association; Korean Veterans'Association; National Council of Labor Unions; National DemocraticAlliance of Korea; National Federation of Farmers' Associations;National Federation of Student Associations
Kuwaitseveral political groups act as de facto parties: Bedouins,merchants, Sunni and Shi'a activists, and secular leftists andnationalists
KyrgyzstanCouncil of Free Trade Unions; Kyrgyz Committee on HumanRights [Ramazan DYRYLDAYEV]; National Unity Democratic Movement;Union of Entrepreneurs
Laosnoncommunist political groups proscribed; most oppositionleaders fled the country in 1975
LatviaHeadquarters for the Protection of Russian Schools (SHTAB)[Aleksandr KAZAKOV]
LebanonNA
LesothoNA
LiberiaNA
Libyavarious Arab nationalist movements with almost negligiblememberships may be functioning clandestinely, as well as someIslamic elements; an anti-QADHAFI Libyan exile movement exists,primarily based in London, but has little influence
LiechtensteinNA
LithuaniaNA
LuxembourgABBL (bankers' association); ALEBA (financial sectortrade union); Centrale Paysanne (federation of agriculturalproducers); CEP (professional sector chamber); CGFP (trade unionrepresenting civil service); Chambre de Commerce (Chamber ofCommerce); Chambre des Metiers (Chamber of Artisans); FEDIL(federation of industrialists); LCGP (center-right trade union);OGBL (center-left trade union)
MacauCatholic Church [LAI Hung-sing, bishop]; Macau Society ofTourism and Entertainment or STDM [Stanley HO, managing director];Union for Democracy Development [Antonio NG Kuok-cheong, leader]
MacedoniaCivic Movement of Macedonia [Gordana SILJANOVSKA];Movement for Macedonia's Euro-Atlantic Integration [Dosta DIMOVSKA]
MadagascarCommittee for the Defense of Truth and Justice or KMMR;Committee for National Reconciliation or CRN [Albert Zafy]; NationalCouncil of Christian Churches or FFKM
MalawiNA
MalaysiaNA
Maldivesnone
MaliPatriotic Movement of the Ghanda Koye or MPGK; United Movementand Fronts of Azawad or MFUA
MaltaNA
Man, Isle ofnone
Marshall IslandsNA
MartiniqueCaribbean Revolutionary Alliance or ARC; Central Unionfor Martinique Workers or CSTM [Marc PULVAR]; Frantz Fanon Circle;League of Workers and Peasants; Proletarian Action Group or GAP
MauritaniaArab nationalists; Ba'athists; General Confederation ofMauritanian Workers or CGTM [Abdallahi Ould MOHAMED, secretarygeneral]; Independent Confederation of Mauritanian Workers or CLTM[Samory Ould BEYE]; Islamists; Mauritanian Workers Union or UTM[Mohamed Ely Ould BRAHIM, secretary general]
Mauritiusvarious labor unions
MayotteNA
MexicoConfederation of Employers of the Mexican Republic orCOPARMEX; Confederation of Industrial Chambers or CONCAMIN;Confederation of Mexican Workers or CTM; Confederation of NationalChambers of Commerce or CONCANACO; Coordinator for Foreign TradeBusiness Organizations or COECE; Federation of Unions ProvidingGoods and Services or FESEBES; National Chamber of TransformationIndustries or CANACINTRA; National Peasant Confederation or CNC;National Union of Workers or UNT; Regional Confederation of MexicanWorkers or CROM; Revolutionary Confederation of Workers and Peasantsor CROC; Roman Catholic Church
MoldovaNA
MonacoNA
MongoliaNA
MontserratNA
MoroccoDemocratic Confederation of Labor or CDT [Noubir AMAOUI];General Union of Moroccan Workers or UGTM [Abderrazzak AFILAL];Moroccan Employers Association or CGEM [Hassan CHAMI]; NationalLabor Union of Morocco or UNMT [Abdelslam MAATI]; Union of MoroccanWorkers or UMT [Mahjoub BENSEDDIK]
MozambiqueInstitute for Peace and Democracy (Instituto para Paz eDemocracia) or IPADE [Raul DOMINGOS, president]; Etica [Abdul CARIMOIssa, chairman]; Movement for Peace and Citizenship (Movimento paraPaz e Cidadania); Mozambican League of Human Rights (LigaMocambicana dos Direitos Humanos) or LDH [Alice MABOTE, president];Human Rights and Development (Direitos Humanos e Desenvolvimento) orDHD [Artemisia FRANCO, secretary general]
NamibiaNA
NauruNA
NepalMaoist guerrilla-based insurgency [Pushpa Kamal DAHAL, alsoknown as PRAHANDA, chairman; Dr. Baburam BHATTARAI, from CommunistParty of Nepal/Maoist, chief negotiator]; numerous small,left-leaning student groups in the capital; several small, radicalNepalese antimonarchist groups
NetherlandsNetherlands Trade Union Federation (FNV) (consisting ofa merger of Socialist and Catholic trade unions); Christian TradeUnion Federation (CNV); Trade Union Federation of Middle and HighPersonnel (MHP); Federation of Catholic and Protestant EmployersAssociations; Interchurch Peace Council or IKV; large multinationalfirms; the nondenominational Federation of Netherlands Enterprises
Netherlands AntillesNA
New CaledoniaNA
New ZealandNA
NicaraguaNational Workers Front or FNT is a Sandinista umbrellagroup of eight labor unions including - Farm Workers Association orATC, Health Workers Federation or FETASALUD, Heroes and MartyrsConfederation of Professional Associations or CONAPRO, NationalAssociation of Educators of Nicaragua or ANDEN, National Union ofEmployees or UNE, National Union of Farmers and Ranchers or UNAG,Sandinista Workers Central or CST, and Union of Journalists ofNicaragua or UPN; Permanent Congress of Workers or CPT is anumbrella group of four non-Sandinista labor unions including -Autonomous Nicaraguan Workers Central or CTN-A, Confederation ofLabor Unification or CUS, Independent General Confederation of Laboror CGT-I, and Labor Action and Unity Central or CAUS; NicaraguanWorkers' Central or CTN is an independent labor union; SuperiorCouncil of Private Enterprise or COSEP is a confederation ofbusiness groups
NigerNA
NigeriaNigerian Labor Congress or NLC [Adams OSHIOMOLE]
NiueNA
Norfolk Islandnone
Northern Mariana IslandsNA
NorwayNA
Omannone
Pakistanmilitary remains most important political force; ulema(clergy), landowners, industrialists, and small merchants alsoinfluential
PalauNA
PanamaChamber of Commerce; National Civic Crusade; National Councilof Organized Workers or CONATO; National Union of Construction andSimilar Workers (SUNTRACS); National Council of Private Enterpriseor CONEP; Panamanian Association of Business Executives or APEDE;Panamanian Industrialists Society or SIP; Workers Confederation ofthe Republic of Panama or CTRP
Papua New GuineaNA
ParaguayAhorristas Estafados or AE; Coordinating Table of NationalCampesino Organizations or MCNOC; National Federation of Campesinosor FNC; National Workers Central or CNT; Paraguayan WorkersConfederation or CPT; Roman Catholic Church; Unitary Workers Centralor CUT;;
Peruleftist guerrilla groups include Shining Path [Abimael GUZMANReynoso (imprisoned), Gabriel MACARIO (top leader at-large)]; TupacAmaru Revolutionary Movement or MRTA [Victor POLAY (imprisoned),Hugo AVALLENEDA Valdez (top leader at-large)]
PhilippinesAKBAYAN [Reps. Etta ROSALES, Mario AGUJA, and RisaHONTIVEROS-BARAQUIEL]; ANAKPAWIS [Reps. Crispin BELTRAN and RafaelMARIANO]; Association of Philippine Electric Cooperatives (APEC)[Reps. Edgar VALDEZ, Ernesto PABLO, and Sunny Rose MADAMBA]; BayanMuna [Reps. Satur OCAMPO, Joel VIRADOR, and Teodoro CASINO, Jr.];BUHAY [Reps. Rene VELARDE and Hans Christian SENERES]; BUTIL [Rep.Benjamin CRUZ]; CIBAC [Rep. Emmanuel Joel VILLANUEVA]; GABRIELA[Rep. Liza MAZA}; PARTIDO NG MANGGAGAWA [Rep. Renato MAGTUBO] (2003)
Pitcairn Islandsnone
PolandAll Poland Trade Union Alliance or OPZZ (trade union) [MaciejMANICKI]; Roman Catholic Church [Cardinal Jozef GLEMP]; SolidarityTrade Union [Janusz SNIADEK]
PortugalNA
Puerto RicoArmed Forces for National Liberation or FALN; ArmedForces of Popular Resistance; Boricua Popular Army (also known asthe Macheteros); Volunteers of the Puerto Rican Revolution
Qatarnone
ReunionNA
Romaniavarious human rights and professional associations
RussiaNA
RwandaIBUKA - association of genocide survivors
Saint Helenanone
Saint Kitts and NevisNA
Saint LuciaNA
Saint Pierre and MiquelonNA
Saint Vincent and the GrenadinesNA
SamoaNA
San MarinoNA
Sao Tome and PrincipeNA
Saudi Arabianone
Senegallabor; Muslim brotherhoods; students; teachers
Serbia and MontenegroPolitical Council for Presevo, Medvedja andBujanovac or PCPMB [leader NA]; Group for Changes of Montenegro orGZP [Nebojsa MEDOJEVIC]
SeychellesRoman Catholic Church; trade unions
Sierra LeoneTrade Unions and Student Unions
SingaporeNA
SlovakiaAssociation of Employers of Slovakia; Association of Townsand Villages or ZMOS; Confederation of Trade Unions or KOZ; MetalWorkers Unions or KOVO and METALURG
SloveniaNA
Solomon IslandsNA
Somalianumerous clan and subclan factions are currently vying forpower
South AfricaCongress of South African Trade Unions or COSATU[Zwelinzima VAVI, general secretary]; South African Communist Partyor SACP [Blade NZIMANDE, general secretary]; South African NationalCivics Organization or SANCO [Mlungisi HLONGWANE, nationalpresident]; note - COSATU and SACP are in a formal alliance with theANC
Spainbusiness and landowning interests; Catholic Church; free laborunions (authorized in April 1977); Socialist General Union ofWorkers or UGT and the smaller independent Workers Syndical Union orUSO; university students; Workers Confederation or CC.OO; Nunca Mas(Galician for "Never Again"; formed in response to the oil tankerPrestige oil spill)
Sri LankaBuddhist clergy; labor unions; Liberation Tigers of TamilEelam or LTTE [Velupillai PRABHAKARAN](insurgent group fighting fora separate state); radical chauvinist Sinhalese groups such as theNational Movement Against Terrorism; Sinhalese Buddhist lay groups
SudanDemocratic Unionist Party [Muhammed Uthman AL-MIRGHANI];National Congress Party [Ibrahim Ahmed UMAR]; National DemocraticAlliance [Muhammed Uthman AL-MIRGHANI, chairman]; Sudan People'sLiberation Movement/Army [Dr. John GARANG]; Umma Party [Sadiqal-MAHDI]
SurinameGeneral Liberation and Development Party or ABOP [RonnieBRUNSWIJK]; Mandela Bushnegro Liberation Movement [Leendert ADAMS];Tucayana Amazonica [Alex JUBITANA, Thomas SABAJO]; Union forLiberation and Democracy [Kofi AFONGPONG]
SwazilandNA
SwedenNA
SwitzerlandNA
Syriaconservative religious leaders; Kurdish Democratic Alliance[leader NA]; Kurdish Democratic Front [lader NA]; Muslim Brotherhood(operates in exile in London) [Ali Badr Eddine al-BAYANOUNI];National Democratic Front [Hassan Abd al-AZIM]
TaiwanTaiwan independence movement, various business andenvironmental groupsnote: debate on Taiwan independence has become acceptable within themainstream of domestic politics on Taiwan; political liberalizationand the increased representation of opposition parties in Taiwan'slegislature have opened public debate on the island's nationalidentity; a broad popular consensus has developed that Taiwancurrently enjoys de facto independence and - whatever the ultimateoutcome regarding reunification or independence - that Taiwan'speople must have the deciding voice; advocates of Taiwanindependence oppose the stand that the island will eventually unifywith mainland China; goals of the Taiwan independence movementinclude establishing a sovereign nation on Taiwan and entering theUN; other organizations supporting Taiwan independence include theWorld United Formosans for Independence and the Organization forTaiwan Nation Building
Tajikistanthere are three unregistered political parties: AgrarianParty or APT [Hikmatullo Nasriddinov]; Progressive Party [SultonQUVVATOV]; Unity Party [Hikmatullo SAIDOV]
TanzaniaNA
ThailandNA
TogoNA
Tokelaunone
TongaHuman Rights and Democracy Movement Tonga or HRDMT [Rev.Simote VEA, chair]
Trinidad and TobagoJamaat-al Muslimeen [Yasin BAKR]
Tunisiathe Islamic fundamentalist party, Al Nahda (Renaissance), isoutlawed
TurkeyConfederation of Public Sector Unions or KESK [Sami EVREN];Confederation of Revolutionary Workers Unions or DISK [SuleymanCELEBI]; Independent Industrialists' and Businessmen's Associationor MUSIAD [Omer BOLAT]; Moral Rights Workers Union or Hak-Is [SalimUSLU]; Turkish Industrialists' and Businessmen's Association orTUSIAD [Omer SABANCI]; Turkish Confederation of Employers' Unions orTISK [Refik BAYDUR]; Turkish Confederation of Labor or Turk-Is[Salih KILIC]; Turkish Confederation of Tradesmen and Craftsmen orTESK [Dervis GUNDAY]; Turkish Union of Chambers of Commerce andCommodity Exchanges or TOBB [M. Rifat HISARCIKLIOGLU]
TurkmenistanNA
Turks and Caicos IslandsNA
Tuvalunone
UgandaPopular Resistance Against a Life President or PRALP
UkraineNA
United Arab EmiratesNA
United KingdomCampaign for Nuclear Disarmament; Confederation ofBritish Industry; National Farmers' Union; Trades Union Congress
United StatesNA
UruguayAgrupacion UTE (powerful state worker's union), RuralAssociation of Uruguay (rancher's association), UruguayanConstruction League, Chamber of Uruguayan Industries (manufacturer'sassociation), Chemist and Pharmaceutical Association (professionalorganization), Architect's Society of Uruguay (professionalorganization), the Catholic Church, students
UzbekistanAgrarian and Entrepreneurs' Party [Marat ZAHIDOV]; Birlik(Unity) Movement [Abdurakhim POLAT, chairman]; Erk (Freedom)Democratic Party [Muhammad SOLIH, chairman] was banned 9 December1992; Ezgulik Human Rights Society [Vasilia INOYATOVA]; FreeFarmers' Party or Ozod Dehqonlar [Nigara KHIDOYATOVA]; Human RightsSociety of Uzbekistan [Tolib YAKUBOV, chairman]; Independent HumanRights Society of Uzbekistan [Mikhail ARDZINOV, chairman]; Mazlum[leader NA]
VanuatuNA
VenezuelaFEDECAMARAS, a conservative business group; VECINOSgroups; Venezuelan Confederation of Workers or CTV (labororganization dominated by the Democratic Action)
Vietnamnone
Virgin IslandsNA
Wallis and FutunaNA
Western Saharanone
YemenNA
ZambiaNA
ZimbabweNational Constitutional Assembly or NCA [Lovemore MADHUKU];Crisis in Zimbabwe Coalition [Brian KAGORO]; Zimbabwe Congress ofTrade Unions or ZCTU [Lovemore MATOMBO]
This page was last updated on 10 February, 2005
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@2116 Economy - overview
AfghanistanAfghanistan's economic outlook has improvedsignificantly over the past two years because of the infusion ofover $2 billion in international assistance, dramatic improvementsin agricultural production, and the end of a four-year drought inmost of the country. However, Afghanistan remains extremely poor,landlocked, and highly dependent on foreign aid, farming, and tradewith neighboring countries. It will probably take the remainder ofthe decade and continuing donor aid and attention to raiseAfghanistan's living standards up from its current status among thelowest in the world. Much of the population continues to suffer fromshortages of housing, clean water, electricity, medical care, andjobs, but the Afghan government and international donors remaincommitted to improving access to these basic necessities byprioritizing infrastructure development, education, housingdevelopment, jobs programs, and economic reform over the next year.Growing political stability and continued international commitmentto Afghan reconstruction create an optimistic outlook formaintaining improvements to the Afghan economy in 2004. Thereplacement of the opium trade - which may account for one-third ofGDP - is one of several potential spoilers for the economy over thelong term.
AkrotiriEconomic activity is limited to providing services to themilitary and their families located in Akrotiri. All food andmanufactured goods must be imported.
AlbaniaPoor and backward by European standards, Albania is makingthe difficult transition to a more modern open-market economy. Thegovernment has taken measures to curb violent crime and to spureconomic activity and trade. The economy is bolstered by remittancesfrom abroad of $400-$600 million annually, mostly from Greece andItaly; this helps offset the sizable trade deficit. Agriculture,which accounts for one-half of GDP, is held back because of frequentdrought and the need to modernize equipment and consolidate smallplots of land. Severe energy shortages and antiquated and inadequateinfrastructure make it difficult to attract and sustain foreigninvestment. The government plans to boost energy imports to relievethe shortages and is moving slowly to improve the poor national roadand rail network, a long-standing barrier to sustained economicgrowth.
AlgeriaThe hydrocarbons sector is the backbone of the economy,accounting for roughly 60% of budget revenues, 30% of GDP, and over95% of export earnings. Algeria has the seventh-largest reserves ofnatural gas in the world and is the second-largest gas exporter; itranks 14th in oil reserves. Economic policy reforms supported by theIMF and debt rescheduling from the Paris Club in the past decadehave helped improve Algeria's financial and macroeconomicindicators. Because of sustained high oil prices in the past threeyears, Algeria's finances have further benefited from substantialtrade surpluses and record foreign exchange reserves. Real GDP hasrisen due to higher oil output and increased government spending.The government's continued efforts to diversify the economy byattracting foreign and domestic investment outside the energysector, however, has had little success in reducing highunemployment and improving living standards. Structural reformwithin the economy moves ahead slowly.
American SamoaThis is a traditional Polynesian economy in whichmore than 90% of the land is communally owned. Economic activity isstrongly linked to the US, with which American Samoa conducts mostof its foreign trade. Tuna fishing and tuna processing plants arethe backbone of the private sector, with canned tuna the primaryexport. Transfers from the US Government add substantially toAmerican Samoa's economic well-being. Attempts by the government todevelop a larger and broader economy are restrained by Samoa'sremote location, its limited transportation, and its devastatinghurricanes. Tourism is a promising developing sector.
AndorraTourism, the mainstay of Andorra's tiny, well-to-do economy,accounts for roughly 80% of GDP. An estimated 9 million touristsvisit annually, attracted by Andorra's duty-free status and by itssummer and winter resorts. Andorra's comparative advantage hasrecently eroded as the economies of neighboring France and Spainhave been opened up, providing broader availability of goods andlower tariffs. The banking sector, with its "tax haven" status, alsocontributes substantially to the economy. Agricultural production islimited - only 2% of the land is arable - and most food has to beimported. The principal livestock activity is sheep raising.Manufacturing output consists mainly of cigarettes, cigars, andfurniture. Andorra is a member of the EU Customs Union and istreated as an EU member for trade in manufactured goods (no tariffs)and as a non-EU member for agricultural products.
AngolaAngola has been an economy in disarray because of a quartercentury of nearly continuous warfare. An apparently durable peacewas established after the death of rebel leader Jonas SAVIMBI onFebruary 22, 2002, but consequences from the conflict continueincluding the impact of wide-spread land mines. Subsistenceagriculture provides the main livelihood for 85% of the population.Oil production and the supporting activities are vital to theeconomy, contributing about 45% to GDP and more than half ofexports. Much of the country's food must still be imported. To fullytake advantage of its rich natural resources - gold, diamonds,extensive forests, Atlantic fisheries, and large oil deposits -Angola will need to continue reforming government policies and toreduce corruption. While Angola made progress in bringing inflationdown further, from 325% in 2000 to about 106% in 2002, thegovernment has failed to make sufficient progress on reformsrecommended by the IMF such as increasing foreign exchange reservesand promoting greater transparency in government spending. Increasedoil production supported 7% GDP growth in 2003.
AnguillaAnguilla has few natural resources, and the economy dependsheavily on luxury tourism, offshore banking, lobster fishing, andremittances from emigrants. Increased activity in the tourismindustry, which has spurred the growth of the construction sector,has contributed to economic growth. Anguillan officials have putsubstantial effort into developing the offshore financial sector,which is small, but growing. In the medium term, prospects for theeconomy will depend largely on the tourism sector and, therefore, onrevived income growth in the industrialized nations as well as onfavorable weather conditions.
AntarcticaFishing off the coast and tourism, both based abroad,account for the limited economic activity. Antarctic fisheries in2000-01 (1 July-30 June) reported landing 112,934 metric tons.Unregulated fishing, particularly of Patagonian toothfish, is aserious problem. The Convention on the Conservation of AntarcticMarine Living Resources determines the recommended catch limits formarine species. A total of 13,571 tourists visited in the 2002-03antarctic summer, up from the 11,588 who visited the previous year.Nearly all of them were passengers on commercial (nongovernmental)ships and several yachts that make trips during the summer. Mosttourist trips last approximately two weeks.
Antigua and BarbudaTourism continues to dominate the economy,accounting for more than half of GDP. Weak tourist arrival numberssince early 2000 have slowed the economy, however, and pressed thegovernment into a tight fiscal corner. The dual-island nation'sagricultural production is focused on the domestic market andconstrained by a limited water supply and a labor shortage stemmingfrom the lure of higher wages in tourism and construction.Manufacturing comprises enclave-type assembly for export with majorproducts being bedding, handicrafts, and electronic components.Prospects for economic growth in the medium term will continue todepend on income growth in the industrialized world, especially inthe US, which accounts for slightly more than one-third of touristarrivals.
Arctic OceanEconomic activity is limited to the exploitation ofnatural resources, including petroleum, natural gas, fish, and seals.
ArgentinaArgentina benefits from rich natural resources, a highlyliterate population, an export-oriented agricultural sector, and adiversified industrial base. Over the past decade, however, thecountry has suffered recurring economic problems of inflation,external debt, capital flight, and budget deficits. Growth in 2000was a negative 0.8%, as both domestic and foreign investors remainedskeptical of the government's ability to pay debts and maintain thepeso's fixed exchange rate with the US dollar. The economicsituation worsened in 2001 with the widening of spreads on Argentinebonds, massive withdrawals from the banks, and a further decline inconsumer and investor confidence. Government efforts to achieve a"zero deficit," to stabilize the banking system, and to restoreeconomic growth proved inadequate in the face of the mountingeconomic problems. The peso's peg to the dollar was abandoned inJanuary 2002, and the peso was floated in February; the exchangerate plunged and inflation picked up rapidly, but by mid-2002 theeconomy had stabilized, albeit at a lower level. Strong demand forthe peso compelled the Central Bank to intervene in foreign exchangemarkets to curb its appreciation in 2003. Led by record exports, theeconomy began to recover with output up 8% in 2003, unemploymentfalling, and inflation reduced to under 4% at year-end.
ArmeniaUnder the old Soviet central planning system, Armenia haddeveloped a modern industrial sector, supplying machine tools,textiles, and other manufactured goods to sister republics inexchange for raw materials and energy. Since the implosion of theUSSR in December 1991, Armenia has switched to small-scaleagriculture away from the large agroindustrial complexes of theSoviet era. The agricultural sector has long-term needs for moreinvestment and updated technology. The privatization of industry hasbeen at a slower pace, but has been given renewed emphasis by thecurrent administration. Armenia is a food importer, and its mineraldeposits (copper, gold, bauxite) are small. The ongoing conflictwith Azerbaijan over the ethnic Armenian-dominated region ofNagorno-Karabakh and the breakup of the centrally directed economicsystem of the former Soviet Union contributed to a severe economicdecline in the early 1990s. By 1994, however, the ArmenianGovernment had launched an ambitious IMF-sponsored economicliberalization program that resulted in positive growth rates in1995-2003. Armenia joined the WTrO in January 2003. Armenia also hasmanaged to slash inflation, stabilize the local currency (the dram),and privatize most small- and medium-sized enterprises. The chronicenergy shortages Armenia suffered in the early and mid-1990s havebeen offset by the energy supplied by one of its nuclear powerplants at Metsamor. Armenia is now a net energy exporter, althoughit does not have sufficient generating capacity to replace Metsamor,which is under international pressure to close. The electricitydistribution system was privatized in 2002. Armenia's severe tradeimbalance has been offset somewhat by international aid and foreigndirect investment. Economic ties with Russia remain close,especially in the energy sector.
ArubaTourism is the mainstay of the small, open Aruban economy,with offshore banking and oil refining and storage also important.The rapid growth of the tourism sector over the last decade hasresulted in a substantial expansion of other activities.Construction has boomed, with hotel capacity five times the 1985level. In addition, the reopening of the country's oil refinery in1993, a major source of employment and foreign exchange earnings,has further spurred growth. Aruba's small labor force and lowunemployment rate have led to a large number of unfilled jobvacancies, despite sharp rises in wage rates in recent years.Tourist arrivals have declined in the aftermath of the 11 September2001 terrorist attacks on the US. The government now must deal witha budget deficit and a negative trade balance.
Ashmore and Cartier Islandsno economic activity
Atlantic OceanThe Atlantic Ocean provides some of the world's mostheavily trafficked sea routes, between and within the Eastern andWestern Hemispheres. Other economic activity includes theexploitation of natural resources, e.g., fishing, the dredging ofaragonite sands (The Bahamas), and production of crude oil andnatural gas (Caribbean Sea, Gulf of Mexico, and North Sea).
AustraliaAustralia has an enviable Western-style capitalisteconomy, with a per capita GDP on par with the four dominant WestEuropean economies. Rising output in the domestic economy has beenoffsetting the global slump, and business and consumer confidenceremains robust. Australia's emphasis on reforms, low inflation, andgrowing ties with China are other key factors behind the economy'sstrength. The impact of drought, weak foreign demand, and strongimport demand pushed the trade deficit up to $18 billion in 2003 andto $20 billion in 2004 from $8 billion in 2002. One other concern isthe domestic housing bubble.
AustriaAustria, with its well-developed market economy and highstandard of living, is closely tied to other EU economies,especially Germany's. Membership in the EU has drawn an influx offoreign investors attracted by Austria's access to the singleEuropean market and proximity to EU aspirant economies. Slow growthin Germany and elsewhere in the world held the economy to 0.7%growth in 2001, 1.4% in 2002, and again less than 1% in 2003.However, recent data signal that the recovery has started. Thegovernment estimates economic growth in 2004 of 1.7-2.1% and of 2.5%in 2005. The government is planning a EURO 500 billion income taxcut in 2004, though some economists doubt it will have stimulativeeffects in 2004, because it will be offset by higher healthinsurance contributions and higher taxes on energy. For 2005,Austria plans a tax cut of EURO 2.5 billion and harmonization of thevarious pension schemes. To meet increased competition from both EUand Central European countries, particularly the new EU members,Austria will need to emphasize knowledge-based sectors of theeconomy, continue to deregulate the service sector, and lower itstax burden. A key issue is the encouragement of much greaterparticipation in the labor market by its aging population.
AzerbaijanAzerbaijan's number one export is oil. Azerbaijan's oilproduction declined through 1997 but has registered an increaseevery year since. Negotiation of production-sharing arrangements(PSAs) with foreign firms, which have thus far committed $60 billionto long-term oilfield development, should generate the funds neededto spur future industrial development. Oil production under thefirst of these PSAs, with the Azerbaijan International OperatingCompany, began in November 1997. Azerbaijan shares all theformidable problems of the former Soviet republics in making thetransition from a command to a market economy, but its considerableenergy resources brighten its long-term prospects. Baku has onlyrecently begun making progress on economic reform, and old economicties and structures are slowly being replaced. One obstacle toeconomic progress is the need for stepped up foreign investment inthe non-energy sector. A second obstacle is the continuing conflictwith Armenia over the Nagorno-Karabakh region. Trade with Russia andthe other former Soviet republics is declining in importance whiletrade is building with Turkey and the nations of Europe. Long-termprospects will depend on world oil prices, the location of newpipelines in the region, and Azerbaijan's ability to manage its oilwealth.
Bahamas, TheThe Bahamas is a stable, developing nation with aneconomy heavily dependent on tourism and offshore banking. Tourismalone accounts for more than 60% of GDP and directly or indirectlyemploys half of the archipelago's labor force. Steady growth intourism receipts and a boom in construction of new hotels, resorts,and residences had led to solid GDP growth in recent years, but theslowdown in the US economy and the attacks of 11 September 2001 heldback growth in these sectors in 2001-03. Financial servicesconstitute the second-most important sector of the Bahamian economy,accounting for about 15% of GDP. However, since December 2000, whenthe government enacted new regulations on the financial sector, manyinternational businesses have left The Bahamas. Manufacturing andagriculture together contribute approximately a tenth of GDP andshow little growth, despite government incentives aimed at thosesectors. Overall growth prospects in the short run rest heavily onthe fortunes of the tourism sector, which depends on growth in theUS, the source of more than 80% of the visitors. In addition totourism and banking, the government supports the development of a"third pillar," e-commerce.
BahrainIn well-to-do Bahrain, petroleum production and refiningaccount for about 60% of export receipts, 60% of governmentrevenues, and 30% of GDP. With its highly developed communicationand transport facilities, Bahrain is home to numerous multinationalfirms with business in the Gulf. Bahrain is dependent on SaudiArabia for oil granted as aid. A large share of exports consist ofpetroleum products made from refining imported crude. Constructionproceeds on several major industrial projects. Unemployment,especially among the young, and the depletion of oil and undergroundwater resources are major long-term economic problems.
Baker Islandno economic activity
BangladeshDespite sustained domestic and international efforts toimprove economic and demographic prospects, Bangladesh remains apoor, overpopulated, and ill-governed nation. Although half of GDPis generated through the service sector, nearly two-thirds ofBangladeshis are employed in the agriculture sector, with rice asthe single-most-important product. Major impediments to growthinclude frequent cyclones and floods, inefficient state-ownedenterprises, inadequate port facilities, a rapidly growing laborforce that cannot be absorbed by agriculture, delays in exploitingenergy resources (natural gas), insufficient power supplies, andslow implementation of economic reforms. Economic reform is stalledin many instances by political infighting and corruption at alllevels of government. Progress also has been blocked by oppositionfrom the bureaucracy, public sector unions, and other vestedinterest groups. The BNP government, led by Prime Minister KhaledaZIA, has the parliamentary strength to push through needed reforms,but the party's political will to do so has been lacking in keyareas. One encouraging note: growth has been a steady 5% for thepast several years.
BarbadosHistorically, the Barbadian economy had been dependent onsugarcane cultivation and related activities, but production inrecent years has diversified into light industry and tourism.Offshore finance and information services are important foreignexchange earners. The government continues its efforts to reduceunemployment, to encourage direct foreign investment, and toprivatize remaining state-owned enterprises. The economy contractedin 2002-03 mainly due to a decline in tourism. Growth should bepositive in 2004, the precise level largely dependent on economicconditions in the US and Europe.
Bassas da Indiano economic activity
BelarusBelarus' economy in 2003 posted 6.1 percent growth and islikely to continue expanding through 2004, albeit at a slower growthrate. The Belarusian economy in 2004 is likely to be hampered byhigh inflation, persistent trade deficits, and ongoing rockyrelations with Russia, Belarus' largest trading partner and energysupplier. Belarus has seen little structural reform since 1995, whenPresident LUKASHENKO launched the country on the path of "marketsocialism." In keeping with this policy, LUKASHENKO reimposedadministrative controls over prices and currency exchange rates andexpanded the state's right to intervene in the management of privateenterprises. In addition, businesses have been subject to pressureon the part of central and local governments, e.g., arbitrarychanges in regulations, numerous rigorous inspections, retroactiveapplication of new business regulations, and arrests of "disruptive"businessmen and factory owners. A wide range of redistributivepolicies has helped those at the bottom of the ladder. For the timebeing, Belarus remains self-isolated from the West and itsopen-market economies.
BelgiumThis modern private enterprise economy has capitalized onits central geographic location, highly developed transport network,and diversified industrial and commercial base. Industry isconcentrated mainly in the populous Flemish area in the north. Withfew natural resources, Belgium must import substantial quantities ofraw materials and export a large volume of manufactures, making itseconomy unusually dependent on the state of world markets. Roughlythree-quarters of its trade is with other EU countries. Public debtis about 100% of GDP, and the government has succeeded in balancingits budget. Belgium, together with 11 of its EU partners, begancirculating the euro currency in January 2002. Economic growth in2001-03 dropped sharply because of the global economic slowdown.Prospects for 2004 again depend largely on recovery in the EU andthe US.
BelizeIn this small, essentially private enterprise economy thetourism industry is the number one foreign exchange earner followedby cane sugar, citrus, marine products, bananas, and garments. Thegovernment's expansionary monetary and fiscal policies, initiated inSeptember 1998, led to GDP growth of 6.5% in 1999, 10.8% in 2000,4.6% in 2001, and 3.7% in 2002. Major concerns continue to be thesizable trade deficit and foreign debt. A key short-term objectiveremains the reduction of poverty with the help of internationaldonors.
BeninThe economy of Benin remains underdeveloped and dependent onsubsistence agriculture, cotton production, and regional trade.Growth in real output has averaged a stable 5% in the past sixyears, but rapid population rise has offset much of this increase.Inflation has subsided over the past several years. In order toraise growth still further, Benin plans to attract more foreigninvestment, place more emphasis on tourism, facilitate thedevelopment of new food processing systems and agriculturalproducts, and encourage new information and communicationtechnology. The 2001 privatization policy should continue intelecommunications, water, electricity, and agriculture in spite ofinitial government reluctance. The Paris Club and bilateralcreditors have eased the external debt situation, while pressing forspeeded-up structural reforms.
BermudaBermuda enjoys one of the highest per capita incomes in theworld, equal to that of the US. Its economy is primarily based onproviding financial services for international business and luxuryfacilities for tourists. The effects of 11 September 2001 have hadboth positive and negative ramifications for Bermuda. On thepositive side, a number of new reinsurance companies have located onthe island, contributing to the expansion of an already robustinternational business sector. On the negative side, Bermuda'stourism industry - which derives over 80% of its visitors from theUS - was severely hit as American tourists chose not to travel.Tourism rebounded somewhat in 2002-03. Most capital equipment andfood must be imported. Bermuda's industrial sector is small,although construction continues to be important; the average cost ofa house in June 2003 had risen to $976,000. Agriculture is limited,only 6% of the land being arable.
BhutanThe economy, one of the world's smallest and least developed,is based on agriculture and forestry, which provide the mainlivelihood for more than 90% of the population. Agriculture consistslargely of subsistence farming and animal husbandry. Ruggedmountains dominate the terrain and make the building of roads andother infrastructure difficult and expensive. The economy is closelyaligned with India's through strong trade and monetary links anddependence on India's financial assistance. The industrial sector istechnologically backward, with most production of the cottageindustry type. Most development projects, such as road construction,rely on Indian migrant labor. Bhutan's hydropower potential and itsattraction for tourists are key resources. Model education, social,and environment programs are underway with support from multilateraldevelopment organizations. Each economic program takes into accountthe government's desire to protect the country's environment andcultural traditions. For example, the government in its cautiousexpansion of the tourist sector encourages the visits of upscale,environmentally conscientious visitors. Detailed controls anduncertain policies in areas like industrial licensing, trade, labor,and finance continue to hamper foreign investment.
BoliviaBolivia, long one of the poorest and least developed LatinAmerican countries, made considerable progress in the 1990s towardthe development of a market-oriented economy. Successes underPresident SANCHEZ DE LOZADA (1993-97) included the signing of a freetrade agreement with Mexico and becoming an associate member of theSouthern Cone Common Market (Mercosur), as well as the privatizationof the state airline, telephone company, railroad, electric powercompany, and oil company. Growth slowed in 1999, in part due totight government budget policies, which limited neededappropriations for anti-poverty programs, and the fallout from theAsian financial crisis. In 2000, major civil disturbances held downgrowth to 2.5%. Bolivia's GDP failed to grow in 2001 due to theglobal slowdown and laggard domestic activity. Growth picked upslightly in 2002, but the first quarter of 2003 saw extensive civilriots and looting and loss of confidence in the government. Boliviawill remain highly dependent on foreign aid unless and until it candevelop its substantial natural resources.
Bosnia and HerzegovinaBosnia and Herzegovina ranked next to TheFormer Yugoslav Republic of Macedonia as the poorest republic in theold Yugoslav federation. Although agriculture is almost all inprivate hands, farms are small and inefficient, and the republictraditionally is a net importer of food. Industry has been greatlyoverstaffed, one reflection of the socialist economic structure ofYugoslavia. TITO had pushed the development of military industriesin the republic with the result that Bosnia hosted a number ofYugoslavia's defense plants. The interethnic warfare in Bosniacaused production to plummet by 80% from 1992 to 1995 andunemployment to soar. With an uneasy peace in place, outputrecovered in 1996-99 at high percentage rates from a low base; butoutput growth slowed in 2000-02. Part of the lag in output was madeup in 2003-04. National-level statistics are limited. Moreover,official data do not capture the large share of black marketactivity. The konvertibilna marka (convertible mark or BAM)- thenational currency introduced in 1998 - is now pegged to the euro,and the Central Bank of Bosnia and Herzegovina has dramaticallyincreased its reserve holdings. Implementation of privatization,however, has been slow, and local entities only reluctantly supportnational-level institutions. Banking reform accelerated in 2001 asall the Communist-era payments bureaus were shut down. The countryreceives substantial amounts of reconstruction assistance andhumanitarian aid from the international community but will have toprepare for an era of declining assistance.
BotswanaBotswana has maintained one of the world's highest growthrates since independence in 1966. Through fiscal discipline andsound management, Botswana has transformed itself from one of thepoorest countries in the world to a middle-income country with a percapita GDP of $8,800 in 2003. Two major investment services rankBotswana as the best credit risk in Africa. Diamond mining hasfueled much of the expansion and currently accounts for more thanone-third of GDP and for nine-tenths of export earnings. Tourism,subsistence farming, and cattle raising are other key sectors. Onthe downside, the government must deal with high rates ofunemployment and poverty. Unemployment officially is 21%, butunofficial estimates place it closer to 40%. HIV/AIDS infectionrates are the highest in the world and threaten Botswana'simpressive economic gains. Long-term prospects are overshadowed bythe expected leveling off in diamond mining production.
Bouvet Islandno economic activity; declared a nature reserve
BrazilPossessing large and well-developed agricultural, mining,manufacturing, and service sectors, Brazil's economy outweighs thatof all other South American countries and is expanding its presencein world markets. From 2001-03 real wages fell and Brazil's economygrew, on average, only 1.1% per year, as the country absorbed aseries of domestic and international economic shocks. That Brazilabsorbed these shocks without financial collapse is a tribute to theresiliency of the Brazilian economy and the economic program put inplace by former President CARDOSO and strengthened by President LulaDA SILVA. The three pillars of the economic program are a floatingexchange rate, an inflation-targeting regime, and tight fiscalpolicy, which have been reinforced by a series of IMF programs. Thecurrency depreciated sharply in 2001 and 2002, which contributed toa dramatic current account adjustment: in 2003, Brazil ran a recordtrade surplus and recorded the first current account surplus since1992. While economic management has been good, there remainimportant economic vulnerabilities. The most significant aredebt-related: the government's largely domestic debt increasedsteadily from 1994 to 2003, straining government finances, whileBrazil's foreign debt (a mix of private and public debt) is large inrelation to Brazil's modest (but growing) export base. Anotherchallenge is maintaining economic growth over a period of time togenerate employment and make the government debt burden moremanageable.
British Indian Ocean Territory All economic activity is concentrated on the largest island of Diego Garcia, where joint UK-US defense facilities are located. Construction projects and various services needed to support the military installations are done by military and contract employees from the UK, Mauritius, the Philippines, and the US. There are no industrial or agricultural activities on the islands. When the Ilois return, they plan to reestablish sugarcane production and fishing.
British Virgin IslandsThe economy, one of the most stable andprosperous in the Caribbean, is highly dependent on tourism,generating an estimated 45% of the national income. An estimated350,000 tourists, mainly from the US, visited the islands in 1998.Tourism suffered in 2002 because of the lackluster US economy. Inthe mid-1980s, the government began offering offshore registrationto companies wishing to incorporate in the islands, andincorporation fees now generate substantial revenues. Roughly400,000 companies were on the offshore registry by yearend 2000. Theadoption of a comprehensive insurance law in late 1994, whichprovides a blanket of confidentiality with regulated statutorygateways for investigation of criminal offenses, is expected to makethe British Virgin Islands even more attractive to internationalbusiness. Livestock raising is the most important agriculturalactivity; poor soils limit the islands' ability to meet domesticfood requirements. Because of traditionally close links with the USVirgin Islands, the British Virgin Islands has used the dollar asits currency since 1959.
BruneiThis small, wealthy economy encompasses a mixture of foreignand domestic entrepreneurship, government regulation, welfaremeasures, and village tradition. Crude oil and natural gasproduction account for nearly half of GDP. Per capita GDP is farabove most other Third World countries, and substantial income fromoverseas investment supplements income from domestic production. Thegovernment provides for all medical services and subsidizes rice andhousing. Brunei's leaders are concerned that steadily increasedintegration in the world economy will undermine internal socialcohesion, although it became a more prominent player by serving aschairman for the 2000 APEC (Asian Pacific Economic Cooperation)forum. Plans for the future include upgrading the labor force,reducing unemployment, strengthening the banking and touristsectors, and, in general, further widening the economic base beyondoil and gas.
BulgariaBulgaria, a former communist country striving to enter theEuropean Union, has experienced macroeconomic stability and stronggrowth since a major economic downturn in 1996 led to the fall ofthe then socialist government. As a result, the government becamecommitted to economic reform and responsible fiscal planning. A $300million stand-by agreement negotiated with the IMF at the end of2001 has supported government efforts to overcome high rates ofpoverty and unemployment.
Burkina FasoOne of the poorest countries in the world, landlockedBurkina Faso has few natural resources, a fragile soil, and a highlyunequal distribution of income. About 90% of the population isengaged in (mainly subsistence) agriculture, which is vulnerable tovariations in rainfall. Cotton is the key crop. Industry remainsdominated by unprofitable government-controlled corporations.Following the African franc currency devaluation in January 1994 thegovernment updated its development program in conjunction withinternational agencies, and exports and economic growth haveincreased. Maintenance of macroeconomic progress depends oncontinued low inflation, reduction in the trade deficit, and reformsdesigned to encourage private investment. The internal crisis inneighboring Cote d'Ivoire continues to hurt trade and industrialprospects and deepens the need for international assistance.
BurmaBurma is a resource-rich country that suffers from governmentcontrols and abject rural poverty. The military regime took steps inthe early 1990s to liberalize the economy after decades of failureunder the "Burmese Way to Socialism", but those efforts have sincestalled. Burma has been unable to achieve monetary or fiscalstability, resulting in an economy that suffers from seriousmacroeconomic imbalances - including a steep inflation rate and anofficial exchange rate that overvalues the Burmese kyat by more than100 times the market rate. In addition, most overseas developmentassistance ceased after the junta suppressed the democracy movementin 1988 and subsequently ignored the results of the 1990 election. Acrisis in the private banking sector in early 2003 followed byeconomic moves against Burma by the United States, the EuropeanUnion, and Japan - including a US ban on imports from Burma and aJapanese freeze on new bilateral economic aid - further weakened theBurmese economy. Burma is data poor, and official statistics areoften dated and inaccurate. Published estimates of Burma's foreigntrade are greatly understated because of the size of the blackmarket and border trade - often estimated to be one to two times theofficial economy. Better relations with foreign countries andrelaxed controls at home are needed to promote foreign investment,exports, and tourism. In February 2003, a major banking crisis hitthe country's 20 private banks, shutting them down and disruptingthe economy. In July and August 2003, the United States imposed aban on all Burmese imports and a ban on provision of financialservices, hampering Burma's ability to obtain foreign exchange. Asof January 2004, the largest private banks remained moribund,leaving the private sector with little formal access to creditoutside of government contracts.
BurundiBurundi is a landlocked, resource-poor country with anunderdeveloped manufacturing sector. The economy is predominantlyagricultural with roughly 90% of the population dependent onsubsistence agriculture. Economic growth depends on coffee and teaexports, which account for 90% of foreign exchange earnings. Theability to pay for imports, therefore, rests primarily on weatherconditions and international coffee and tea prices. The Tutsiminority, 14% of the population, dominates the government and thecoffee trade at the expense of the Hutu majority, 85% of thepopulation. Since October 1993 an ethnic-based war has resulted inmore than 200,000 deaths, forced 800,000 refugees into Tanzania, anddisplaced 525,000 others internally. Doubts about the prospects forsustainable peace continue to impede development. Only one in twochildren go to school, and approximately one in ten adults hasHIV/AIDS. Food, medicine, and electricity remain in short supply.
CambodiaCambodia's economy slowed dramatically in 1997-1998 due tothe regional economic crisis, civil violence, and politicalinfighting. Foreign investment and tourism fell off. In 1999, thefirst full year of peace in 30 years, progress was made on economicreforms. Growth resumed and has remained about 5.0% during2000-2003. Tourism was Cambodia's fastest growing industry, witharrivals up 34% in 2000 and up another 40% in 2001 before the 11September 2001 terrorist attacks in the US. Cambodia expects 1million foreign tourists in 2004. Economic growth has been largelydriven by expansion in the clothing sector and tourism. Clothingexports were fostered by the U.S.-Cambodian Bilateral TextileAgreement signed in 1999. Even given Cambodia's recent growth, thelong-term development of the economy after decades of war remains adaunting challenge. The population lacks education and productiveskills, particularly in the poverty-ridden countryside, whichsuffers from an almost total lack of basic infrastructure. Fear ofrenewed political instability and a dysfunctional legal systemcoupled with government corruption discourage foreign investment.The Cambodian government continues to work with bilateral andmultilateral donors to address the country's many pressing needs.The major economic challenge for Cambodia over the next decade willbe fashioning an economic environment in which the private sectorcan create enough jobs to handle Cambodia's demographic imbalance.About 60% of the population is 20 years or younger; most of thesecitizens will seek to enter the workforce over the course of thenext 10 years.
CameroonBecause of its oil resources and favorable agriculturalconditions, Cameroon has one of the best-endowed primary commodityeconomies in sub-Saharan Africa. Still, it faces many of the seriousproblems facing other underdeveloped countries, such as a top-heavycivil service and a generally unfavorable climate for businessenterprise. Since 1990, the government has embarked on various IMFand World Bank programs designed to spur business investment,increase efficiency in agriculture, improve trade, and recapitalizethe nation's banks. In June 2000, the government completed anIMF-sponsored, three-year structural adjustment program; however,the IMF is pressing for more reforms, including increased budgettransparency, privatization, and poverty reduction programs.International oil and cocoa prices have considerable impact on theeconomy.
CanadaAs an affluent, high-tech industrial society, Canada todayclosely resembles the US in its market-oriented economic system,pattern of production, and high living standards. Since World WarII, the impressive growth of the manufacturing, mining, and servicesectors has transformed the nation from a largely rural economy intoone primarily industrial and urban. The 1989 US-Canada Free TradeAgreement (FTA) and the 1994 North American Free Trade Agreement(NAFTA) (which includes Mexico) touched off a dramatic increase intrade and economic integration with the US. As a result of the closecross-border relationship, the economic sluggishness in the UnitedStates in 2001-02 had a negative impact on the Canadian economy.Real growth averaged nearly 3% during 1993-2000, but declined in2001, with moderate recovery in 2002-03. Unemployment is up, withcontraction in the manufacturing and natural resource sectors.Nevertheless, given its great natural resources, skilled laborforce, and modern capital plant Canada enjoys solid economicprospects. Solid fiscal management has produced a long-term budgetsurplus which is substantially reducing the national debt, althoughpublic debate continues over how to manage the rising cost of thepublicly funded healthcare system. Trade accounts for roughly athird of GDP. Canada enjoys a substantial trade surplus with itsprincipal trading partner, the United States, which absorbs morethan 85% of Canadian exports. Roughly 90% of the population liveswithin 160 kilometers of the US border.
Cape VerdeThis island economy suffers from a poor natural resourcebase, including serious water shortages exacerbated by cycles oflong-term drought. The economy is service-oriented, with commerce,transport, tourism, and public services accounting for 72% of GDP.Although nearly 70% of the population lives in rural areas, theshare of agriculture in GDP in 2001 was only 11%, of which fishingaccounted for 1.5%. About 82% of food must be imported. The fishingpotential, mostly lobster and tuna, is not fully exploited. CapeVerde annually runs a high trade deficit, financed by foreign aidand remittances from emigrants; remittances supplement GDP by morethan 20%. Economic reforms are aimed at developing the privatesector and attracting foreign investment to diversify the economy.Prospects for 2004 depend heavily on the maintenance of aid flows,tourism, remittances, and the momentum of the government'sdevelopment program.
Cayman IslandsWith no direct taxation, the islands are a thrivingoffshore financial center. More than 40,000 companies wereregistered in the Cayman Islands as of 1998, including almost 600banks and trust companies; banking assets exceed $500 billion. Astock exchange was opened in 1997. Tourism is also a mainstay,accounting for about 70% of GDP and 75% of foreign currencyearnings. The tourist industry is aimed at the luxury market andcaters mainly to visitors from North America. Total tourist arrivalsexceeded 1.2 million in 1997, with 600,000 from the US. About 90% ofthe islands' food and consumer goods must be imported. TheCaymanians enjoy one of the highest outputs per capita and one ofthe highest standards of living in the world.
Central African RepublicSubsistence agriculture, together withforestry, remains the backbone of the economy of the Central AfricanRepublic (CAR), with more than 70% of the population living inoutlying areas. The agricultural sector generates half of GDP.Timber has accounted for about 16% of export earnings and thediamond industry for 54%. Important constraints to economicdevelopment include the CAR's landlocked position, a poortransportation system, a largely unskilled work force, and a legacyof misdirected macroeconomic policies. Factional fighting betweenthe government and its opponents remains a drag on economicrevitalization, with GDP likely to contract in 2004. Distribution ofincome is extraordinarily unequal. Grants from France and theinternational community can only partially meet humanitarian needs.
ChadChad's primarily agricultural economy will continue to beboosted by major oilfield and pipeline projects that began in 2000.Over 80% of Chad's population relies on subsistence farming andstock raising for its livelihood. Cotton, cattle, and gum arabicprovide the bulk of Chad's export earnings, but Chad will begin toexport oil in 2004. Chad's economy has long been handicapped by itslandlocked position, high energy costs, and a history ofinstability. Chad relies on foreign assistance and foreign capitalfor most public and private sector investment projects. A consortiumled by two US companies has been investing $3.7 billion to developoil reserves estimated at 1 billion barrels in southern Chad. Oilproduction came on stream in late 2003.
ChileChile has a market-oriented economy characterized by a highlevel of foreign trade. During the early 1990s, Chile's reputationas a role model for economic reform was strengthened when thedemocratic government of Patricio AYLWIN - which took over from themilitary in 1990 - deepened the economic reform initiated by themilitary government. Growth in real GDP averaged 8% during 1991-97,but fell to half that level in 1998 because of tight monetarypolicies implemented to keep the current account deficit in checkand because of lower export earnings - the latter a product of theglobal financial crisis. A severe drought exacerbated the recessionin 1999, reducing crop yields and causing hydroelectric shortfallsand electricity rationing, and Chile experienced negative economicgrowth for the first time in more than 15 years. Despite the effectsof the recession, Chile maintained its reputation for strongfinancial institutions and sound policy that have given it thestrongest sovereign bond rating in South America. By the end of1999, exports and economic activity had begun to recover, and growthrebounded to 4.2% in 2000. Growth fell back to 3.1% in 2001 and 2.1%in 2002, largely due to lackluster global growth and the devaluationof the Argentine peso, but recovered to 3.2% in 2003. Unemployment,although declining over the past year, remains stubbornly high,putting pressure on President LAGOS to improve living standards. Onebright spot was the signing of a free trade agreement with the US,which took effect on 1 January 2004. In 2004, GDP growth is set toaccelerate to more than 4% as copper prices rise, export earningsgrow, and foreign direct investment picks up.