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Economy ::Djibouti

Economy - overview:

The economy is based on service activities connected with the country's strategic location and status as a free trade zone in the Horn of Africa. Two-thirds of Djibouti's inhabitants live in the capital city; the remainder are mostly nomadic herders. Scanty rainfall limits crop production to fruits and vegetables, and most food must be imported. Djibouti provides services as both a transit port for the region and an international transshipment and refueling center. Imports and exports from landlocked neighbor Ethiopia represent 85% of port activity at Djibouti's container terminal. Djibouti has few natural resources and little industry. The nation is, therefore, heavily dependent on foreign assistance to help support its balance of payments and to finance development projects. An unemployment rate of nearly 60% in urban areas continues to be a major problem. While inflation is not a concern, due to the fixed tie of the Djiboutian franc to the US dollar, the artificially high value of the Djiboutian franc adversely affects Djibouti's balance of payments. Per capita consumption dropped an estimated 35% between 1999 and 2006 because of recession, civil war, and a high population growth rate (including immigrants and refugees). Faced with a multitude of economic difficulties, the government has fallen in arrears on long-term external debt and has been struggling to meet the stipulations of foreign aid donors.

GDP (purchasing power parity):

$1.891 billion (2008 est.) country comparison to the world: 184 $1.786 billion (2007 est.)

$1.696 billion (2006 est.)

note: data are in 2008 US dollars

GDP (official exchange rate):

$982 million (2008 est.)

GDP - real growth rate:

5.9% (2008 est.) country comparison to the world: 64 5.3% (2007 est.)

4.8% (2006 est.)

GDP - per capita (PPP):

$2,700 (2008 est.) country comparison to the world: 170 $2,600 (2007 est.)

$2,500 (2006 est.)

note: data are in 2008 US dollars

GDP - composition by sector:

agriculture: 3.2%

industry: 14.9%

services: 81.9% (2006 est.)

Labor force:

351,700 (2007) country comparison to the world: 156

Labor force - by occupation:

agriculture: NA%

industry: NA%

services: NA%

Unemployment rate:

59% (2007 est.) country comparison to the world: 194 note: data are for urban areas, 83% in rural areas

Population below poverty line:

42% (2007 est.)

Household income or consumption by percentage share:

lowest 10%: NA%

highest 10%: NA%

Budget:

revenues: $135 million

expenditures: $182 million (1999 est.)

Inflation rate (consumer prices):

5% (2007 est.) country comparison to the world: 85

Commercial bank prime lending rate:

The 2009 CIA World Factbook

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