Gaza Strip
High population density, limited land access, and strict
internal and external security controls have kept economic
conditions in the Gaza Strip - the smaller of the two areas under
the Palestinian Authority (PA)- even more degraded than in the West
Bank. The beginning of the second intifadah in September 2000
sparked an economic downturn, largely the result of Israeli closure
policies; these policies, which were imposed to address security
concerns in Israel, disrupted labor and trade access to and from the
Gaza Strip. In 2001, and even more severely in 2003, Israeli
military measures in PA areas resulted in the destruction of
capital, the disruption of administrative structures, and widespread
business closures. The Israeli withdrawal from the Gaza Strip in
September 2005 offered some medium-term opportunities for economic
growth, which have not yet been realized due to Israeli military
activities in the Gaza Strip in 2006, continued crossings closures,
and the international community's financial embargo of the PA after
HAMAS took office in March 2006.
Georgia
Georgia's main economic activities include the cultivation
of agricultural products such as grapes, citrus fruits, and
hazelnuts; mining of manganese and copper; and output of a small
industrial sector producing alcoholic and nonalcoholic beverages,
metals, machinery, and chemicals. The country imports the bulk of
its energy needs, including natural gas and oil products. It has
sizeable but underdeveloped hydropower capacity. Despite the severe
damage the economy has suffered due to civil strife, Georgia, with
the help of the IMF and World Bank, has made substantial economic
gains since 2000, achieving positive GDP growth and curtailing
inflation. Georgia had suffered from a chronic failure to collect
tax revenues; however, the new government is making progress and has
reformed the tax code, improved tax administration, increased tax
enforcement, and cracked down on corruption. In addition, the
reinvigorated privatization process has met with success,
supplementing government expenditures on infrastructure, defense,
and poverty reduction. Despite customs and financial (tax)
enforcement improvements, smuggling is a drain on the economy.
Georgia also suffers from energy shortages due to aging and badly
maintained infrastructure, as well as poor management. Due to
concerted reform efforts, collection rates have improved
considerably to roughly 60%, both in T'bilisi and throughout the
regions. Continued reform in the management of state-owned power
entities is essential to successful privatization and onward
sustainability in this sector. The country is pinning its hopes for
long-term growth on its role as a transit state for pipelines and
trade. The construction on the Baku-T'bilisi-Ceyhan oil pipeline and
the Baku-T'bilisi-Erzerum gas pipeline have brought much-needed
investment and job opportunities. Nevertheless, high energy prices
have compounded the pressure on the country's inefficient energy
sector. Restructuring the sector and finding energy supply
alternatives to Russia remain major challenges.
Germany
Germany's affluent and technologically powerful economy -
the fifth largest in the world - has become one of the slowest
growing economies in the euro zone. A quick turnaround is not in the
offing in the foreseeable future; however, stronger growth this year
has improved employment considerably. Growth in 2001-03 fell short
of 1%, rising to 1.7% in 2004, falling back to 0.9% in 2005, and
increasing to 2.2% in 2006. Unemployment fell to 7.1% in October
2006, based on the Internation Labor Organization's measurement. The
modernization and integration of the eastern German economy
continues to be a costly long-term process, with annual transfers
from west to east amounting to roughly $70 billion. Germany's aging
population, combined with high chronic unemployment, has pushed
social security outlays to a level exceeding contributions from
workers. Structural rigidities in the labor market - including
strict regulations on laying off workers and the setting of wages on
a national basis - and a lack of competition in the sevice sectors
have made slow growth a chronic problem. Corporate restructuring and
growing capital markets are setting the foundations that could help
Germany meet the long-term challenges of European economic
integration and globalization; however, the current government has
failed to pass meaningful economic reform that would improve growth
prospects. Higher government revenues from the cyclical upturn in
2006 reduced Germany's budget deficit to within the EU's 3% debt
limit.
Ghana
Well endowed with natural resources, Ghana has roughly twice
the per capita output of the poorest countries in West Africa. Even
so, Ghana remains heavily dependent on international financial and
technical assistance. Gold, timber, and cocoa production are major
sources of foreign exchange. The domestic economy continues to
revolve around subsistence agriculture, which accounts for 34% of
GDP and employs 60% of the work force, mainly small landholders.
Ghana opted for debt relief under the Heavily Indebted Poor Country
(HIPC) program in 2002, but was included in a G-8 debt relief
program decided upon at the Gleneagles Summit in July 2005.
Priorities under its current $38 million Poverty Reduction and
Growth Facility (PRGF) include tighter monetary and fiscal policies,
accelerated privatization, and improvement of social services.
Receipts from the gold sector helped sustain GDP growth in 2006
along with record high prices for Ghana's largest cocoa crop to
date. Ghana received a Millennium Challenge Corporation (MCC) grant
in 2006, which aims to assist in transforming Ghana's agricultural
export sector.
Gibraltar
Self-sufficient Gibraltar benefits from an extensive
shipping trade, offshore banking, and its position as an
international conference center. The British military presence has
been sharply reduced and now contributes about 7% to the local
economy, compared with 60% in 1984. The financial sector, tourism
(almost 5 million visitors in 1998), shipping services fees, and
duties on consumer goods also generate revenue. The financial
sector, the shipping sector, and tourism each contribute 25%-30% of
GDP. Telecommunications accounts for another 10%. In recent years,
Gibraltar has seen major structural change from a public to a
private sector economy, but changes in government spending still
have a major impact on the level of employment.
Glorioso Islands
no economic activity
Greece
Greece has a capitalist economy with the public sector
accounting for about 40% of GDP and with per capita GDP at least 75%
of the leading euro-zone economies. Tourism provides 15% of GDP.
Immigrants make up nearly one-fifth of the work force, mainly in
menial jobs. Greece is a major beneficiary of EU aid, equal to about
3.3% of annual GDP. The Greek economy grew by nearly 4.0% per year
between 2003 and 2006, largely because of an investment boom and
infrastructure upgrades for the 2004 Athens Olympic Games. Greece
has not met the EU's Growth and Stability Pact budget deficit
criteria of 3% of GDP since 2000. Public debt, inflation, and
unemployment are above the euro-zone average. To overcome these
challenges, the Greek Government is expected to continue cutting
government spending, reducing the size of the public sector, and
reforming the labor and pension systems, despite vocal opposition
from the country's powerful labor unions and the general public.
Greenland
The economy remains critically dependent on exports of
fish and substantial support from the Danish Government, which
supplies about half of government revenues. The public sector,
including publicly-owned enterprises and the municipalities, plays
the dominant role in the economy. Despite several interesting
hydrocarbon and mineral exploration activities, it will take a
number of years before production can materialize. Tourism is the
only sector offering any near-term potential, and even this is
limited due to a short season and high costs.
Grenada
Grenada relies on tourism as its main source of foreign
exchange, especially since the construction of an international
airport in 1985. Strong performances in construction and
manufacturing, together with the development of an offshore
financial industry, have also contributed to growth in national
output.
Guam
The economy depends largely on US military spending and
tourism. Total US grants, wage payments, and procurement outlays
amounted to $1.3 billion in 2004. Over the past 30 years, the
tourist industry has grown to become the largest income source
following national defense. The Guam economy continues to experience
expansion in both its tourism and military sectors.