Guernsey
Financial services - banking, fund management, insurance -
account for about 23% of employment and about 55% of total income in
this tiny, prosperous Channel Island economy. Tourism,
manufacturing, and horticulture, mainly tomatoes and cut flowers,
have been declining. Financial services, construction, retail, and
the public sector have been growing. Light tax and death duties make
Guernsey a popular tax haven. The evolving economic integration of
the EU nations is changing the environment under which Guernsey
operates.
Guinea
Guinea is a poor country that possesses major mineral,
hydropower, and agricultural resources. The country has almost half
of the world's bauxite reserves. The mining sector accounts for more
than 70% of exports. Long-run improvements in the management of the
economy, literacy, and the legal framework are needed if the country
is to move out of poverty. Investor confidence has been sapped by
rampant corruption, a lack of electricity and other infrastructure,
a lack of skilled workers, and the political uncertainty resulting
from the death of President Lansana CONTE in December 2008.
International donors, including the G-8, the IMF, and the World
Bank, cut their development programming significantly in response to
the coup, and international partners have said that a resumption of
aid will be contingent on a successful democratic transition with a
democratically elected president and a functioning National
Assembly. Growth rose slightly in 2006-08, primarily due to
increases in global demand and commodity prices on world markets,
but bauxite and alumina exports were negatively affected by the
global economic downturn and the economy in 2009 contracted.
International investors expressed renewed interest in Guinea's iron
ore mines in 2010.
Guinea-Bissau
One of the poorest countries in the world,
Guinea-Bissau's legal economy depends mainly on farming and fishing,
but trafficking narcotics is probably the most lucrative trade.
Cashew crops have increased remarkably in recent years.
Guinea-Bissau exports fish and seafood along with small amounts of
peanuts, palm kernels, and timber. Rice is the major crop and staple
food. However, intermittent fighting between Senegalese-backed
government troops and a military junta destroyed much of the
country's infrastructure and caused widespread damage to the economy
in 1998; the civil war led to a 28% drop in GDP that year, with
partial recovery in 1999-2002. In December 2003, the World Bank,
IMF, and UNDP were forced to step in to provide emergency budgetary
support in the amount of $107 million for 2004, representing over
80% of the total national budget. The combination of limited
economic prospects, a weak and faction-ridden government, and
favorable geography have made this West African country a way
station for drugs bound for Europe.
Guyana
The Guyanese economy exhibited moderate economic growth in
recent years and is based largely on agriculture and extractive
industries. The economy is heavily dependent upon the export of six
commodities - sugar, gold, bauxite, shrimp, timber, and rice - which
represent nearly 60% of the country's GDP and are highly susceptible
to adverse weather conditions and fluctuations in commodity prices.
Guyana's entrance into the Caricom Single Market and Economy (CSME)
in January 2006 has broadened the country's export market, primarily
in the raw materials sector. Economic recovery since a 2005
flood-related contraction was buoyed by increases in remittances and
foreign direct investment in the sugar and rice industries as well
as the mining sector. Chronic problems include a shortage of skilled
labor and a deficient infrastructure. The government is juggling a
sizable external debt against the urgent need for expanded public
investment. In March 2007, the Inter-American Development Bank,
Guyana's principal donor, canceled Guyana's nearly $470 million
debt, equivalent to nearly 48% of GDP, which along with other Highly
Indebted Poor Country (HIPC) debt forgiveness brought the
debt-to-GDP ratio down from 183% in 2006 to 120% in 2007. Guyana
became heavily indebted as a result of the inward-looking, state-led
development model pursued in the 1970s and 1980s. Growth slowed in
2009-10 as a result of the world recession. The slowdown in the
domestic economy and lower import costs helped to narrow the
country's current account deficit, despite generally lower earnings
from exports.
Haiti
Haiti's economy suffered a severe setback when a 7.1 magnitude
earthquake damaged its capital city, Port-au-Prince, in January
2010. Already the poorest country in the Western Hemisphere with 80%
of the population living under the poverty line and 54% in abject
poverty, the damage to Port-au-Prince caused the country's GDP to
contract an estimated 8% in 2010. Two-thirds of all Haitians depend
on the agricultural sector, mainly small-scale subsistence farming,
and remain vulnerable to damage from frequent natural disasters,
exacerbated by the country's widespread deforestation. US economic
engagement under the Haitian Hemispheric Opportunity through
Partnership Encouragement (HOPE) Act, passed in December 2006, has
boosted apparel exports and investment by providing tariff-free
access to the US. Congress voted in 2010 to extend the legislation
until 2020 under the Haitian Economic Lift Act (HELP); the apparel
sector accounts for three-quarters of Haitian exports and nearly
one-tenth of GDP. Remittances are the primary source of foreign
exchange, equaling nearly a quarter of GDP and more than twice the
earnings from exports. Haiti suffers from a lack of investment
because of insecurity and limited infrastructure, and a severe trade
deficit. In 2005, Haiti paid its arrears to the World Bank, paving
the way for reengagement with the Bank. Haiti received debt
forgiveness for over $1 billion of its debt through the
Highly-Indebted Poor Country (HIPC) initiative in 2009. The
remainder of its outstanding external debt was cancelled by donor
countries in early 2010 but has since climbed back to about $500
million. The government relies on formal international economic
assistance for fiscal sustainability.
Heard Island and McDonald Islands
The islands have no indigenous
economic activity, but the Australian Government allows limited
fishing in the surrounding waters.
Holy See (Vatican City)
The Holy See is supported financially by a
variety of sources, including investments, real estate income, and
donations from Catholic individuals, dioceses, and institutions;
these help fund the Roman Curia (Vatican bureaucracy), diplomatic
missions, and media outlets. The separate Vatican City State budget
includes the Vatican museums and post office and is supported
financially by the sale of stamps, coins, medals, and tourist
mementos; by fees for admission to museums; and by publications
sales. Moreover, an annual collection taken up in dioceses and
direct donations go to a non-budgetary fund known as Peter's Pence,
which is used directly by the Pope for charity, disaster relief, and
aid to churches in developing nations. The incomes and living
standards of lay workers are comparable to those of counterparts who
work in the city of Rome.
Honduras
Honduras, the second poorest country in Central America,
suffers from extraordinarily unequal distribution of income, as well
as high underemployment. While historically dependent on the export
of bananas and coffee, Honduras has diversified its export base to
include apparel and automobile wire harnessing. Nearly half of
Honduras's economic activity is directly tied to the US, with
exports to the US equivalent to 30% of GDP and remittances for
another 20%. The US-Central America Free Trade Agreement (CAFTA)
came into force in 2006 and has helped foster foriegn direct
investment, but physical and political insecurity may deter
potential investors; about 70% of FDI is from US firms. The economy
registered marginally positive economic growth in 2010, insufficient
to improve living standards for the nearly 60% of the population in
poverty. The LOBO administration inherited a difficult fiscal
position with off-budget debts accrued in previous administrations
and government salaries nearly equivalent to tax collections. His
government has displayed a commitment to improving tax collection
and cutting expenditures. This enabled Tegucigalpa to secure an IMF
Precautionary Stand-By agreement in October 2010. The IMF agreement
has helped renew multilateral and bilateral donor confidence in
Honduras following the ZELAYA administration's economic
mismanagement and the political coup.
Hong Kong Hong Kong has a free market economy highly dependent on international trade and finance - the value of goods and services trade, including the sizable share of re-exports, is about four times GDP. Hong Kong's open economy left it exposed to the global economic slowdown, but its increasing integration with China, through trade, tourism, and financial links, helped it recover more quickly than many observers anticipated. The Hong Kong government is promoting the Special Administrative Region (SAR) as the site for Chinese renminbi (RMB) internationalization. Hong Kong residents are allowed to establish RMB-denominated savings accounts; RMB-denominated corporate and Chinese government bonds have been issued in Hong Kong; and RMB trade settlement is allowed. The territory far exceeded the RMB conversion quota set by Beijing for trade settlements in 2010 due to the growth of earnings from exports to the mainland. RMB deposits grew to roughly 3.6% of total system deposits in Hong Kong by October 2010, an increase of over 250% since the beginning of the year. The government is pursuing efforts to introduce additional use of RMB in Hong Kong financial markets and is seeking to expand the RMB quota for 2011. The mainland has long been Hong Kong's largest trading partner, accounting for about half of Hong Kong's exports by value. Hong Kong's natural resources are limited, and food and raw materials must be imported. As a result of China's easing of travel restrictions, the number of mainland tourists to the territory has surged from 4.5 million in 2001 to 17.7 million in 2009, outnumbering visitors from all other countries combined. Hong Kong has also established itself as the premier stock market for Chinese firms seeking to list abroad. In 2009 mainland Chinese companies constituted about 40% of the firms listed on the Hong Kong Stock Exchange and accounted for 60% of the Exchange's market capitalization. During the past decade, as Hong Kong's manufacturing industry moved to the mainland, its service industry has grown rapidly and in 2009 accounted for more than 90% of the territory's GDP. GDP growth averaged a strong 4% from 1989 to 2008. Hong Kong's GDP fell in 2009 as a result of the global financial crisis, but a recovery began in third quarter 2009, and the economy grew nearly 6% in 2010. The Hong Kong government adopted several temporary fiscal policy support measures in response to the crisis that it may discontinue if strong growth is sustained. Credit expansion and tight housing supply conditions caused Hong Kong property prices to rise rapidly in 2010, and some lower income segments of the population are increasingly unable to afford adequate housing. Hong Kong continues to link its currency closely to the US dollar, maintaining an arrangement established in 1983.
Hungary
Hungary has made the transition from a centrally planned to
a market economy, with a per capita income nearly two-thirds that of
the EU-25 average. The private sector accounts for more than 80% of
GDP. Foreign ownership of and investment in Hungarian firms are
widespread, with cumulative foreign direct investment worth more
than $70 billion. The government's austerity measures, imposed since
late 2006, have reduced the budget deficit from over 9% of GDP in
2006 to 3.8% in 2010. Hungary's impending inability to service its
short-term debt - brought on by the global financial crisis in late
2008 - led Budapest to obtain an IMF-arranged financial assistance
package worth over $25 billion. The global economic downturn,
declining exports, and low domestic consumption and fixed asset
accumulation, dampened by government austerity measures, resulted in
an economic contraction of 6.3% in 2009. The economy rebounded in
2010 with a big boost from exports, and growth of more than 2.5% is
expected in 2011. Unemployment remained high, at more than 11%.