Puerto Rico
Puerto Rico has one of the most dynamic economies in the
Caribbean region. A diverse industrial sector has far surpassed
agriculture as the primary locus of economic activity and income.
Encouraged by duty-free access to the US and by tax incentives, US
firms have invested heavily in Puerto Rico since the 1950s. US
minimum wage laws apply. Sugar production has lost out to dairy
production and other livestock products as the main source of income
in the agricultural sector. Tourism has traditionally been an
important source of income with estimated arrivals of more than 3.6
million tourists in 2008.
Qatar
Despite the global financial crisis, Qatar has prospered in
the last several years - in 2010 Qatar had the world's highest
growth rate. Qatari authorities throughout the crisis sought to
protect the local banking sector with direct investments into
domestic banks. GDP rebounded in 2010 largely due to the increase in
oil prices. Economic policy is focused on developing Qatar's
nonassociated natural gas reserves and increasing private and
foreign investment in non-energy sectors, but oil and gas still
account for more than 50% of GDP, roughly 85% of export earnings,
and 70% of government revenues. Oil and gas have made Qatar the
second highest per-capita income country - following Liechtenstein -
and likely the country with the lowest unemployment. Proved oil
reserves of 15 billion barrels should enable continued output at
current levels for 37 years. Qatar's proved reserves of natural gas
exceed 25 trillion cubic meters, about 14% of the world total and
third largest in the world. Qatar's successful 2022 world cup bid
will likely accelerate large-scale infrastructure projects such as
Qatar's metro system and the Qatar-Bahrain causeway.
Romania
Romania, which joined the European Union on 1 January 2007,
began the transition from Communism in 1989 with a largely obsolete
industrial base and a pattern of output unsuited to the country's
needs. The country emerged in 2000 from a punishing three-year
recession thanks to strong demand in EU export markets. Domestic
consumption and investment have fueled strong GDP growth in recent
years, but have led to large current account imbalances. Romania's
macroeconomic gains have only recently started to spur creation of a
middle class and address Romania's widespread poverty. Corruption
and red tape continue to handicap its business environment.
Inflation rose in 2007-08, driven in part by strong consumer demand
and high wage growth, rising energy costs, a nation-wide drought
affecting food prices, and a relaxation of fiscal discipline.
Romania's GDP contracted markedly in the last quarter of 2008 as the
country began to feel the effects of a global downturn in financial
markets and trade, and GDP fell more than 7% in 2009, prompting
Bucharest to seek a $26 billion emergency assistance package from
the IMF, the EU, and other international lenders. Drastic austerity
measures, as part of Romania's IMF-led agreement led to a further
1.9% GDP contraction in 2010. The economy is expected to return to
positive growth in 2011.
Russia
Russia has undergone significant changes since the collapse
of the Soviet Union, moving from a globally-isolated,
centrally-planned economy to a more market-based and
globally-integrated economy. Economic reforms in the 1990s
privatized most industry, with notable exceptions in the energy and
defense-related sectors. The protection of property rights is still
weak and the private sector remains subject to heavy state
interference. Russian industry is primarily split between
globally-competitive commodity producers - in 2009 Russia was the
world's largest exporter of natural gas, the second largest exporter
of oil, and the third largest exporter of steel and primary aluminum
- and other less competitive heavy industries that remain dependent
on the Russian domestic market. This reliance on commodity exports
makes Russia vulnerable to boom and bust cycles that follow the
highly volatile swings in global commodity prices. The government
since 2007 has embarked on an ambitious program to reduce this
dependency and build up the country's high technology sectors, but
with few results so far. The economy had averaged 7% growth since
the 1998 Russian financial crisis, resulting in a doubling of real
disposable incomes and the emergence of a middle class. The Russian
economy, however, was one of the hardest hit by the 2008-09 global
economic crisis as oil prices plummeted and the foreign credits that
Russian banks and firms relied on dried up. The Central Bank of
Russia spent one-third of its $600 billion international reserves,
the world's third largest, in late 2008 to slow the devaluation of
the ruble. The government also devoted $200 billion in a rescue plan
to increase liquidity in the banking sector and aid Russian firms
unable to roll over large foreign debts coming due. The economic
decline bottomed out in mid-2009 and the economy began to grow in
the first quarter of 2010. However, a severe drought and fires in
central Russia reduced agricultural output, prompting a ban on grain
exports for part of the year, and slowed growth in other sectors
such as manufacturing and retail trade. Russia's long-term
challenges include a shrinking workforce, a high level of
corruption, difficulty in accessing capital for smaller, non-energy
companies, and poor infrastructure in need of large investments.
Rwanda
Rwanda is a poor rural country with about 90% of the
population engaged in (mainly subsistence) agriculture and some
mineral and agro-processing. In 2008, minerals overtook coffee and
tea as Rwanda's primary foreign exchange earner. The 1994 genocide
decimated Rwanda's fragile economic base, severely impoverished the
population, particularly women, and temporarily stalled the
country's ability to attract private and external investment.
However, Rwanda has made substantial progress in stabilizing and
rehabilitating its economy to pre-1994 levels. GDP has rebounded and
inflation has been curbed. Nonetheless, a majority still live below
the poverty line of 250 Rwandan francs per day (about US$0.43).
Despite Rwanda's fertile ecosystem, food production often does not
keep pace with demand, requiring food imports. Rwanda continues to
receive substantial aid money and obtained IMF-World Bank Heavily
Indebted Poor Country (HIPC) initiative debt relief in 2005-06.
Rwanda also received a Millennium Challenge Account Compact in 2008.
Africa's most densely populated country is trying to overcome the
limitations of its small, landlocked economy by leveraging regional
trade. Rwanda joined the East African Community and is aligning its
budget, trade, and immigration policies with its regional partners.
The government has embraced an expansionary fiscal policy to reduce
poverty by improving education, infrastructure, and foreign and
domestic investment and pursuing market-oriented reforms, although
energy shortages, instability in neighboring states, and lack of
adequate transportation linkages to other countries continue to
handicap growth. The global downturn hurt export demand and tourism,
but economic growth is recovering, driven in large part by the
services sector, and inflation has been contained. On the back of
this growth, government is gradually ending its fiscal stimulus
policy while protecting aid to the poor.
Saint Barthelemy
The economy of Saint Barthelemy is based upon
high-end tourism and duty-free luxury commerce, serving visitors
primarily from North America. The luxury hotels and villas host
70,000 visitors each year with another 130,000 arriving by boat. The
relative isolation and high cost of living inhibits mass tourism.
The construction and public sectors also enjoy significant
investment in support of tourism. With limited fresh water
resources, all food must be imported, as must all energy resources
and most manufactured goods. Employment is strong and attracts labor
from Brazil and Portugal.
Saint Helena, Ascension, and Tristan da Cunha
The economy depends
largely on financial assistance from the UK, which amounted to about
$27 million in FY06/07 or more than twice the level of annual
budgetary revenues. The local population earns income from fishing,
raising livestock, and sales of handicrafts. Because there are few
jobs, 25% of the work force has left to seek employment on Ascension
Island, on the Falklands, and in the UK.
Saint Kitts and Nevis
The economy of Saint Kitts and Nevis is
heavily dependent upon tourism revenues, which has replaced sugar,
the traditional mainstay of the economy until the 1970s. Following
the 2005 harvest, the government closed the sugar industry after
decades of losses of 3-4% of GDP annually. To compensate for
employment losses, the government has embarked on a program to
diversify the agricultural sector and to stimulate other sectors of
the economy, such as tourism, export-oriented manufacturing, and
offshore banking. More than 200,000 tourists visited the islands in
2009. Like other tourist destinations in the Caribbean, St. Kitts
and Nevis is vulnerable to damage from natural disasters and shifts
in tourism demand. The current government is constrained by one of
the world's highest public debt burdens equivalent to roughly 185%
of GDP, largely attributable to public enterprise losses.
Saint Lucia
The island nation has been able to attract foreign
business and investment, especially in its offshore banking and
tourism industries, with a surge in foreign direct investment in
2006, attributed to the construction of several tourism projects.
Although crops such as bananas, mangos, and avocados continue to be
grown for export, tourism provides Saint Lucia's main source of
income and the industry is the island's biggest employer. Tourism is
the main source of foreign exchange, although tourism sector
revenues declined with the global economic downturn as US and
European travel dropped in 2009. The manufacturing sector is the
most diverse in the Eastern Caribbean area, and the government is
trying to revitalize the banana industry, although recent hurricanes
have caused exports to contract. Saint Lucia is vulnerable to a
variety of external shocks including volatile tourism receipts,
natural disasters, and dependence on foreign oil. The public
debt-to-GDP ratio is about 77% and high debt servicing obligations
constrain the KING administration's ability to respond to adverse
external shocks. Economic fundamentals remain solid, even though
unemployment needs to be reduced.
Saint Martin
The economy of Saint Martin centers around tourism with
85% of the labor force engaged in this sector. Over one million
visitors come to the island each year with most arriving through the
Princess Juliana International Airport in Sint Maarten. No
significant agriculture and limited local fishing means that almost
all food must be imported. Energy resources and manufactured goods
are also imported, primarily from Mexico and the United States.
Saint Martin is reported to have the highest per capita income in
the Caribbean.