Economic Performance
Djibouti has experienced stable economic growth in recent years as a result of achievements in macroeconomic adjustment efforts. Fiscal adjustment measures included downsizing the civil service, implementing a pension reform that placed the system on a much stronger financial footing, and strengthening public expenditure institutions. From 2003 to 2005, annual real GDP growth averaged 3.1 percent driven by good performance in the services sector and strong consumption. Inflation has been kept low (only 1 percent in 2004, compared with 2.2 percent in 2003), due to the fixed peg of the Djibouti franc to the US dollar. However, as mentioned above, unemployment has remained high at over 40 percent in recent years.
The government fiscal balance is in deficit because the government has not been able to raise sufficient tax revenues to cover expenses. In 2004, a substantial increase in expenditure resulted in a deterioration of the fiscal position. As a result, the government deficit increased to US$17 million in 2004 from US$7 million in 2003. But improvement in expenditure management brought down the fiscal deficit to US$11 million in 2005.
Read more about this topic: Economy Of Djibouti
Famous quotes containing the words economic and/or performance:
“A society which is clamoring for choice, which is filled with many articulate groups, each urging its own brand of salvation, its own variety of economic philosophy, will give each new generation no peace until all have chosen or gone under, unable to bear the conditions of choice. The stress is in our civilization.”
—Margaret Mead (1901–1978)
“The honor my country shall never be stained by an apology from me for the statement of truth and the performance of duty; nor can I give any explanation of my official acts except such as is due to integrity and justice and consistent with the principles on which our institutions have been framed.”
—Andrew Jackson (1767–1845)