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Eritrea Economy 2010
http://www.workmall.com/wfb2010/eritrea/eritrea_economy.html
SOURCE: 2010 CIA WORLD FACTBOOK AND OTHER SOURCES

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Page last updated on January 15, 2010

Economy - overview:
Since independence from Ethiopia in 1993, Eritrea has faced the economic problems of a small, desperately poor country, accentuated by the recent implementation of restrictive economic policies. Eritrea has a command economy under the control of the sole political party, the People's Front for Democracy and Justice (PFDJ). Like the economies of many African nations, the economy is largely based on subsistence agriculture, with 80% of the population involved in farming and herding. The Ethiopian-Eritrea war in 1998-2000 severely hurt Eritrea's economy. GDP growth fell to zero in 1999 and to -12.1% in 2000. The May 2000 Ethiopian offensive into northern Eritrea caused some $600 million in property damage and loss, including losses of $225 million in livestock and 55,000 homes. The attack prevented planting of crops in Eritrea's most productive region, causing food production to drop by 62%. Despite the fighting, Eritrea developed its transportation infrastructure, asphalting new roads, improving its ports, and repairing war-damaged roads and bridges. Since the war's conclusion, the government has maintained a firm grip on the economy, expanding the use of the military and party-owned businesses to complete Eritrea's development agenda. The government strictly controls the use of foreign currency by limiting access and availability. Few private enterprises remain in Eritrea. Eritrea's economy depends heavily on taxes paid by members of the diaspora. Erratic rainfall and the delayed demobilization of agriculturalists from the military continue to interfere with agricultural production, and Eritrea's recent harvests have been unable to meet the food needs of the country. The Government continues to place its hope for additional revenue on the development of several international mining projects. Despite difficulties for international companies in working with the Eritrean Government, a Canadian mining company signed a contract with the Government in 2007 and plans to begin mineral extraction in 2010. Eritrea's economic future depends upon its ability to master social problems such as illiteracy, unemployment, and low skills, and more importantly, on the government's willingness to support a true market economy.

GDP (purchasing power parity):
$4.101 billion (2009 est.)

$4.001 billion (2008 est.)
$3.923 billion (2007 est.)
note: data are in 2009 US dollars

GDP (official exchange rate):
$1.694 billion (2009 est.)

GDP - real growth rate:
2.5% (2009 est.)

2% (2008 est.)
1% (2007 est.)

GDP - per capita (PPP):
$700 (2009 est.)

$700 (2008 est.)
$700 (2007 est.)
note: data are in 2009 US dollars

GDP - composition by sector:
agriculture: 17.3%
industry: 23.2%
services: 59.5% (2009 est.)

Labor force:
1.935 million NA

Labor force - by occupation:
agriculture: 80%
industry and services: 20% (2004 est.)

Unemployment rate:
NA% est.)

Population below poverty line:
50% (2004 est.)

Household income or consumption by percentage share:
lowest 10%: NA%
highest 10%: NA%

Investment (gross fixed):
18.7% of GDP (2009 est.)

Budget:
revenues: $232.7 million
expenditures: $576.1 million (2009 est.)

Inflation rate (consumer prices):
15.5% (2009 est.)

18% (2008 est.)

Commercial bank prime lending rate:
NA% (31 December 2008)

Stock of money:
$896.2 million (31 December 2008)

$749.1 million (31 December 2007)

Stock of quasi money:
$1.053 billion (31 December 2008)

$932.9 million (31 December 2007)

Stock of domestic credit:
$1.851 billion (31 December 2008)

$1.711 billion (31 December 2007)

Agriculture - products:
sorghum, lentils, vegetables, corn, cotton, tobacco, sisal; livestock, goats; fish

Industries:
food processing, beverages, clothing and textiles, light manufacturing, salt, cement

Industrial production growth rate:
2.5% (2009 est.)

Electricity - production:
271 million kWh (2007 est.)

Electricity - consumption:
228 million kWh (2007 est.)

Electricity - exports:
0 kWh (2008 est.)

Electricity - imports:
0 kWh (2008 est.)

Oil - production:
0 bbl/day (2008 est.)

Oil - consumption:
5,000 bbl/day (2008 est.)

Oil - exports:
0 bbl/day (2007 est.)

Oil - imports:
4,790 bbl/day (2007 est.)

Oil - proved reserves:
0 bbl (1 January 2009 est.)

Natural gas - production:
0 cu m (2008 est.)

Natural gas - consumption:
0 cu m (2008 est.)

Natural gas - exports:
0 cu m (2008 est.)

Natural gas - imports:
0 cu m (2008 est.)

Natural gas - proved reserves:
0 cu m (1 January 2009 est.)

Current account balance:
$-254 million (2009 est.)

$-229 million (2008 est.)

Exports:
$12 million (2009 est.)

$13 million (2008 est.)

Exports - commodities:
livestock, sorghum, textiles, food, small manufactures

Exports - partners:
Italy 25.3%, Sudan 17.2%, China 15.8%, India 8.8%, France 6.7%, Saudi Arabia 6.5%, Russia 4.1% (2008)

Imports:
$590 million (2009 est.)

$601 million (2008 est.)

Imports - commodities:
machinery, petroleum products, food, manufactured goods

Imports - partners:
India 28.5%, Saudi Arabia 17.8%, Italy 10.9%, China 8.5%, US 4.4%, Germany 4% (2008)

Reserves of foreign exchange and gold:
$22 million (31 December 2009 est.)

$24 million (31 December 2008 est.)

Debt - external:
$311 million (2000 est.)

Exchange rates:
nakfa (ERN) per US dollar - 15.5 (2009), 15.38 (2008), 15.5 (2007), 15.4 (2006), 14.5 (2005)
note: the official exchange rate is 15 nakfa to the dollar


NOTE: The information regarding Eritrea on this page is re-published from the 2010 World Fact Book of the United States Central Intelligence Agency. No claims are made regarding the accuracy of Eritrea Economy 2010 information contained here. All suggestions for corrections of any errors about Eritrea Economy 2010 should be addressed to the CIA.



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