Overview:
 The
Gambian economy is a highly open type as measured by export and
import ratios to GDP, however, as much as 70 percent of exports
consist of re-exports. The main domestically-originating exports
are groundnuts and tourism.
The country's economy is mainly reliant mainly agricultural
exports as a foreign currency earner.
Entrepot
(re-export) trade from Banjul Ports
makes up a significant portion of economic activity though the
devaluation of the CFA Franc in 1994 reduced it somewhat.
Tourism, which mostly takes
the form of sun seekers, birdwatchers and African-Americans, makes
up about about 18% of the Gambia's GDP.
Economic
development is very reliant on continued multilateral and
bilateral aid and on prudent economic management by the government
as espoused by the International Monetary Fund's
fiscal help and advice.
The Gambia is among the poorest countries of the world, ranking
155th out of 177 countries in the 2007/2008 UNDP Human Development
Index rankings (HDI). According to the UNDP's
Human Poverty Index (HPI-1) of 2004 poverty is was at 40.9
percent, with rural poverty slightly exceeding urban poverty rates,
except in Banjul where the rate
is much lower. The Gambia’s per capita GDP measured at PPP is
higher than Benin, Senegal or Togo, but literacy is low by regional
standards.
Services account for over 50 percent of GDP, reflecting the importance
of re-export trade and tourism. Agriculture
accounts for about a third of GDP but more than 70 percent of
employment. The manufacturing
sector is undeveloped even by West African standards, providing
only 5 percent of GDP and displaying little dynamism.
Macroeconomic performance deteriorated in 2002–03, reflecting
the impact of loose fiscal policy, accommodating monetary policy
and a drought.
Inflation rose from an average of less than 5 percent in 2001
to 17 percent in 2003, the highest level in nearly two decades.
The dalasi depreciated by 55 percent in nominal effective terms
between end-2001 and end-2003. The seeds for the poor performance
were sown in 2001 when a combination of significant unbudgeted
expenditures and a fall in tax revenues led to a large increase
in government borrowing from the Central
Bank of The Gambia (CBG) and a sharp rise in domestic debt.
Real GDP declined by 3 percent in 2002 because of a drought, but
recovered in 2003.
The 2002 IMF Poverty Reduction
and Growth Facility (PRGF) loan was cut off in 2002 following
spending overruns and irregularities at the CBG. The Gambian government
has sought to re-establish a program with the Fund through a Staff-Monitored
Program (SMP) as an interim step towards re-establishing a PRGF.
The IMF notes that fiscal and monetary policies have been tightened
lately, contributing the sharp decline in inflation, from double
digits in 2003-2004 to 4.5 percent in 2005. Nevertheless, the
IMF expresses continued concerns about slippages in fiscal discipline,
extra-budgetary expenditures, and inadequate auditing of both
fiscal and monetary accounts. The Gambia’s fiscal policy is also
constrained by a large domestic debt and high real interest rates,
such that a substantial primary surplus is required to cover interest
payments.
As at 2008 The Gambia currently had a Staff Monitored Programme
with the IMF, as part of a Medium Term
Economic Framework Plan. The agency has reported some modest
progress on fiscal balance and some improvements in financial
management.
A tightening of fiscal and monetary policies from late-2003 restored
macroeconomic stability and contributed to sustained growth. The
basic primary fiscal balance moved from a deficit of over 1 percent
of GDP in 2001 to an average surplus of nearly 9 percent of GDP
during 2004–07. Yields on treasury bills rose from 15 percent
at end-2001 to 31 percent at end-2003 before declining to 10–15
percent from mid-2005. Inflation fell to less than 1 percent at
end-2006 before a spike in the prices of some imported food items
pushed it to around 6 percent during most of 2007. Real GDP expanded
at a robust average annual rate of 6.5 percent, led by the tourism,
telecommunication, and construction sectors. Tourism infrastructure
has been a major beneficiary of foreign direct investment (FDI).
Gambia’s longer term policy objectives are sketched in the ambitious
Vision 2020 document which aims to turn Gambia into a diversified
middle income economy with the private sector as "a serious
partner in national development and the very engine of growth."
Selected Indicators:
Agriculture:
Products: groundnuts (140,000 tonnes
- 2005), rice, millet, sorghum, corn,
sesame, cassava, palm kernels; livestock:
cattle, sheep, goats
Budget:
revenues: $181.1 million
expenditures: $163.4 million (2007 est.)
Current Account Balance:
-$70 million (2007 est.)
Export
Commodities:
Groundnut products, fish,
raw cotton, palm kernels, hides & entrepot trade
Export Partners (Principle):
India 37.7%, China 17.5%, UK 8.7%, France 5.1%, Belgium 4.2% (2007)
Exports:
$111 million f.o.b. (2008 est.)
External
Debt:
$628.8 million (2003 est.)
Foreign
Exchange Reserves:
$142.8 million (31 December 2007 est.)
Gross
Domestic Product (Estimates - 2008):
GDP (Official Exchange Rate)
$653 million
GDP (PPP)
$2.044 billion
GDP Real Growth Rate
4.5%
GDP Per Capita (PPP)
Purchasing Power Parity
$1,200
GDP Composition by Sector
agriculture: 33%
industry: 8.7%
services: 58.3%
Industries:
Processing peanuts, fish, and hides; tourism; beverages; agricultural
machinery assembly, woodworking, metalworking & clothing
Imports:
Commodities: foodstuffs incl. rice, flour, sugar, manufactured
goods, petroleum, heavy fuel oil, cement bulk & bags, auto
vehicles, machinery equipment .
Import
Partners:
China 23.7%, Senegal 11.5%, Cote d'Ivoire 8.3%, Brazil 8%, Netherlands
5.2% (2007)
Imports:
$301 million f.o.b. (2008 est.)
Inflation - Annual:
Average inflation in Gambia is 5.6 percent - 12-month moving
average (31 December 2014)
Labour
Force:
400,000
Labour Force by Occupation:
agriculture 75%, industry, commerce, and services 19%, government
6%
Unemployment Rate:
The Gambia's unemployment rate is very high though no exact figures
are available.
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Agriculture
Business Guide
Country Facts
