Chapter M: Major infectious diseases (126)

Sierra Leone
other: student unions; trade unions

Singapore
none

Slovakia
Association of Towns and Villages or ZMOS; Confederation of
Trade Unions or KOZ; Entrepreneurs Association of Slovakia or ZPS;
Federation of Employers' Associations of the Slovak Republic;
National Union of Employers or RUZ; Slovak Chamber of Commerce and
Industry or SOPK; The Business Alliance of Slovakia or PAS

Slovenia
Democratic Party of Slovenian Pensioners or DeSUS
(protecting the rights of the older generation); Slovenian Roma
Association [Jozek Horvat MUC]
other: Catholic Church

Solomon Islands
Isatabu Freedom Movement (IFM); Malaita Eagle Force
(MEF); note - these rival armed ethnic factions crippled the Solomon
Islands in a wave of violence from 1999 to 2003

Somalia
other: numerous clan and sub-clan factions exist both in
support and in opposition to the transitional government

South Africa
Congress of South African Trade Unions or COSATU
[Zwelinzima VAVI, general secretary]; South African Communist Party
or SACP [Blade NZIMANDE, general secretary]; South African National
Civics Organization or SANCO [Mlungisi HLONGWANE, national president]
note: note - COSATU and SACP are in a formal alliance with the ANC

Spain
Association for Victims of Terrorism or AVT (grassroots
organization devoted primarily to opposing ETA terrorist attacks and
supporting its victims); Basta Ya (Spanish for "Enough is Enough";
grassroots organization devoted primarily to opposing ETA terrorist
attacks and supporting its victims); Nunca Mais (Galician for "Never
Again"; formed in response to the oil Tanker Prestige oil spill);
Socialist General Union of Workers or UGT and the smaller
independent Workers Syndical Union or USO; Trade Union Confederation
of Workers' Commissions or CC.OO.
other: business and landowning interests; Catholic Church; free
labor unions (authorized in April 1977); university students

Sri Lanka
Liberation Tigers of Tamil Eelam or LTTE [Velupillai
PRABHAKARAN](insurgent group fighting for a separate state); Tamil
Makkal Viduthalai Pulikal (TMVP) or Karuna Faction [Vinayagamurthi
MURALITHARAN] (paramilitary breakaway from LTTE and fighting LTTE)
other: Buddhist clergy; labor unions; radical chauvinist Sinhalese
groups such as the National Movement Against Terrorism; Sinhalese
Buddhist lay groups

Sudan
Umma Party [SADIQ Siddiq al-Mahdi]; Popular Congress Party or
PCP [Hassan al-TURABI]; Darfur rebel groups including the Justice
and Equality Movement or JEM [Khalil IBRAHIM] and the Sudan
Liberation Movement or SLM [various factional leaders]

Suriname
Association of Indigenous Village Chiefs [Ricardo PANE];
Association of Saramaccan Authorities or Maroon [Head Captain WASE];
Women's Parliament Forum or PVF [Iris GILLIAD]

Svalbard
NA

Swaziland
Swaziland Federation of Trade Unions; Swaziland and
Solidarity Network or SSN

Sweden
Children's Rights in Society; Swedish Confederation of
Professional Employees or TCO; Swedish Federation of Trade Unions or
LO
other: media

Switzerland
NA

Syria
Damascus Declaration National Council [Riyad SEIF, secretary
general] (a broad alliance of opposition groups and individuals
including: Committee for Revival of Civil Society [Michel KILO,
Riyad SEIF]; Communist Action Party [Fateh JAMOUS]; Kurdish
Democratic Alliance; Kurdish Democratic Front; Liberal Nationalists'
Movement; National Democratic Rally; and Syrian Human Rights Society
or HRAS [Fawed FAWUZ]); National Salvation Front (alliance between
former Vice President Abd al-Halim KHADDAM, the SMB, and other small
opposition groups); Syrian Muslim Brotherhood or SMB [Sadr al-Din
al-BAYANUNI] (operates in exile in London; endorsed the Damascus
Declaration, but is not an official member)

Taiwan
Organization for Taiwan Nation Building; World United
Formosans for Independence
other: environmental groups; independence movement; various business
groups
note: debate on Taiwan independence has become acceptable within the
mainstream of domestic politics on Taiwan; political liberalization
and the increased representation of opposition parties in Taiwan's
legislature have opened public debate on the island's national
identity; a broad public consensus has developed that the government
enjoys popular sovereignty and - whatever the ultimate outcome
regarding unification or independence - that Taiwan's people must
have the deciding voice; public opinion polls consistently show a
substantial majority of Taiwan people supports maintaining Taiwan's
status quo for the foreseeable future; advocates of Taiwan
independence oppose the stand that the island will eventually unify
with mainland China; goals of the Taiwan independence movement
include establishing a sovereign nation on Taiwan and entering the
UN; advocates of eventual unification predicate their goal on the
democratic transformation of the mainland

Tajikistan
splinter parties recognized by the government but not by
the base of the party: Democratic Party or DPT [Masud SOBIROV]
(splintered from ISKANDAROV's DPT); Socialist Party or SPT
[Abduhalim GHAFFOROV] (splintered from NARZIEV's SPT)
unregistered political parties: Agrarian Party [Hikmatullo
NASREDDINOV]; Progressive Party [Sulton QUVVATOV]; Unity Party
[Hikmatullo SAIDOV]

Tanzania
Economic and Social Research Foundation or ESRF; Free
Zanzibar; Tanzania Media Women's Association or TAMWA

Thailand
People's Alliance for Democracy or PAD; United Front for
Democracy Against Dictatorship

Timor-Leste
NA

Togo
NA

Tokelau
none

Tonga
Human Rights and Democracy Movement Tonga or HRDMT [Rev.
Simote VEA, chairman]; Public Servant's Association [Finau TUTONE]

Trinidad and Tobago
Jamaat-al Muslimeen [Yasin BAKR]

Tunisia
18 October Group [collective leadership]; Tunisian League
for Human Rights or LTDH [Mokhtar TRIFI]

Turkey
Confederation of Public Sector Unions or KESK [Sami EVREN];
Confederation of Revolutionary Workers Unions or DISK [Suleyman
CELEBI]; Independent Industrialists' and Businessmen's Association
or MUSIAD [Omer Cihad VARDAN]; Moral Rights Workers Union or Hak-Is
[Salim USLU]; Turkish Confederation of Employers' Unions or TISK
[Tugurl KUDATGOBILIK]; Turkish Confederation of Labor or Turk-Is
[Mustafa KUMLU]; Turkish Confederation of Tradesmen and Craftsmen or
TESK [Dervis GUNDAY]; Turkish Industrialists' and Businessmen's
Association or TUSIAD [Arzuhan Dogan YALCINDAG]; Turkish Union of
Chambers of Commerce and Commodity Exchanges or TOBB [M. Rifat
HISARCIKLIOGLU]

Turkmenistan
NA

Turks and Caicos Islands
NA

Tuvalu
none

Uganda
Lord's Resistance Army or LRA [Joseph KONY]; Young
Parliamentary Association [Henry BANYENZAKI]; Parliamentary Advocacy
Forum or PAFO; National Association of Women Organizations in Uganda
or NAWOU [Florence NEKYON]; The Ugandan Coalition for Political
Accountability to Women or COPAW

Ukraine
Committee of Voters of Ukraine [Ihor POPOV]

United Arab Emirates
NA

United Kingdom
Campaign for Nuclear Disarmament; Confederation of
British Industry; National Farmers' Union; Trades Union Congress

United States
environmentalists; business groups; labor unions;
churches; ethnic groups; political action committees or PAC; health
groups; education groups; civic groups; youth groups; transportation
groups; agricultural groups; veterans groups; women's groups; reform
lobbies

Uruguay
Architect's Society of Uruguay (professional organization);
Chamber of Uruguayan Industries (manufacturer's association);
Chemist and Pharmaceutical Association (professional organization);
PIT/CNT (powerful federation of Uruguayan Unions - umbrella labor
organization); Rural Association of Uruguay (rancher's association);
Uruguayan Construction League; Uruguayan Network of Political Women
other: Catholic Church; students

Uzbekistan
Agrarian and Entrepreneurs' Party [Marat ZAHIDOV]; Birlik
(Unity) Movement [Abdurahim POLAT, chairman]; Committee for the
Protection of Human Rights [Marat ZAHIDOV]; Erk (Freedom) Democratic
Party [Muhammad SOLIH, chairman] (was banned 9 December 1992);
Ezgulik Human Rights Society [Vasila INOYATOVA]; Free Farmers' Party
or Ozod Dehqonlar [Nigora HIDOYATOVA]; Human Rights Society of
Uzbekistan [Talib YAKUBOV, chairman]; Independent Human Rights
Organization of Uzbekistan [Mikhail ARDZINOV, chairman]; Mazlum;
Sunshine Coalition [Sanjar UMAROV, chairman]

Vanuatu
NA

Venezuela
FEDECAMARAS, a conservative business group; VECINOS
groups; Venezuelan Confederation of Workers or CTV (labor
organization dominated by the Democratic Action)

Vietnam
8406 Bloc; Democratic Party of Vietnam or DPV; People's
Democratic Party Vietnam or PDP-VN; Alliance for Democracy
note: these groups advocate democracy but are not recognized by the
government

Virgin Islands
NA

Wallis and Futuna
NA

Western Sahara
none

Yemen
Muslim Brotherhood; Women National Committee
other: conservative tribal groups

Zambia
NA

Zimbabwe
Crisis in Zimbabwe Coalition [Xolani ZITHA]; National
Constitutional Assembly or NCA [Lovemore MADHUKU]; Women of Zimbabwe
Arise or WOZA [Jenny WILLIAMS]; Zimbabwe Congress of Trade Unions or
ZCTU [Wellington CHIBEBE]

======================================================================

@2116

Field Listing :: Economy - overview

This entry briefly describes the type of economy, including the
degree of market orientation, the level of economic development, the
most important natural resources, and the unique areas of
specialization. It also characterizes major economic events and
policy changes in the most recent 12 months and may include a
statement about one or two key future macroeconomic trends.
Country

Economy - overview

Afghanistan
Afghanistan's economy is recovering from decades of
conflict. The economy has improved significantly since the fall of
the Taliban regime in 2001 largely because of the infusion of
international assistance, the recovery of the agricultural sector,
and service sector growth. Real GDP growth fell from the 10% level
in 2006-07 to a little more than 3% in 2008. Despite the progress of
the past few years, Afghanistan is extremely poor, landlocked, and
highly dependent on foreign aid, agriculture, and trade with
neighboring countries. Much of the population continues to suffer
from shortages of housing, clean water, electricity, medical care,
and jobs. Criminality, insecurity, and the Afghan Government's
inability to extend rule of law to all parts of the country pose
challenges to future economic growth. It will probably take the
remainder of the decade and continuing donor aid and attention to
significantly raise Afghanistan's living standards from its current
level, among the lowest in the world. International pledges made by
more than 60 countries and international financial institutions at
the Berlin Donors Conference for Afghan reconstruction in March 2004
reached $8.9 billion for 2004-09. While the international community
remains committed to Afghanistan's development, pledging over $57
billion at three donors' conferences since 2002, Kabul will need to
overcome a number of challenges. Expanding poppy cultivation and a
growing opium trade generate roughly $3 billion in illicit economic
activity and looms as one of Kabul's most serious policy concerns.
Other long-term challenges include: budget sustainability, job
creation, corruption, government capacity, and rebuilding war torn
infrastructure.

Akrotiri
Economic activity is limited to providing services to the
military and their families located in Akrotiri. All food and
manufactured goods must be imported.

Albania
Lagging behind its Balkan neighbors, Albania is making the
difficult transition to a more modern open-market economy.
Macroeconomic growth has averaged around 5% over the last five years
and inflation is low and stable. The government has taken measures
to curb violent crime, and recently adopted a fiscal reform package
aimed at reducing the large gray economy and attracting foreign
investment. The economy is bolstered by annual remittances from
abroad representing about 15% of GDP, mostly from Albanians residing
in Greece and Italy; this helps offset the towering trade deficit.
The agricultural sector, which accounts for over half of employment
but only about one-fifth of GDP, is limited primarily to small
family operations and subsistence farming because of lack of modern
equipment, unclear property rights, and the prevalence of small,
inefficient plots of land. Energy shortages because of a reliance on
hydropower, and antiquated and inadequate infrastructure contribute
to Albania's poor business environment and lack of success in
attracting new foreign investment. The completion of a new thermal
power plant near Vlore has helped diversify generation capacity, and
plans to upgrade transmission lines between Albania and Montenegro
and Kosovo would help relieve the energy shortages. Also, with help
from EU funds, the government is taking steps to improve the poor
national road and rail network, a long-standing barrier to sustained
economic growth.

Algeria
The hydrocarbons sector is the backbone of the economy,
accounting for roughly 60% of budget revenues, 30% of GDP, and over
95% of export earnings. Algeria has the eighth-largest reserves of
natural gas in the world and is the fourth-largest gas exporter; it
ranks 15th in oil reserves. Sustained high oil prices in recent
years have helped improve Algeria's financial and macroeconomic
indicators. Algeria is running substantial trade surpluses and
building up record foreign exchange reserves. Algeria has decreased
its external debt to less than 5% of GDP after repaying its Paris
Club and London Club debt in 2006. Real GDP has risen due to higher
oil output and increased government spending. The government's
continued efforts to diversify the economy by attracting foreign and
domestic investment outside the energy sector, however, has had
little success in reducing high unemployment and improving living
standards. Structural reform within the economy, such as development
of the banking sector and the construction of infrastructure, moves
ahead slowly hampered by corruption and bureaucratic resistance.

American Samoa
American Samoa has a traditional Polynesian economy
in which more than 90% of the land is communally owned. Economic
activity is strongly linked to the US with which American Samoa
conducts most of its commerce. Tuna fishing and tuna processing
plants are the backbone of the private sector, with canned tuna the
primary export. Transfers from the US Government add substantially
to American Samoa's economic well being. Attempts by the government
to develop a larger and broader economy are restrained by Samoa's
remote location, its limited transportation, and its devastating
hurricanes. Tourism is a promising developing sector.

Andorra
Tourism, the mainstay of Andorra's tiny, well-to-do economy,
accounts for more than 80% of GDP. An estimated 11.6 million
tourists visit annually, attracted by Andorra's duty-free status and
by its summer and winter resorts. Andorra's comparative advantage
has recently eroded as the economies of neighboring France and Spain
have been opened up, providing broader availability of goods and
lower tariffs. The banking sector, with its partial "tax haven"
status, also contributes substantially to the economy. Agricultural
production is limited - only 2% of the land is arable - and most
food has to be imported. The principal livestock activity is sheep
raising. Manufacturing output consists mainly of cigarettes, cigars,
and furniture. Andorra is a member of the EU Customs Union and is
treated as an EU member for trade in manufactured goods (no tariffs)
and as a non-EU member for agricultural products.

Angola
Angola's high growth rate is driven by its oil sector, which
has taken advantage of high international oil prices. Oil production
and its supporting activities contribute about 85% of GDP. Increased
oil production supported growth averaging more than 15% per year
from 2004 to 2007. A postwar reconstruction boom and resettlement of
displaced persons has led to high rates of growth in construction
and agriculture as well. Much of the country's infrastructure is
still damaged or undeveloped from the 27-year-long civil war.
Remnants of the conflict such as widespread land mines still mar the
countryside even though an apparently durable peace was established
after the death of rebel leader Jonas SAVIMBI in February 2002.
Subsistence agriculture provides the main livelihood for most of the
people, but half of the country's food must still be imported. In
2005, the government started using a $2 billion line of credit,
since increased to $7 billion, from China to rebuild Angola's public
infrastructure, and several large-scale projects were completed in
2006. Angola also has large credit lines from Brazil, Portugal,
Germany, Spain, and the EU. The central bank in 2003 implemented an
exchange rate stabilization program using foreign exchange reserves
to buy kwanzas out of circulation. This policy became more
sustainable in 2005 because of strong oil export earnings; it has
significantly reduced inflation. Although consumer inflation
declined from 325% in 2000 to under 13% in 2008, the stabilization
policy has put pressure on international net liquidity. Angola
became a member of OPEC in late 2006 and in late 2007 was assigned a
production quota of 1.9 million barrels a day, somewhat less than
the 2-2.5 million bbl Angola's government had wanted. To fully take
advantage of its rich national resources - gold, diamonds, extensive
forests, Atlantic fisheries, and large oil deposits - Angola will
need to implement government reforms, increase transparency, and
reduce corruption. The government has rejected a formal IMF
monitored program, although it continues Article IV consultations
and ad hoc cooperation. Corruption, especially in the extractive
sectors, and the negative effects of large inflows of foreign
exchange, are major challenges facing Angola.

Anguilla
Anguilla has few natural resources, and the economy depends
heavily on luxury tourism, offshore banking, lobster fishing, and
remittances from emigrants. Increased activity in the tourism
industry has spurred the growth of the construction sector
contributing to economic growth. Anguillan officials have put
substantial effort into developing the offshore financial sector,
which is small but growing. In the medium term, prospects for the
economy will depend largely on the tourism sector and, therefore, on
revived income growth in the industrialized nations as well as on
favorable weather conditions.

Antarctica
Fishing off the coast and tourism, both based abroad,
account for Antarctica's limited economic activity. Antarctic
fisheries in 2006-07 (1 July-30 June) reported landing 126,976
metric tons (estimated fishing from the area covered by the
Convention on the Conservation of Antarctic Marine Living Resources
(CCAMLR), which extends slightly beyond the Antarctic Treaty area).
Unregulated fishing, particularly of Patagonian toothfish
(Dissostichus eleginoides - also known as Chilean sea bass), is a
serious problem. The CCAMLR determines the recommended catch limits
for marine species. A total of 45,652 tourists visited the Antarctic
Treaty area in the 2007-08 Antarctic summer, up from the 36,460
visitors in 2006-2007, and the 30,877 visitors in 2005-2006
(estimates provided to the Antarctic Treaty by the International
Association of Antarctica Tour Operators (IAATO); this does not
include passengers on overflights). Nearly all of them were
passengers on commercial (nongovernmental) ships and several yachts
that make trips during the summer. Most tourist trips last
approximately two weeks.

Antigua and Barbuda
Antigua has a relatively high GDP per capita in
comparison to most other Caribbean nations. The economy experienced
solid growth from 2003 to 2007, reaching over 12% in 2006 driven by
a construction boom in hotels and housing associated with the
Cricket World Cup. Growth dropped off in 2008 with the end of the
boom. Tourism continues to dominate the economy, accounting for
nearly 60% of GDP and 40% of investment. The dual-island nation's
agricultural production is focused on the domestic market and
constrained by a limited water supply and a labor shortage stemming
from the lure of higher wages in tourism and construction.
Manufacturing comprises enclave-type assembly for export with major
products being bedding, handicrafts, and electronic components.
Prospects for economic growth in the medium term will continue to
depend on tourist arrivals from the US, Canada, and Europe and
potential damages from natural disasters. Since taking office in
2004, the SPENCER government has adopted an ambitious fiscal reform
program, and has been successful in reducing its public debt-to-GDP
ratio from 120% to about 90%.

Arctic Ocean
Economic activity is limited to the exploitation of
natural resources, including petroleum, natural gas, fish, and seals.

Argentina
Argentina benefits from rich natural resources, a highly
literate population, an export-oriented agricultural sector, and a
diversified industrial base. Although one of the world's wealthiest
countries 100 years ago, Argentina suffered during most of the 20th
century from recurring economic crises, persistent fiscal and
current account deficits, high inflation, mounting external debt,
and capital flight. A severe depression, growing public and external
indebtedness, and a bank run culminated in 2001 in the most serious
economic, social, and political crisis in the country's turbulent
history. Interim President Adolfo RODRIGUEZ SAA declared a default -
the largest in history - on the government's foreign debt in
December of that year, and abruptly resigned only a few days after
taking office. His successor, Eduardo DUHALDE, announced an end to
the peso's decade-long 1-to-1 peg to the US dollar in early 2002.
The economy bottomed out that year, with real GDP 18% smaller than
in 1998 and almost 60% of Argentines under the poverty line. Real
GDP rebounded to grow by an average 9% annually over the subsequent
five years, taking advantage of previously idled industrial capacity
and labor, an audacious debt restructuring and reduced debt burden,
excellent international financial conditions, and expansionary
monetary and fiscal policies. Inflation also increased, however,
during the administration of President Nestor KIRCHNER, which
responded with price restraints on businesses, as well as export
taxes and restraints, and beginning in early 2007, with understating
inflation data. Cristina FERNANDEZ DE KIRCHNER succeeded her husband
as President in late 2007, but was stymied in her efforts to hike
export taxes still further by protesting farmers. Her government
nationalized private pension funds in late 2008, which bolstered
government coffers, but failed to assuage investors' concerns about
the direction of economic policy.

Armenia
Since the breakup of the Soviet Union in 1991, Armenia has
made progress in implementing many economic reforms including
privatization, price reforms, and prudent fiscal policies. The
conflict with Azerbaijan over the ethnic Armenian-dominated region
of Nagorno-Karabakh contributed to a severe economic decline in the
early 1990s. By 1994, however, the Armenian Government launched an
ambitious IMF-sponsored economic liberalization program that
resulted in positive growth rates. Economic growth has averaged over
10% in recent years. However, with the global economic downturn,
Armenia's growth rate dropped to 6.8% in 2008. Armenia has managed
to reduce poverty, slash inflation, stabilize its currency, and
privatize most small- and medium-sized enterprises. Under the old
Soviet central planning system, Armenia developed a modern
industrial sector, supplying machine tools, textiles, and other
manufactured goods to sister republics, in exchange for raw
materials and energy. Armenia has since switched to small-scale
agriculture and away from the large agroindustrial complexes of the
Soviet era. Nuclear power plants built at Metsamor in the 1970s were
closed following the 1988 Spitak Earthquake, though they sustained
no damage. One of the two reactors was re-opened in 1995, but the
Armenian government is under international pressure to close it due
to concerns that the Soviet era design lacks important safeguards.
Metsamor provides 40 percent of the country's electricity -
hydropower accounts for about one-fourth. Economic ties with Russia
remain close, especially in the energy sector. The electricity
distribution system was privatized in 2002 and bought by Russia's
RAO-UES in 2005. Construction of a pipeline to deliver natural gas
from Iran to Armenia was completed in December 2008 and after
testing is expected to be operational in Spring 2009, though it is
unlikely significant quantities of gas will flow through it until
the Yerevan Thermal Power Plant renovation is completed in 2010.
Armenia has some mineral deposits (copper, gold, bauxite). Pig iron,
unwrought copper, and other nonferrous metals are Armenia's highest
valued exports. Armenia's severe trade imbalance has been offset
somewhat by international aid, remittances from Armenians working
abroad, and foreign direct investment. Armenia joined the WTO in
January 2003. The government made some improvements in tax and
customs administration in recent years, but anti-corruption measures
will be more difficult to implement. Despite strong economic growth,
Armenia's unemployment rate remains high. Armenia will need to
pursue additional economic reforms in order to improve its economic
competitiveness and to build on recent improvements in poverty and
unemployment, especially given its economic isolation from two of
its nearest neighbors, Turkey and Azerbaijan. The disruption of rail
transit into Armenia during the Georgia-Russia conflict in August
2008 highlighted how vulnerable Armenia's supply chains for key
goods - such as gasoline - are to instances of regional instability.

Aruba
Tourism is the mainstay of the small open Aruban economy with
offshore banking and oil refining and storage also important. The
rapid growth of the tourism sector over the last decade has resulted
in a substantial expansion of other activities. Over 1.5 million
tourists per year visit Aruba with 75% of those from the US.
Construction continues to boom with hotel capacity five times the
1985 level. In addition, the country's oil refinery reopened in 1993
providing a major source of employment, foreign exchange earnings,
and growth. Tourist arrivals have rebounded strongly following a dip
after the 11 September 2001 attacks. The island experiences only a
brief low season. Hotel occupancy in 2004 averaged 80% compared to
68% throughout the rest of the Caribbean. The government has made
cutting the budget and trade deficits a high priority.

Ashmore and Cartier Islands
no economic activity

Atlantic Ocean
The Atlantic Ocean provides some of the world's most
heavily trafficked sea routes, between and within the Eastern and
Western Hemispheres. Other economic activity includes the
exploitation of natural resources, e.g., fishing, dredging of
aragonite sands (The Bahamas), and production of crude oil and
natural gas (Caribbean Sea, Gulf of Mexico, and North Sea).

Australia
Australia has an enviable, strong economy with a per
capita GDP on par with the four dominant West European economies.
Emphasis on reforms, low inflation, a housing market boom, and
growing ties with China have been key factors over the course of the
economy's 17 solid years of expansion. Robust business and consumer
confidence and high export prices for raw materials and agricultural
products fueled the economy in recent years, particularly in mining
states. Drought, robust import demand, and a strong currency pushed
the trade deficit up however, while infrastructure bottlenecks and a
tight labor market constrained growth in export volumes and stoked
inflation through mid-2008. The unwinding of the yen-based carry
trade in late 2008 has contributed to a weakening of the Australian
dollar. Tight global liquidity has challenged Australia's banking
sector, which relies heavily on international wholesale markets for
funding. The economy remains relatively healthy despite falling
export commodity prices. The government plans to counter slowing
growth in 2009 with fiscal stimulus efforts.

Austria
Austria, with its well-developed market economy and high
standard of living, is closely tied to other EU economies,
especially Germany's. Its economy features a large service sector, a
sound industrial sector, and a small, but highly developed
agricultural sector. Following several years of solid foreign demand
for Austrian exports and record employment growth, the global
economic downturn in 2008 led to a recession that is likely to
persist through 2009. The government's stabilization measures could
increase the budget deficit to about 2.8% of GDP in 2009 and above
3% in 2010, from about 0.6% in 2008. The Austrian economy has
benefited greatly in the past from strong commercial relations,
especially in the banking and insurance sectors, with central,
eastern, and southeastern Europe, but these sectors have been
vulnerable to recent international financial instabilities, and some
of Austria's largest banks have required government support. Even
after the global economic outlook improves, Austria will need to
continue restructuring, emphasizing knowledge-based sectors of the
economy, and encouraging greater labor flexibility and greater labor
participation to offset its aging population and exceedingly low
fertility rate.

Azerbaijan
Azerbaijan's high economic growth during 2006-08 is
attributable to large and growing oil exports, but the non-energy
sector also featured double-digit growth in 2008, spurred by growth
in the construction, banking, and real estate sectors. However, the
current global economic slowdown presents some challenges for the
Azerbaijani economy as oil prices have plummeted since mid-2008 and
local banks face a more uncertain international financial
environment. Azerbaijan's oil production declined through 1997, but
has registered an increase every year since. Negotiation of
production-sharing arrangements (PSAs) with foreign firms, which
have committed $60 billion to long-term oilfield development, should
generate the funds needed to spur future industrial development. Oil
production under the first of these PSAs, with the Azerbaijan
International Operating Company, began in November 1997. A
consortium of Western oil companies built a $4 billion pipeline from
Baku to Turkey's Mediterranean port of Ceyhan which will pump 1.2
million barrels a day from a large offshore field when at full
capacity. Azerbaijan shares all the formidable problems of the
former Soviet republics in making the transition from a command to a
market economy, but its considerable energy resources brighten its
medium-term prospects. Baku has only recently begun making progress
on economic reform, and old economic ties and structures are slowly
being replaced. Several other obstacles impede Azerbaijan's economic
progress: the need for stepped up foreign investment in the
non-energy sector, the continuing conflict with Armenia over the
Nagorno-Karabakh region, pervasive corruption, and potential for a
sharp downturn in the construction and real estate sectors. Trade
with Russia and the other former Soviet republics is declining in
importance, while trade is building with Turkey and the nations of
Europe. Long-term prospects will depend on world oil prices, the
location of new oil and gas pipelines in the region, and
Azerbaijan's ability to manage its energy wealth to promote
sustainable growth in non-energy sectors of the economy and spur
employment.

Bahamas, The
The Bahamas is one of the wealthiest Caribbean
countries with an economy heavily dependent on tourism and offshore
banking. Tourism together with tourism-driven construction and
manufacturing accounts for approximately 60% of GDP and directly or
indirectly employs half of the archipelago's labor force. Steady
growth in tourism receipts and a boom in construction of new hotels,
resorts, and residences had led to solid GDP growth in recent years,
but tourist arrivals have been on the decline since 2006 and will
likely drop even further in 2009. Tourism, in turn, depends on
growth in the US, the source of more than 80% of the visitors. To
help offset the effect of the global economic downturn, particularly
on employment, the INGRAHAM administration plans to engage in
infrastructure projects. Financial services constitute the
second-most important sector of the Bahamian economy and, when
combined with business services, account for about 36% of GDP.
However, since December 2000, when the government enacted new
regulations on the financial sector, many international businesses
have left The Bahamas. Manufacturing and agriculture combined
contribute approximately a tenth of GDP and show little growth,
despite government incentives aimed at those sectors. Overall growth
prospects in the short run rest heavily on the fortunes of the
tourism sector.

Bahrain
With its highly developed communication and transport
facilities, Bahrain is home to numerous multinational firms with
business in the Gulf. Petroleum production and refining account for
over 60% of Bahrain's export receipts, over 70% of government
revenues, and 11% of GDP (exclusive of allied industries),
underpinning Bahrain's strong economic growth in recent years.
Aluminum is Bahrain's second major export after oil. Other major
segments of Bahrain's economy are the financial and construction
sectors. Bahrain is focused on Islamic banking and is competing on
an international scale with Malaysia as a worldwide banking center.
Bahrain is actively pursuing the diversification and privatization
of its economy to reduce the country's dependence on oil. As part of
this effort, in August 2006 Bahrain and the US implemented a Free
Trade Agreement (FTA), the first FTA between the US and a Gulf
state. Continued strong growth hinges on Bahrain's ability to
acquire new natural gas supplies as feedstock to support its
expanding petrochemical and aluminum industries. Unemployment,
especially among the young, and the depletion of oil and underground
water resources are long-term economic problems. The global
financial crisis is likely to result in slower economic growth for
Bahrain during 2009 as tight international credit and a slowing
global economy cause funding for many non-oil projects to dry up.
Lower oil prices may also cause Bahrain's budget to slip back into
deficit.

Bangladesh
The economy has grown 5-6% per year since 1996 despite
inefficient state-owned enterprises, delays in exploiting natural
gas resources, insufficient power supplies, and slow implementation
of economic reforms. Bangladesh remains a poor, overpopulated, and
inefficiently-governed nation. Although more than half of GDP is
generated through the service sector, nearly two-thirds of
Bangladeshis are employed in the agriculture sector, with rice as
the single-most-important product. Garment exports and remittances
from Bangladeshis working overseas, mainly in the Middle East and
East Asia, fuel economic growth. In 2008 Bangladesh pursued a
monetary policy aimed at maintaining high employment, but created
higher inflation in the process.

Barbados
Historically, the Barbadian economy was dependent on
sugarcane cultivation and related activities. However, in recent
years the economy has diversified into light industry and tourism
with about three-quarters of GDP and 80% of exports being attributed
to services. Growth has rebounded since 2003, bolstered by increases
in construction projects and tourism revenues, reflecting its
success in the higher-end segment, but the sector will likely face
declining revenues with the global economic downturn. The country
enjoys one of the highest per capita incomes in the region. Offshore
finance and information services are important foreign exchange
earners and thrive from having the same time zone as eastern US
financial centers and a relatively highly educated workforce. The
government continues its efforts to reduce unemployment, to
encourage direct foreign investment, and to privatize remaining
state-owned enterprises. The public debt-to-GDP ratio of about 80%
will likely widen as the THOMPSON administration engages in a more
expansionary fiscal policy.

Belarus
Belarus has seen little structural reform since 1995, when
President LUKASHENKO launched the country on the path of "market
socialism." In keeping with this policy, LUKASHENKO reimposed
administrative controls over prices and currency exchange rates and
expanded the state's right to intervene in the management of private
enterprises. Since 2005, the government has re-nationalized a number
of private companies. In addition, businesses have been subject to
pressure by central and local governments, e.g., arbitrary changes
in regulations, numerous rigorous inspections, retroactive
application of new business regulations, and arrests of "disruptive"
businessmen and factory owners. A wide range of redistributive
policies has helped those at the bottom of the ladder; the Gini
coefficient is among the lowest in the world. Because of these
restrictive economic policies, Belarus has had trouble attracting
foreign investment. Nevertheless, government statistics indicate GDP
growth has been strong in recent years, reaching 10% in 2008,
despite the roadblocks of a tough, centrally directed economy with a
high rate of inflation. Belarus receives discounted oil and natural
gas from Russia and much of Belarus' growth can be attributed to the
re-export of Russian oil at market prices. Trade with Russia - by
far its largest single trade partner - decreased in 2007-08, largely
as a result of a change in the way the Value Added Tax (VAT) on
trade was collected. Russia has introduced an export duty on oil
shipped to Belarus, which will increase gradually through 2009, and
a requirement that Belarusian duties on re-exported Russian oil be
shared with Russia - 80% was slated to go to Russia in 2008, and 85%
in 2009. Russia also increased Belarusian natural gas prices from
$47 per thousand cubic meters (tcm)in 2006 to $100 per tcm in 2007,
and to $128 per tcm in 2008, and plans to increase prices gradually
to world levels by 2011. Russia's recent policy of bringing energy
prices for Belarus to world market levels may result in a slowdown
in economic growth in Belarus over the next few years. Some policy
measures, including improving energy efficiency and diversifying
exports, have been introduced, but external borrowing has been the
main mechanism used to manage the growing pressures on the economy.
Belarus felt the effects of the global financial crisis in late 2008
and reached agreement with Russia in November for a $2 billion
stabilization loan and with the IMF for a $2.5 billion stand-by
agreement in January 2009. In line with IMF conditionality, Belarus
devalued the ruble approximately 20% in January 2009 and has
tightened some fiscal and monetary policies. Belarus's economic
growth is likely to slow in 2009 as it faces decreasing demand for
its exports, and will find it difficult to increase external
borrowing if the credit markets continue to tighten.

Belgium
This modern, private-enterprise economy has capitalized on
its central geographic location, highly developed transport network,
and diversified industrial and commercial base. Industry is
concentrated mainly in the populous Flemish area in the north. With
few natural resources, Belgium must import substantial quantities of
raw materials and export a large volume of manufactures, making its
economy unusually dependent on the state of world markets. Roughly
three-quarters of its trade is with other EU countries. Public debt
is more than 80% of GDP. On the positive side, the government
succeeded in balancing its budget during the 2000-2008 period, and
income distribution is relatively equal. Belgium began circulating
the euro currency in January 2002. Economic growth and foreign
direct investment dropped in 2008. In 2009 Belgium is likely to have
negative growth, growing unemployment, and a 3% budget deficit,
stemming from the worldwide banking crisis.

Belize
In this small, essentially private-enterprise economy,
tourism is the number one foreign exchange earner followed by
exports of marine products, citrus, cane sugar, bananas, and
garments. The government's expansionary monetary and fiscal
policies, initiated in September 1998, led to sturdy GDP growth
averaging nearly 4% in 1999-2007, though growth slipped to 3.8% in
2008 as a result of the global slowdown, natural disasters, and the
drop in the price of oil. Oil discoveries in 2006 bolstered the
economic growth. Exploration efforts continue and a small increase
in production is expected in 2009. Major concerns continue to be the
sizable trade deficit and unsustainable foreign debt equivalent to
nearly 70% of GDP. In February 2007, the government restructured
nearly all of its public external commercial debt, which helped
reduce interest payments and relieve some of the country's liquidity
concerns. A key short-term objective remains the reduction of
poverty with the help of international donors.

Benin
The economy of Benin remains underdeveloped and dependent on
subsistence agriculture, cotton production, and regional trade.
Growth in real output has averaged around 5% in the past seven
years, but rapid population growth has offset much of this increase.
Inflation has subsided over the past several years. In order to
raise growth still further, Benin plans to attract more foreign
investment, place more emphasis on tourism, facilitate the
development of new food processing systems and agricultural
products, and encourage new information and communication
technology. Specific projects to improve the business climate by
reforms to the land tenure system, the commercial justice system,
and the financial sector were included in Benin's $307 million
Millennium Challenge Account grant signed in February 2006. The 2001
privatization policy continues in telecommunications, water,
electricity, and agriculture though the government annulled the
privatization of Benin's state cotton company in November 2007 after
the discovery of irregularities in the bidding process. The Paris
Club and bilateral creditors have eased the external debt situation,
with Benin benefiting from a G8 debt reduction announced in July
2005, while pressing for more rapid structural reforms. An
insufficient electrical supply continues to adversely affect Benin's
economic growth though the government recently has taken steps to
increase domestic power production.

Bermuda
Bermuda enjoys the third highest per capita income in the
world more than 50% higher than that of the US. Its economy is
primarily based on providing financial services for international
business and luxury facilities for tourists. A number of reinsurance
companies relocated to the island following the 11 September 2001
attacks and again after Hurricane Katrina in August 2005
contributing to the expansion of an already robust international
business sector. Bermuda's tourism industry - which derives over 80%
of its visitors from the US - continues to struggle but remains the
island's number two industry. Most capital equipment and food must
be imported. Bermuda's industrial sector is small, although
construction continues to be important; the average cost of a house
in June 2003 had risen to $976,000. Agriculture is limited with only
20% of the land being arable.

Bhutan
The economy, one of the world's smallest and least developed,
is based on agriculture and forestry, which provide the main
livelihood for more than 60% of the population. Agriculture consists
largely of subsistence farming and animal husbandry. Rugged
mountains dominate the terrain and make the building of roads and
other infrastructure difficult and expensive. The economy is closely
aligned with India's through strong trade and monetary links and
dependence on India's financial assistance. The industrial sector is
technologically backward, with most production of the cottage
industry type. Most development projects, such as road construction,
rely on Indian migrant labor. Model education, social, and
environment programs are underway with support from multilateral
development organizations. Each economic program takes into account
the government's desire to protect the country's environment and
cultural traditions. For example, the government, in its cautious
expansion of the tourist sector, encourages visits by upscale,
environmentally conscientious tourists. Detailed controls and
uncertain policies in areas such as industrial licensing, trade,
labor, and finance continue to hamper foreign investment. Hydropower
exports to India have boosted Bhutan's overall growth, even though
GDP fell in 2008 as a result of a slowdown in India, its predominant
export market. New hydropower projects will be the driving force
behind Bhutan's ability to create employment and sustain growth in
the coming years.

Bolivia
Bolivia is one of the poorest and least developed countries
in Latin America. Following a disastrous economic crisis during the
early 1980s, reforms spurred private investment, stimulated economic
growth, and cut poverty rates in the 1990s. The period 2003-05 was
characterized by political instability, racial tensions, and violent
protests against plans - subsequently abandoned - to export
Bolivia's newly discovered natural gas reserves to large northern
hemisphere markets. In 2005, the government passed a controversial
hydrocarbons law that imposed significantly higher royalties and
required foreign firms then operating under risk-sharing contracts
to surrender all production to the state energy company. In early
2008, higher earnings for mining and hydrocarbons exports pushed the
current account surplus to 9.4% of GDP and the government's higher
tax take produced a fiscal surplus after years of large deficits.
Private investment as a share of GDP, however, remains among the
lowest in Latin America, and inflation remained at double-digit
levels in 2008. The decline in commodity prices in late 2008, the
lack of foreign investment in the mining and hydrocarbon sectors,
and the suspension of trade benefits with the United States will
pose challenges for the Bolivian economy in 2009.

Bosnia and Herzegovina
The interethnic warfare in Bosnia and
Herzegovina caused production to plummet by 80% from 1992 to 1995
and unemployment to soar. With an uneasy peace in place, output
recovered in 1996-99 at high percentage rates from a low base; but
output growth slowed in 2000-02. Part of the lag in output was made
up in 2003-08 when GDP growth exceeded 5% per year. Banking reform
accelerated in 2001 as all the Communist-era payments bureaus were
shut down; foreign banks, primarily from Western Europe, now control
most of the banking sector. The konvertibilna marka (convertible
mark or BAM)- the national currency introduced in 1998 - is pegged
to the euro, and confidence in the currency and the banking sector
has increased. Bosnia's private sector is growing and foreign
investment is slowly increasing, but government spending, at nearly
40% of adjusted GDP, remains high because of redundant government
offices at the state, entity and municipal level. Implementing
privatization, however, has been slow, particularly in the
Federation where political division between ethnically-based
political parties makes agreement on economic policy more difficult.
A sizeable current account deficit and high unemployment rate remain
the two most serious macroeconomic problems. Successful
implementation of a value-added tax in 2006 provided a predictable
source of revenue for the government and helped rein in gray market
activity. National-level statistics have also improved over time but
a large share of economic activity remains unofficial and
unrecorded. Bosnia and Herzegovina became a full member of the
Central European Free Trade Agreement in September 2007. Bosnia's
economy has been largely sheltered from the global financial
downtown although key economic indicators have worsened. Key
exporters in the metal, automobile and wood processing industries
have reported a worsening performance and have announced layoffs and
output reductions.

Botswana
Botswana has maintained one of the world's highest economic
growth rates since independence in 1966, though growth fell below 5%
in 2007-08. Through fiscal discipline and sound management, Botswana
has transformed itself from one of the poorest countries in the
world to a middle-income country with a per capita GDP of $13,300 in
2008. Two major investment services rank Botswana as the best credit
risk in Africa. Diamond mining has fueled much of the expansion and
currently accounts for more than one-third of GDP and for 70-80% of
export earnings. Tourism, financial services, subsistence farming,
and cattle raising are other key sectors. On the downside, the
government must deal with high rates of unemployment and poverty.
Unemployment officially was 23.8% in 2004, but unofficial estimates
place it closer to 40%. HIV/AIDS infection rates are the second
highest in the world and threaten Botswana's impressive economic
gains. An expected leveling off in diamond mining production
overshadows long-term prospects.

Bouvet Island
no economic activity; declared a nature reserve

Brazil
Characterized by large and well-developed agricultural,
mining, manufacturing, and service sectors, Brazil's economy
outweighs that of all other South American countries and Brazil is
expanding its presence in world markets. From 2003 to 2007, Brazil
ran record trade surpluses and recorded its first current account
surpluses since 1992. Productivity gains coupled with high commodity
prices contributed to the surge in exports. Brazil improved its debt
profile in 2006 by shifting its debt burden toward real denominated
and domestically held instruments. LULA da Silva restated his
commitment to fiscal responsibility by maintaining the country's
primary surplus during the 2006 election. Following his second
inauguration in October of that year, LULA da Silva announced a
package of further economic reforms to reduce taxes and increase
investment in infrastructure. Brazil's debt achieved investment
grade status early in 2008, but the government's attempt to achieve
strong growth while reducing the debt burden created inflationary
pressures. For most of 2008, the Central Bank embarked on a
restrictive monetary policy to stem these pressures. Since the onset
of the global financial crisis in September, Brazil's currency and
its stock market - Bovespa - have significantly lost value, -41% for
Bovespa for the year ending 30 December 2008. Brazil incurred
another current account deficit in 2008, as world demand and prices
for commodities dropped in the second-half of the year.

British Indian Ocean Territory
All economic activity is concentrated
on the largest island of Diego Garcia, where a joint UK-US military
facility is located. Construction projects and various services
needed to support the military installation are performed by
military and contract employees from the UK, Mauritius, the
Philippines, and the US. There are no industrial or agricultural
activities on the islands. The territory earns foreign exchange by
selling fishing licenses and postage stamps.

British Virgin Islands
The economy, one of the most stable and
prosperous in the Caribbean, is highly dependent on tourism
generating an estimated 45% of the national income. An estimated
820,000 tourists, mainly from the US, visited the islands in 2005.
In the mid-1980s, the government began offering offshore
registration to companies wishing to incorporate in the islands, and
incorporation fees now generate substantial revenues. Roughly
400,000 companies were on the offshore registry by yearend 2000. The
adoption of a comprehensive insurance law in late 1994, which
provides a blanket of confidentiality with regulated statutory
gateways for investigation of criminal offenses, made the British
Virgin Islands even more attractive to international business.
Livestock raising is the most important agricultural activity; poor
soils limit the islands' ability to meet domestic food requirements.
Because of traditionally close links with the US Virgin Islands, the
British Virgin Islands has used the US dollar as its currency since
1959.

Brunei
Brunei has a small well-to-do economy that encompasses a
mixture of foreign and domestic entrepreneurship, government
regulation, welfare measures, and village tradition. Crude oil and
natural gas production account for just over half of GDP and more
than 90% of exports. Per capita GDP is among the highest in Asia,
and substantial income from overseas investment supplements income
from domestic production. The government provides for all medical
services and free education through the university level and
subsidizes rice and housing. Brunei's leaders are concerned that
steadily increased integration into the world economy will undermine
internal social cohesion. Plans for the future include upgrading the
labor force, reducing unemployment, strengthening the banking and
tourist sectors, increasing agricultural production, and, in
general, further widening the economic base beyond oil and gas.

Bulgaria
Bulgaria, a former Communist country that entered the EU on
1 January 2007, has experienced strong growth since a major economic
downturn in 1996. Successive governments have demonstrated a
commitment to economic reforms and responsible fiscal planning, but
have failed so far to rein in rising inflation and large current
account deficits. Bulgaria has averaged more than 6% growth since
2004, attracting significant amounts of foreign direct investment,
but corruption in the public administration, a weak judiciary, and
the presence of organized crime remain significant challenges.

Burkina Faso
One of the poorest countries in the world, landlocked
Burkina Faso has few natural resources and a weak industrial base.
About 90% of the population is engaged in subsistence agriculture,
which is vulnerable to periodic drought. Cotton is the main cash
crop and the government has joined with three other cotton producing
countries in the region - Mali, Niger, and Chad - to lobby in the
World Trade Organization for fewer subsidies to producers in other
competing countries. Since 1998, Burkina Faso has embarked upon a
gradual but successful privatization of state-owned enterprises.
Having revised its investment code in 2004, Burkina Faso hopes to
attract foreign investors. Thanks to this new code and other
legislation favoring the mining sector, the country has seen an
upswing in gold exploration and production. While the bitter
internal crisis in neighboring Cote d'Ivoire is beginning to be
resolved, it is still having a negative effect on Burkina Faso's
trade and employment. Burkina Faso received a Millennium Challenge
Corporation (MCC) threshold grant to improve girls' education at the
primary school level, and signed an MCC compact that focuses on the
areas of infrastructure, agriculture, and land reform in July 2008.

Burma
Burma, a resource-rich country, suffers from pervasive
government controls, inefficient economic policies, and rural
poverty. Despite Burma's increasing oil and gas revenue,
socio-economic conditions have deteriorated because of the regime's
mismanagement of the economy. The economy suffers from serious
macroeconomic imbalances - including rising inflation, fiscal
deficits, multiple official exchange rates that overvalue the
Burmese kyat, a distorted interest rate regime, unreliable
statistics, and an inability to reconcile national accounts to
determine a realistic GDP figure. Most overseas development
assistance ceased after the junta began to suppress the democracy
movement in 1988 and subsequently refused to honor the results of
the 1990 legislative elections. In response to the government of
Burma's attack in May 2003 on AUNG SAN SUU KYI and her convoy, the
US imposed new economic sanctions in August 2003 including a ban on
imports of Burmese products and a ban on provision of financial
services by US persons. Further, a poor investment climate hampers
the inflow of foreign investment. Foreign investors have shied away
from nearly every sector except for natural gas and power
generation. The business climate is widely perceived as opaque,
corrupt, and highly inefficient. The most productive sectors will
continue to be in extractive industries - especially oil and gas,
mining, and timber - with the latter causing significant
environmental degradation. Other areas, such as manufacturing and
services, are struggling with inadequate infrastructure,
unpredictable import/export policies, deteriorating health and
education systems, and endemic corruption. A major banking crisis in
2003 shuttered 20 private banks and disrupted the economy. As of
2008, the largest private banks operated under tight restrictions,
limiting the private sector's access to formal credit. The September
2007 crackdown on prodemocracy demonstrators, including thousands of
monks, strained the economy as the tourism industry, which directly
employs about 500,000 people, suffered dramatic declines in foreign
visitor levels. In November 2007, the European Union announced new
sanctions banning investment and trade in Burmese gems, timber, and
precious stones, while the United States expanded its sanctions list
to include more Burmese government and military officials and their
family members, as well as prominent regime business cronies, their
family members, and associated companies. Official statistics are
inaccurate. In July 2008 the President signed into law the Tom
LANTOS JADE (Junta's Anti-Democratic Efforts) Act of 2008, imposing
new targeted sanctions on the regime. Published statistics on
foreign trade are greatly understated because of the size of the
black market and unofficial border trade - often estimated to be as
large as the official economy. Though the Burmese government has
good economic relations with its neighbors, better investment and
business climates and an improved political situation are needed to
promote serious foreign investment, exports, and tourism.

Burundi
Burundi is a landlocked, resource-poor country with an
underdeveloped manufacturing sector. The economy is predominantly
agricultural with more than 90% of the population dependent on
subsistence agriculture. Economic growth depends on coffee and tea
exports, which account for 90% of foreign exchange earnings. The
ability to pay for imports rests primarily on weather conditions and
international coffee and tea prices. The Tutsi minority, 14% of the
population, dominates the coffee trade. An ethnic-based war that
lasted for over a decade resulted in more than 200,000 deaths,
forced more than 48,000 refugees into Tanzania, and displaced
140,000 others internally. Only one in two children go to school,
and approximately one in 15 adults has HIV/AIDS. Food, medicine, and
electricity remain in short supply. Burundi's GDP grew around 4%
annually in 2006-08. Political stability and the end of the civil
war have improved aid flows and economic activity has increased, but
underlying weaknesses - a high poverty rate, poor education rates, a
weak legal system, and low administrative capacity - risk
undermining planned economic reforms. Burundi will continue to
remain heavily dependent on aid from bilateral and multilateral
donors; the delay of funds after a corruption scandal cut off
bilateral aid in 2007 reduced government's revenues and its ability
to pay salaries.