Economy of Tuvalu

Economy - overview: Tuvalu consists of a densely populated, scattered group of nine coral atolls with poor soil. The country has no known mineral resources and few exports. Subsistence farming and fishing are the primary economic activities. Government revenues largely come from the sale of stamps and coins and worker remittances. About 1,000 Tuvaluans work in Nauru in the phosphate mining industry. Nauru has begun repatriating Tuvaluans, however, as phosphate resources decline. Substantial income is received annually from an international trust fund established in 1987 by Australia, New Zealand, and the United Kingdom and supported also by Japan and South Korea. Thanks to wise investments and conservative withdrawals, this Fund has grown from an initial $17 million to over $35 million in 1999. The US government is also a major revenue source for Tuvalu, with 1999 payments from a 1988 treaty on fisheries at about $9 million, a total which is expected to rise annually. In an effort to reduce its dependence on foreign aid, the government is pursuing public sector reforms, including privatization of some government functions and personnel cuts of up to 7%. In 1998, Tuvalu began deriving revenue from use of its area code for "900" lines and from the sale of its ".tv" Internet domain name. Royalites from these new technology sources could raise GDP three or more times over the next decade. Low-lying Tuvalu is particularly vulnerable to any rise in the sea level from future global warming.

GDP: purchasing power parity - $7.8 million (1995 est.)

GDP - real growth rate: 8.7% (1995 est.)

GDP - per capita: purchasing power parity - $800 (1995 est.)

GDP - composition by sector:
agriculture: NA%
industry: NA%
services: NA%

Population below poverty line: NA%

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

Inflation rate (consumer prices): 3.9% (average 1985-93)

Labor force: NA

Labor force - by occupation: people make a living mainly through exploitation of the sea, reefs, and atolls and from wages sent home by those working abroad (mostly workers in the phosphate industry and sailors)

Unemployment rate: NA%

Budget:
revenues: $4.3 million
expenditures: $4.3 million, including capital expenditures of $NA (1989 est.)

Industries: fishing, tourism, copra

Industrial production growth rate: NA%

Electricity - production: 3 million kWh (1995)

Electricity - production by source:
fossil fuel: NA%
hydro: NA%
nuclear: NA%
other: NA%

Electricity - consumption: 3 million kWh (1995)

Electricity - exports: 0 kWh (1995)

Electricity - imports: 0 kWh (1995)

Agriculture - products: coconuts; fish

Exports: $165,000 (f.o.b., 1989)

Exports - commodities: copra

Exports - partners: Fiji, Australia, New Zealand

Imports: $4.4 million (c.i.f., 1989)

Imports - commodities: food, animals, mineral fuels, machinery, manufactured goods

Imports - partners: Fiji, Australia, New Zealand

Debt - external: $NA

Economic aid - recipient: $7.9 million (1995); note - substantial annual support from an international trust fund

Currency: 1 Tuvaluan dollar ($T) or 1 Australian dollar ($A) = 100 cents

Exchange rates: Tuvaluan dollars ($T) or Australian dollars ($A) per US$1 - 1.5207 (January 2000), 1.5497 (1999), 1.5888 (1998), 1.3439 (1997), 1.2773 (1996), 1.3486 (1995)

Fiscal year: calendar year

See also : Tuvalu