Country Report Djibouti November 2006

Outlook for 2007-08: Economic growth

Real GDP growth in 2006 is estimated to have risen to around 4.2%, partly as a result of the activities of foreign troops stationed in Djibouti, but largely owing to the strong growth of public and private investment, particularly in port infrastructure. Over the forecast period investment in new port equipment and systems will help to overcome handling problems at the existing port, and public and private investment in developing the new port complex at Doraleh will continue. The project, estimated to cost around US$400m over five to seven years, comprises three main elements: a commercial and industrial free zone, a container terminal, and an oil terminal. The oil terminal was inaugurated in February 2006, and work on the container terminal is due to be completed by 2008. The Economist Intelligence Unit therefore forecasts that real GDP growth will accelerate over the forecast period, to 4.7% in 2007 and 5% in 2008. Although drought ravaged the country in early 2006, agriculture's share of GDP-at just under 4%-means that real GDP growth rates are not heavily affected by weather patterns

© 2006 The Economist lntelligence Unit Ltd. All rights reserved
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