Country Report Djibouti November 2006

Outlook for 2007-08: External sector

Exports are forecast to rise steadily in 2007-08, but rising investment and public spending will result in a sharper increase in imports and a consequent widening of the trade deficit. However, rising inflows on the services account as activity in the free zone and oil terminal takes off will keep the services account firmly in surplus. This, together with small surpluses on the income and current transfers accounts, will help to keep the current-account deficit broadly stable at an estimated 9.2% of GDP in 2006 and around 9% in 2007-08.

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