ECONOMICS

 

Main Crops: copra, taro, breadfruit, sweet potatoes, vegetables; fish

Natural Resources: phosphate

Major Industries: fishing, handicrafts

A remote country of 33 scattered coral atolls, Kiribati has few natural resources and is one of the least developed Pacific Island countries. Commercially viable phosphate deposits were exhausted by the time of independence from the United Kingdom in 1979. Earnings from fishing licenses and seafarer remittances are important sources of income. Although the number of seafarers employed declined due to changes in global shipping demands, remittances are expected to improve with more overseas temporary and seasonal work opportunities for Kiribati nationals.

Economic development is constrained by a shortage of skilled workers, weak infrastructure, and remoteness from international markets. The public sector dominates economic activity, with ongoing capital projects in infrastructure including road rehabilitation, water and sanitation projects, and renovations to the international airport, spurring some growth. Public debt increased from 23% of GDP at the end of 2015 to 25.8% in 2016.

Kiribati is dependent on foreign aid, which was estimated to have contributed over 32.7% in 2016 to the government’s finances. The country’s sovereign fund, the Revenue Equalization Reserve Fund (RERF), which is held offshore, had an estimated balance of $855.5 million in late July 2016. The RERF seeks to avoid exchange rate risk by holding investments in more than 20 currencies, including the Australian dollar, US dollar, the Japanese yen, and the Euro. Drawdowns from the RERF helped finance the government’s annual budget.

 

 

	1990	2000	2010	2020
GNI, Atlas method (current US$) (billions)	0.05	0.11	0.21	0.35
GNI per capita, Atlas method (current US$)	720	1,330	2,040	2,910
GNI, PPP (current international $) (billions)	0.11	0.22	0.26	0.48
GNI per capita, PPP (current international $)	1,520	2,560	2,500	4,050
GDP (current US$) (billions)	0.04	0.07	0.16	0.18
GDP growth (annual %)	-0.9	6.3	-1.1	-0.5
Inflation, GDP deflator (annual %)	-1.1	2	0.8	3.3
Agriculture, forestry, and fishing, value added (% of GDP)	11	20	24	26
Industry (including construction), value added (% of GDP)	5	10	12	10
Exports of goods and services (% of GDP)	20	12	12	10
Imports of goods and services (% of GDP)	118	93	79	89
Gross capital formation (% of GDP)	66	..	14	32
Revenue, excluding grants (% of GDP)	..	..	55	108.7
Net lending (+) / net borrowing (-) (% of GDP)	..	..	-7.2	30.2
States and markets
Time required to start a business (days)	..	21	31	31
Domestic credit provided by financial sector (% of GDP)	..	..	..	..
Tax revenue (% of GDP)	..	..	17.7	26.3
Military expenditure (% of GDP)	..	..	..	..
Mobile cellular subscriptions (per 100 people)	0	0.4	10.3	45.8
Individuals using the Internet (% of population)	0	1.8	9.1	38
High-technology exports (% of manufactured exports)	..	..	..	8
Statistical Capacity Score (Overall Average) (scale 0 - 100)	..	..	37	42
Global links
Merchandise trade (% of GDP)	75	65	50	78
Net barter terms of trade index (2000 = 100)	..	100	103	124
External debt stocks, total (DOD, current US$) (millions)	..	..	..	..
Total debt service (% of exports of goods, services and primary income)	..	..	..	..
Net migration (thousands)	-4	-2	-4	-4
Personal remittances, received (current US$) (millions)	5	..	16	15
Foreign direct investment, net inflows (BoP, current US$) (millions)	0	1	-7	3
Net official development assistance received (current US$) (millions)	19.3	16.9	23.8	58