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Economy of Eritrea

The Economy of Eritrea has experienced considerable growth in recent years, indicated by an improvement in Gross domestic product (GDP) in October 2012 of 7.5 percent over 2011. However, worker remittances from abroad are estimated to account for 32 percent of gross domestic product. Eritrea has an extensive amount of resources such as copper, gold, granite, marble, and potash. The Eritrean economy has undergone extreme changes due to the War of Independence.

In 2011, Eritrea's GDP grew by 8.7 percent making it one of the fastest growing economies in the world. The Economist Intelligence Unit (EIU) expects it to maintain a high growth rate of 8.5 percent in 2013.

Eritrea's GDP, estimated at $4.037 billion in 2011, is 8.7 percent above the GDP in 2010. The growth was due to increased agricultural output and the expansion of the mining industry along with increasing gold prices.

Industries

Agriculture, Forestry, and Fishing

The agricultural sector has improved with the use of modern farming equipment and techniques, and dams. Nevertheless, it is compromised by a lack of financial services and investment. Major agricultural products are barley, beans, dairy products, lentils, meat, millet, leather, sorghum, teff, and wheat.

Although forestry is not a significant economic activity in Eritrea, its forested area covers 1,585,000 hectares (3,920,000 acres), or 13.5 percent of the total land area. Total roundwood production in 2004 was 1,266,000 cubic meters, nearly all of it used for fuel.

Reliable figures on the extent and value of the fishing industry in Eritrea are difficult to obtain. However, Eritrea's long coastline offers the opportunity for significant expansion of the fishing industry from its current, largely artisanal, stage. Eritrea exports fish and sea cucumbers from the Red Sea to markets in Europe and Asia, and there is hope that the construction of a new, jet-capable airport in Massawa, as well as rehabilitation of the port there, may support increased exports of high-value seafood.

Animal husbandry

Sheep, goats, cattle (especially zebu), and camels make up the majority of Eritrea's livestock.

Mining and minerals

Eritrea's substantial mineral deposits are largely unexplored.

The government of Eritrea reportedly is in the process of conducting a geological survey for use by potential investors in the mining sector. The presence of hundreds of thousands of land mines in Eritrea, particularly along the border with Ethiopia, presents a serious impediment to future development of the mining sector.

Industry and Manufacturing

Manufactured items in 2002 included beverages, processed foods, tobacco, leather, textiles, metal products, chemicals, printing, nonmetallic minerals, construction materials, salt, paper, and matches. The oil industry has potential, as major oil deposits are believed to lie under the Red Sea.

In 2005, industry had a 26.3% share of the GDP; since 2011, it has grown to 34%. Recent industries include food processing, beverages, clothing and textiles, salt, cement, and commercial ship repair.

Energy

According to the U.S. Department of Commerce, opportunities exist for both on- and offshore oil and natural gas exploration; however, these prospects have yet to come to fruition. The use of Wind energy and solar power have slightly increased, due to the growth of solar power manufacturing companies in the country. The Eritrean government has expressed interest in developing alternative energy sources, including geothermal, solar, and wind power.

Services

In 2011, services accounted for 55 percent of gross domestic product. Financial services, the bulk of the services sector, are principally rendered by the National Bank of Eritrea(the nation's central bank), the Commercial Bank of Eritrea, the Housing and Commerce Bank of Eritrea, the Agricultural and Industrial Bank of Eritrea, the Eritrean Investment and Development Bank, and the National Insurance Corporation of Eritrea.

Tourism

Eritrea's lack of access to funds, the presence of large numbers of land mines, and the continued tensions that flare up between Eritrea and its neighbours have deterred the development of a tourist industry in Eritrea. According to the World Tourism Organization, international tourism receipts in 2002 were only US$73 million.

This article is licensed under the GNU Free Documentation License. It uses material from the Wikipedia article "Economy Of Eritrea"

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