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- GDP (PPP):
- $3.3 billion
- 4.4% growth
- 2.1% 5-year compound annual growth
- $1,646 per capita
- Inflation (CPI):
- FDI Inflow:
The Gambia relies primarily on agriculture, tourism, and remittances to support its economy, leaving itself vulnerable to global market shocks. Gradual reforms in fiscal policies have helped to improve stability and growth in the economy. The Gambia has a fairly open foreign investment system, but serious government corruption and human rights issues hinder investment inflows.
Tariffs on imports, including additional duties on certain agricultural goods during harvesting season, undermine competition and decrease choices for individuals. Corruption remains pervasive, and protection of property rights is weak, undermining the rule of law. State-owned enterprises are present in many sectors, and supporting them is a major source of the government’s debt.
President Yahya Jammeh, who came to power in a bloodless coup in 1994, won his fourth term in 2011 in flawed elections. His Alliance for Patriotic Reorientation and Construction won a major victory in the 2012 legislative elections, which were boycotted by opposition parties. Despite constitutional guarantees of a number of basic rights, Jammeh’s regime is one of the most authoritarian on the continent, a fact that led the U.S. to expel The Gambia from the African Growth and Opportunity Act and the Millennium Challenge Corporation. Government revenue depends heavily on peanut exports, leaving the state vulnerable to price fluctuations and market shocks.
Protection of property rights is weak. There are multiple overlapping land tenure systems, and many properties are subject to expropriation by the government. Although the constitution provides for an independent judiciary, the president selects and dismisses judges, and they usually defer to his wishes. The judicial system recognizes both customary law and Sharia (Islamic) law. Official corruption and impunity are serious problems.
The top personal income tax rate is 35 percent, and the top corporate tax rate is 32 percent. Other taxes include a capital gains tax and a sales tax. The overall tax burden equals 16.1 percent of total domestic income. Government spending has amounted to 29.2 percent of total output (GDP) over the past three years, and budget deficits have averaged 8.3 percent of GDP. Public debt is equivalent to 91.6 percent of GDP.
Regulatory inefficiency continues to hamper the business environment. Chronically high unemployment and underemployment persist in the inefficient labor market. The large financial deficits of the National Water and Electricity Company and other public enterprises are a particularly acute problem; in 2015, one state-owned enterprise was instructed to sell imported fertilizer at below cost.
Trade is important to The Gambia’s economy; the value of exports and imports taken together equals 58 percent of GDP. The average applied tariff rate is 12.5 percent. Foreign and domestic investors are generally treated equally under the law. Credit to the private sector has gradually increased, although supervision and regulation remain deficient. Capital markets consist only of government securities; there is no stock exchange.