ce
base, including serious water shortages exacerbated by cycles of
long-term drought. The economy is service-oriented, with commerce,
transport, tourism, and public services accounting for 66% of GDP.
Although nearly 70% of the population lives in rural areas, the
share of food production in GDP in 2004 was only 12%, of which
fishing accounted for 1.5%. About 82% of food must be imported. The
fishing potential, mostly lobster and tuna, is not fully exploited.
Cape Verde annually runs a high trade deficit, financed by foreign
aid and remittances from emigrants; remittances supplement GDP by
more than 20%. Economic reforms are aimed at developing the private
sector and attracting foreign investment to diversify the economy.
Future prospects depend heavily on the maintenance of aid flows, the
encouragement of tourism, remittances, and the momentum of the
government's development program. Cape Verde has been exploring
European Union membership in recent years.

Cayman Islands
With no direct taxation, the islands are a thriving
offshore financial center. More than 68,000 companies were
registered in the Cayman Islands as of 2003, including almost 500
banks, 800 insurers, and 5000 mutual funds. A stock exchange was
opened in 1997. Tourism is also a mainstay, accounting for about 70%
of GDP and 75% of foreign currency earnings. The tourist industry is
aimed at the luxury market and caters mainly to visitors from North
America. Total tourist arrivals exceeded 2.1 million in 2003, with
about half from the US. About 90% of the islands' food and consumer
goods must be imported. The Caymanians enjoy one of the highest
outputs per capita and one of the highest standards of living in the
world.

Central African Republic
Subsistence agriculture, together with
forestry, remains the backbone of the economy of the Central African
Republic (CAR), with more than 70% of the population living in
outlying areas. The agricultural sector generates more than half of
GDP. Timber has accounted for about 16% of export earnings and the
diamond industry, for 40%. Important constraints to economic
development include the CAR's landlocked position, a poor
transportation system, a largely unskilled work force, and a legacy
of misdirected macroeconomic policies. Factional fighting between
the government and its opponents remains a drag on economic
revitalization. Distributi