Gibraltar: Country and Foreign Investment
The Country and its Economy
The economy used to be substantially dominated by the British naval dockyard and military presence, but major cut-backs over the last few decades have reduced the share of such expenditure to a small fraction of the local economy. Magnificent port facilities remain, so that shipping and tourism are the mainstays of the economy. Several million people visit Gibraltar annually, many of them evidently stepping ashore from cruise liners (see below for recent visitor numbers). There is a fair amount of local construction work on the hotel/conferencing sector, and to accommodate wealthy expatriates.
The Government has primarily, however, pinned its hopes for the future on the financial services sector, which has been growing rapidly. Growth in the technology sector is also promising, with a number of large betting and gaming companies taking advantage of the low-tax regime and good telecommunications facilities.
The currency is the Gibraltar pound (£G) = 100 pence and is at par with the British pound. There are no exchange controls in Gibraltar.
In his first budget speech in 2012, the Chief minister Fabian Picardo, revealed the forecast for the economy for 2011/12 was growth of 5.1% to GIP 1,137m. He said that the Net Public Debt fell to 22% of GDP (GIP253.5m) in the same period while the government had an overall budget surplus of GBP31 million to 31 March 2012.
Inflation stood at 3.7% in 2011.
The budget speech included the fact that government surplus of GIP31 million was a record for the second year running. GDP was expected to be 5%, unemployment was 1.8%. Net public was 22% in the year ended March 2012 - well below the ceiling of 60% recommended by the EU.