Countries around the world have currencies, as well as goods and services that are traded internationally every day. For investors and traders, they use a variety of systems and tools to watch movement of different foreign exchange markets carefully, choosing the right time to buy and sell. Obviously, trading is the foundation of the world economics so having real time and historical information about any country’s currency is vital.
One such country is Djibouti, which offers both exporting and importing opportunities within the foreign exchange market. In this article, we wanted to focus on Djibouti trade to show people what this particular currency is doing. Keep in mind, most of the transactions for this country include Djibouti exports, and Djibouti imports. However, in the past two years Djibouti trade has been showing extreme growth in tourism.
One of the reasons that Djibouti exports and imports have become so vital to Djibouti trade is because this country is located on the Red Sea. Much of the country is barren, with only slight development in sectors of industrial and agricultural, most workers are unskilled, and the climate is extremely harsh. Even natural resources in Djibouti are limited. However, with this country being connected to the Red Sea, it has a strategic location as its most valued asset.
Because of the location, the majority of Djibouti exports and Djibouti imports have to do with its international refueling center and transshipment. Unfortunately, Djibouti trade was hit hard from 1991 to 1994 during a civil war but now with political stability, imports and exports are once again on target. In fact, in the past seven years, Djibouti trade has seen more than a 3% improvement.
The one challenge to handling all of Djibouti exports and Djibouti imports is that while the country is seeing stable growth in job creation, the current unemployment rate is still more than 50%. With this level of poverty, it has been extremely challenging to see vast improvements in Djibouti trade although country officials are working hard to improve the framework for both fiscal and macroeconomic situations.
Additionally, the Djibouti merchandise trade balance has experienced a significant deficit in part from the country’s huge need for imports but also the slim base of exports. Keep in mind, this country maintains a generous surplus specific to services balance but this surplus is still less than the deficit for the merchandise trade balance. Because of this, the entire country’s account balance is currently in deficit.
Even with facing many obstacles, it is still important to remember that being connected to the Red Sea provides Djibouti trade a unique opportunity. For instance, for sea transportation companies needing refueling and fuel bunkering, the Port of Djibouti is unrivaled. In addition, numerous African countries use the transport facilities for assisting with re-export of goods. This has resulted in an even inflow of help from foreign countries. In fact, this port serves as a base to one of France’s smaller naval facilities.
The bottom line is that for Djibouti trade, the economy is dependent primarily on service activities that have to do with the location to the Red Sea, as well as the status of being a free trade zone within the Horn of Africa. Therefore, with Djibouti exports and Djibouti imports involving both regional and internationally refueling and transshipment, officials anticipate the country will continue to see slow increases in employment to help further stabilize this part of the world.