The economy has enjoyed a long period of sustained economic growth since emerging from recession in the late 1990s, with an average growth rate of 6.2% between 1998 and 2004.
This is an impressive performance by international standards.
The dominant industries in the economy are wholesale and retail trade (23.1% of GDP in 2004), agriculture and fishing (15.1%), restaurants and accommodation (15.0%), transport and communi-cation (12.5%) and public administration (12.1%). Between them, these five industries account for around 78% of economic activity in the Cook Islands
With the exception of public administration, these industries have also been the dominant drivers of economic growth in recent years. The other four industries listed above contributed 89% of total economic growth over the period 1998 to 2004.
The most recent GDP data suggest a continued strong performance, with economic growth of 5.6% in 2004. This is higher than had previously been expected, but is consistent with partial indicators of economic activity. The main contributors to growth in 2004 were agriculture and fishing, wholesale and retail trade, and construction.
As noted previously, underlying growth in the economy remains strong. Indeed, the better than expected GDP figures for 2004 and strong economic performance in the June and September quarters 2005 have led to some upward revisions to the growth projections.
- • In the 2005-06 Budget, real GDP growth was projected at 2.5% in 2004-05 and 2.4% in 2005-06.
- • It is now estimated that real GDP grew by around 4.2% in 2004-05. Growth is projected at around 3.0% in 2005-06 before returning to a long-term growth rate of around 3.5% in the out years. GDP per capita measures the value of output per person, and hence provides a good measure of living standards. As discussed in section 3.1, there are a number of issues relating to the estimates of resident population. For this reason, the estimates below are based on total population rather than resident population.
GDP per capita was around $12,900 in 2004. Real GDP per capita has grown strongly during the recent period of economic growth. Between 1998 and 2004, it increased by an average of 3.5% per year, with real GDP growth of 6.2% and population growth of only 2.6% per year.
In 2004, however, real GDP per capita is estimated to have declined by 4.3%, with population increasing faster than economic growth.
Complete report: MFEM, Half Year Economic and Fiscal Update