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Problems and Prospects of a Small, Island Economy Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized

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Problems and Prospects of a Small, Island Economy Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized A WORLD BANK COUNTRY STUDY PUB-1626 Public Disclosure Authorized THE COMOROS Problems and Prospects of a Small, Island Economy Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized JULY 1979 THE COMOROS Problems and Prospects of a Small, Island Economy This report is based on the findings of a missionto the Comoros in November /December, 1976 consisting of: Messrs. P. Landell-Mills, chief of mission M. Ragno, general economist The report also incorporates the findings of a transport sector mission led by: Ms. F. Johansen, transport economist and including: Messrs. G. Orsini, road engineer D. Raymond, port specialist which visited the Comoros in March 1977. The report was revised for publication on the basis of discussionswith the Comorian gov- ernment and an economic review in December 1978 by Mr. S. Rahim. Eastern Africa Regional Office The World Bank Washington, D.C., U.S.A. The World Bank issues country economic studies in two series. This report is a working document and is, as such, part of an informal series based wholly on materials originally prepared for restricted use within the Bank. The text is not meant to be definitive, but is offered so as to make some results of internal research widely available to scholars and practitioners tbroughout the world. A second, morc formal series entitled World Bank Country Economic Reports is published for the Bank by The Johns Hopkins University Press, Baltimore and London. Titles of these and all other Bank publications may be found in the Catalog of Publications, which is available free of chargefrom World Bank, Publications Unit, 1818 H Street, N.W., Washington, D.C. 20433, U.S.A. This report is a free publication. A small charge may be made if airmail postage is required. The views and interpretations in this report are the authors' and should not be attributed to the World Bank, to its affiliated organizations, or to any individual acting in their behalf. Copyright © 1979 The International Bank for Reconstruction and Development/The World Bank The World Bank enjoys copyright under Protocol 2 of the Universal Copyright Conven- tion. Nevertheless, permission for reproduction of any part of this report is hereby granted provided that full citation is made. CURRENCYEQUIVALENTS Yearly Average 1968 US$1.00 - CFAF 246.85 CFAP 1 - US$0.0041 1969 US$1.00 - CFAF 259.71 CFAF 1 US$0.0039 1970 US$1.00 - CFAF 277.71 CFAF 1 US$0.0036 1971 US$1.00 - CFAF 277.03 CFAF 1 US$0.0036 1972 US$1.00 - CFAF 252.21 CFAF I US$0.0040 1973 US$1.00 - CFAF 222.70 CFAF 1 US$0.0045 1974 Us$1.00 - CFAF 240.50 CFAF 1 US$0.0042 1975 US$1.00 - CFAF 214.32 CFAF 1 US$0.0047 1976 Us$1.00 - CFAF 238.98 CFAF 1 US$0.0042 1977 US$1.00 CFAF 245.67 CFAF 1 US$0.0041 1978 US$1.00 = CFAF 225.64 CFAF 1 US$0.0044 FISCAL YEAR January 1st to December 31 THE ECONOMY OF THE COMOROS TABLE OF CONTENTS Page No. MAPS BASIC DATA SUMMARY AND CONCLUSIONS ........................... i-vii INTRODUCTION ................................................... 1 PART A: THE SETTING 1. THE COUNTRY ........................ 2 General Features ......................... ....... 2 Grande Comore .................................... 3 Anjouan .................................. 4 Mayotte ......................................................4 Moheli ....... .............................. 5 2. THE PEOPLE ............................................ 5 Their History ................................... 5 General Characteristics of the Population ....... 6 3. POLITICAL SITUATION ... ............................... 8 Recent Political and Institutional Developments.. 8 Institutional Changes ...........................10 4. PLANNING FOR DEVELOPMENT ............ .. ............... 10 The Need for Planninig ........................... 10 Strategy for Development ..... ...................11 PART B: STRUCTURE OF ECONOMIC ACTIVITIES AND RECENT TRENDS 1. SALIENT FEATURES OF THE ECONOMY ...................... 13 Production, Income and Investment ............... 13 Employment, Wages and Prices .................... 16 2. MONEY, BANKING AND CREDIT ........... ................. 20 The Monetary System ............... .............. 20 Recent Trends in Money and Credit .............. 23 TABLE OF CONTENTS (Continued) Page No. 3. EXTERNAL TRADE AND PAYMENTS ...... ...................26 Comoros Structural Trade Deficit ..... ............26 Export Performance ....... ........................27 Characteristics of Imports ..... ..................31 Balance of Payments ....... .......................33 4. PUBLIC FINANCE .......... ............................34 Overview ............. ............................34 Structure of Public Operations ..... ..............36 The Fiscal System and Recent Revenue Trends ...... 37 The Pattern of Government Expenditure .... ........ 39 Public Investment 1970-1975 ..... .................42 The Budgetary Situation After Independence ....... 42 PART C: THE SECTORS: CHARACTERISTICS AND ISSUES 1. THE RURAL SECTOR .44 Level and Trends in Agricultural Production .44 Competition between Different Land Uses .47 Agricultural Services .50 Problems and Prospects for the Principal Crops 52 The Need to Expand Food Production .57 Forestry: A Crisis Situation .58 Opportunities for Fisheries Development .60 2. INDUSTRY .62 Existing Manufacturing Activities .62 The Construction Industry .64 Potential for Industrial Diversification .65 3. TOURISM .66 4. PHYSICAL INFRASTRUCTURE .70 Transport Constraints .70 Sea Transport .71 Civil Aviation .72 Road Communications .74 Telecomunications and Postal Services .76 Power Supplies .77 Water Supplies .78 5. EDUCATION .79 6. HEALTH SERVICES ..................................... 84 TABLE OF CONTENTS (Continued) Page No. PART D: PROSPECTS AND EXTERNAL AID NEEDS 1. OUTLOOK FOR DEVELOPMENT . ........................... 86 2. SOME KEY DEVELOPMENT ISSUES .........................87 Explosive Population Growth: Need for a Population Policy . ......................... 87 Rural Development ...... ........................89 Diversification ...... ...... .. .. ................... 89 3. THE ROLE OF EXTERNAL ASSISTANCE .... .................90 PART E: ANNEXES ANNEX I: The Development of Transport ANNEX II: The New Constitution of October 1, 1978 ANNEX III: Statistical Tables LIST OF TEXT TABLES 1. Population by Island, Mid-1976 2. Growth of Production and Income 3. Sectoral Composition of GDP 4. Occupations of the Active Population, 1966 5. Registered Salaried Employment 6. Registered Salaried Employment by Island 7. Average Annual Salaries in Selected Sectors 8. Selected Price Indices 9. Assets and Liabilities of the Banking System 10. Distribution of Short-Term Credit to the Private Sector 11. Number and Amount of Loans made by CREDICOM 12. Rates of Interest 13. Summary of Foreign trade 14. Trends in Principal Export Commodities 15. Trends in Selected Imports 16. Imports Adjusted to Take into Account Goods in the Custom Warehouse 17. Foreign Trade Indices 18. Summary of Balance of Payments Estimates 19. Summary of Financial Situation 20. Central Government Current Revenue 1970-77 21. Government Expenditure 1970-77 22. Current Government Expenditure 23. Percentage Distribution of Current Government Expenditure by Sector, 1970 and 1975 24. Volume Indices for Principal Agricultural Products, 1952-75 25. Exports of Principal Agricultural Products, 1970-75 26. Principal Agricultural Exports by Island, 1974 27. Average Annual Value of Agricultural Exports by Island, 1973-74 28. Principal Food Crops, 1965 29. Land Capability by Type 30. Actual Land Use by Island, 1965 31. Some Data on Yields of Traditional and Improved Crop Varieties 32. Coconut Production and Consumption 33. Forest Areas, 1968 and 1974 34. Tourist Infrastructure 35. Total Number of Visitors 36. Proposed Investment in New Hotel Accommodation 37. New Registrations of Vehicles and Cumulative Total 38. Road Network 39. Electricity Production by EDC 40. School Enrollment 41. School Situation in 1978-79 42. Hospital Beds, 1976 43. Birth Rates .0 r4315 4312i 4302' 5 444 Mhi $1un1 - |0 . X - ? X AA.1--,'' 141 a< M,lsorejoeli tlm0 0; t0; =0 >'rsoniouli > Ouelo -,±AL C O~~~~~~~~~~eIo,>OAi ~CbMORO'4MayottetyE ISLANDS M n ;:i 0 i=;fff2 9XX > >,0 4- E 0f;:i; COMOROO SbWDS i Dimojo =iG$AN DE /COM OREF =tt .;. 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