ern of public expenditure. The current administration
has made it a priority to pass the necessary reforms to implement
the US-Central American Free Trade Agreement (CAFTA). CAFTA
implementation would result in an improved investment climate.

Cote d'Ivoire
Cote d'Ivoire is among the world's largest producers
and exporters of coffee, cocoa beans, and palm oil. Consequently,
the economy is highly sensitive to fluctuations in international
prices for these products and weather conditions. Despite government
attempts to diversify the economy, it is still heavily dependent on
agriculture and related activities, engaging roughly 68% of the
population. Growth was negative in 2000-03 because of the difficulty
of meeting the conditions of international donors, continued low
prices of key exports, foreign divestment and civil war. Political
turmoil has continued to damage the economy since 2004, with a
rising risk premium associated with doing business in the country,
foreign investment shriveling, transportation costs increasing,
French businesses fleeing, and criminal elements that traffic in
weapons and diamonds gaining ground. The government will continue to
survive financially off of the sale of cocoa, which represents 90%
of foreign exchange earnings, but the government will probably lose
between 10% and 20% of its cocoa harvest to northern rebels who
smuggle the cocoa they control to neighboring countries where cocoa
prices are higher. The government remains hopeful that ongoing
exploration of Cote d'Ivoire's offshore oil reserves will result in
significant production that could boost daily crude output from
roughly 33,000 barrels per day (b/d) to more than 200,000 b/d by the
end of the decade.

Croatia
Before the dissolution of Yugoslavia, the Republic of
Croatia, after Slovenia, was the most prosperous and industrialized
area with a per capita output perhaps one-third above the Yugoslav
average. The economy emerged from a mild recession in 2000 with
tourism, banking, and public investments leading the way.
Unemployment remains high, at about 17%, with structural factors
slowing its decline. While macroeconomic stabilization has largely
been achieved, structural reforms lag because of deep resistance on
the part of the public and lack of strong support from politicians.
Growth, while impressive at about 3% to 4% for the last several
years, has