San Marino: Economic Outline
For the latest updates on the key economic responses from governments to adress the economic impact of the COVID-19 pandemic, please consult the IMF's policy tracking platform Policy Responses to COVID-19.
San Marino's economy has failed to fully recover since the financial crisis of 2008. Furthermore, deep-rooted weaknesses in the banking sector - the backbone of the economy - coupled with disrupted credit supply have stalled growth in recent years. The COVID-19 pandemic has caused the San Marino economy to collapse, with GDP estimated at -6.5% in 2020. Nevertheless, GDP rebounded by 5.5% in 2021, also thanks to an uptick in tourist arrivals over the summer and autumn months. The IMF forecasts GDP growth at 3.7% this year and 1.5% in 2023, although the country’s economy is highly exposed to European economic conditions and may be negatively affected by the consequences of the ongoing conflict in Ukraine.
San Marino's economy, which is akin to an offshore banking model, collapsed following the introduction of anti-tax measures by Italy and against a backdrop of weak external demand. San Marino's cumulative GDP recession since 2008 is the second-worst in Europe after Greece. While the country was finally removed from the black list of tax havens compiled by Italy in 2014, macroeconomic and financial soundness indicators have not improved significantly since that date. The country's oversized banking sector has dwindled and been left with low liquidity as many non-residents withdrew their money. The Republic of San Marino was under strong international pressure to strengthen cooperation with foreign tax authorities and render its banking system more transparent. Rebalancing of public accounts and the fight against money laundering and terrorist financing remain high in the country's priorities. The country’s debt-to-GDP ratio skyrocketed to 94.6% in 2021, compared to a pre-pandemic level of 62.9%. The IMF expects the ratio to follow a downward trend in the forecast horizon (92.5% and 91.7% in 2022 and 2023, respectively), but risks related to the materialisation of additional contingent liabilities from the banking sector persist (the government issued EUR 207 million in bonds to former depositors of Banca CIS, assuming ownership of the bank in June 2021). The 2021 fiscal government deficit was estimated at 5.7% of GDP by Fitch Ratings due to the under-execution of expenditure and stronger revenue growth supported by a dynamic labour market and an increase in cross-border shopping. The deficit is forecasted to narrow to 2.3% this year and 2.1% in 2023. Higher global energy and electricity prices pushed inflation to 0.8% in 2021 (IMF). Fitch Ratings expects inflation to average 3% in 2022.
San Marino has a high standard of living and offers several social benefits, which contribute to the good living conditions of the country's inhabitants. Despite the negative economic impact of the COVID-19 pandemic, unemployment decreased in 2021, reaching 6.4% (national office of statistics).
| Main Indicators | 2020 | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|---|
| GDP (billions USD) | 1.54 | 1.70 | 1.62 | 1.62 | 1.68 |
| GDP (Constant Prices, Annual % Change) | -6.7 | 5.4 | 3.1 | 0.8 | 1.1 |
| GDP per Capita (USD) | 45,641 | 50,196 | 47,700 | 47,484 | 49,017 |
| General Government Gross Debt (in % of GDP) | 71.6 | 89.2 | 86.5 | 88.0 | 87.7 |
| Inflation Rate (%) | 0.2 | 2.1 | 6.9 | 4.5 | 1.5 |
| Current Account (billions USD) | 0.04 | 0.07 | 0.02 | 0.01 | 0.02 |
| Current Account (in % of GDP) | 2.8 | 4.0 | 1.4 | 0.8 | 1.4 |
Source: IMF – World Economic Outlook Database - October 2021.
Note: (e) Estimated Data
| Monetary Indicators | 2016 | 2017 | 2018 | 2019 | 2020 |
|---|---|---|---|---|---|
| Euro (EUR) - Average Annual Exchange Rate For 1 MUR | 0.03 | 0.03 | 0.02 | 0.03 | 0.02 |
Source: World Bank - Latest available data.
San Marino's agriculture includes wheat, grapes, corn, olives, cattle, pigs, horses, beef, cheese, and hides.
The country's most important industries are tourism, banking, textiles, electronics, ceramics, cement, and wine. San Marino is also known for its furniture, its collectible stamps, and its collectible coins.
| Breakdown of Economic Activity By Sector | Agriculture | Industry | Services |
|---|---|---|---|
| Value Added (in % of GDP) | 0.0 | 35.6 | n/a |
| Value Added (Annual % Change) | -13.8 | n/a | n/a |
Source: World Bank - Latest available data.
| Socio-Demographic Indicators | 2022 | 2023 (e) | 2024 (e) |
|---|---|---|---|
| Unemployment Rate (%) | 5.9 | 5.7 | 5.7 |
Source: IMF – World Economic Outlook Database - Latest available data
See the country risk analysis provided by Coface.
The Indicator of Political Freedom provides an annual evaluation of the state of freedom in a country as experienced by individuals. The survey measures freedom according to two broad categories: political rights and civil liberties. The ratings process is based on a checklist of 10 political rights questions (on Electoral Process, Political Pluralism and Participation, Functioning of Government) and 15 civil liberties questions (on Freedom of Expression, Belief, Associational and Organizational Rights, Rule of Law, Personal Autonomy and Individual Rights). Scores are awarded to each of these questions on a scale of 0 to 4, where a score of 0 represents the smallest degree and 4 the greatest degree of rights or liberties present. The total score awarded to the political rights and civil liberties checklist determines the political rights and civil liberties rating. Each rating of 1 through 7, with 1 representing the highest and 7 the lowest level of freedom, corresponds to a range of total scores.
Political freedom in the world (interactive map)
Source: Freedom in the World Report, Freedom House
Any Comment About This Content? Report It to Us.
© eexpand, All Rights Reserved.
Latest Update: February 2023
