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THE ANDORRAN ECONOMY

The Andorran economy is undergoing a process of change. For a long time the Principality was a European 'shop window' for Spain, but when Spain joined the European Community in 1986, it became necessary to review the economic strategy of Andorra.

The Principality now attempts to diversify its resources. The low taxes on consumer goods make the country attractive for luxury goods (jewelry, leather goods, clothing, perfumes). The mainstay of the Andorran economy are services and tourism. Industrial activity is negligible, but the new economic strategy of diversification means that Andorra may in the near future welcome high-tech industries, specialised in pharmaceutics or optics, for instance.

Relations with the European Union (http://www.europa.eu.int) are regulated by a trade agreement signed on 28 June 1990, creating a customs union for industrial products and setting out special conditions for agricultural products (http://www.duana.ad). This framework agreement entered into force on 1 January 1991, with the customs regulations becoming effective on 1 July 1991, for an indefinite period. The agreement was enlarged in 1995, when Andorra asked for full privileges regarding the direct collection of the Common Exterior Tariff (CET).

For more detailed information about the economy of Andorra and more recent data about subjects such as public revenue, the budget, GNP and the trade balance, please consult the economic reports of the Chamber of Commerce, lndustry and Services of the Principality (http://www.ccis.ad).