Why Is Andorra Poor? A Resolved Issue or Still at Risk?

Although Andorra is a part of Europe, this small chunk of land skirts above the poverty line. Andorrans narrowly avoid poverty through trade alone, meaning one decision or mistake could lead people to asking: why is Andorra poor?

Andorra’s independence has successfully lasted about 150 years, yet only 5 percent of their land is arable. Andorrans rely on Spain for 63.6 percent of consumer goods, food, fuel and electricity, while France provides them with 15.8 percent and Germany 3.1 percent of their resources. Andorra imports a total of 82.5 percent of these resources that are necessary for survival.

Without trade, Andorra would fall drastically below the poverty line because the land cannot support the population. Furthermore, Andorra does not contain an airport, thus they can only rely on neighboring countries for imported goods. If Andorra built an airport and made trade connections with multiple countries, it would not be as vulnerable.

Luckily, Andorra has made other improvements to help it remain above the poverty line, such as a recent decline in their unemployment rate from 4.1 percent in 2015 to 3.7 percent in 2016. The infant mortality rate has also fallen from 7 per 1,000 in 1990 to 3 per 1,000 in 2012.

Andorra’s basic education remains free for residents and they provide three different school systems to address the various language barriers. They have an Andorran, French and Spanish school system. The diversity in education allows greater access for children to become educated, leading to economic success.

It is not as if Andorrans have not considered the disadvantages of their trade-reliant society. In 2006, “the Andorran government began sweeping economic reforms” hoping for economic growth. The government also passed foreign investment laws in both 2008 and 2012.

Andorrans live prosperously, while also hoping they will never be asked: why is Andorra poor?

Brianna White

Photo: Flickr