Economy of Tuvalu - Government Revenue

Government Revenue

Government revenues largely come from sales of stamps and coins, fishing licenses, income from the TTF, and from the lease of its highly fortuitous .tv Internet Top Level Domain (TLD). In 1998, Tuvalu began deriving revenue from use of its area code for "900" lines and from the commercialisation of its ".tv" Internet domain name. Domain name income paid most of the cost of paving the streets of Funafuti and installing street lighting in mid-2002. The commercialisation of the ".tv" Internet domain name is managed by Verisign until 2021.

The Asian Development Bank described the Global Economic Crisis (GEC) as impacting on Tuvalu through: “(i) lower demand for Tuvalu seafarers and, therefore, falling remittances; (ii) volatile exchange rate movements affecting the value of remittances, revenues from fishing license fees, and food prices; and (iii) lower market value of the Tuvalu Trust Fund (TTF), which at the end of May 2010 was about 12% below the maintained value. Thus, as a direct result of the GEC, no distribution was made from the fund to the budget for 2010 and further distributions are unlikely while there is uncertainty in international financial markets.”

The IMF 2010 Country Report describes economic activity in Tuvalu as dampened by lower offshore earnings, with “he economy is expected to have almost no growth in 2010, and growth is projected to be zero or even turn negative in 2011, led by lower government spending, and remain low over the medium term.”