San Marino Economy Facts

by ebizdir · Published January 30, 2023 · Updated February 22, 2023

Economical overview

San Marino’s economy is mainly based on various services, such as tourism, banking and finance, as well as light manufacturing. Tourism accounts for about half of San Marino’s gross domestic product (GDP), as much as the financial and industrial sectors account for. The sale of own stamps and collector coins is also an important source of income for the state. Since 2002, San Marino has been authorized to mark its own euro coins.

The close economic ties with Italy mean that San Marino’s economy is strongly affected by developments in neighboring countries. This became clear during the international financial crisis and the subsequent euro crisis of 2008 (see below).

Countryaah.com: Major imports by San Marino, covering a full list of top products imported by the country and trade value for each product category.

In ancient times, the people of San Marino mainly depended on agriculture and the income from the mining of limestone from the Titan Mountain.

From the 1980s, the development of the banking and finance sector contributed to a sharp increase in economic growth. But San Marino was also identified as a so-called tax haven with suspected money laundering, that is, authorities suspected that criminals used the country’s financial institutions to launder black money whites, and even to fund terrorism.

Abbreviationfinder.org: Check this abbreviation website to find three letter ISO codes for all countries in the world, including SMR which represents the country of San Marino. Check findjobdescriptions to learn more about San Marino.

In the 1990s, San Marino was criticized by the OECD Economic Cooperation Organization for its banking secrecy and the pressure to ease its secrecy to prevent tax evasion increased after the turn of the millennium. In 2003, the OECD threatened with sanctions, since San Marino was listed as one of the seven countries in the world, where it was most difficult to obtain bank account information. Since then, San Marino has gradually improved its transparency, and in 2011, San Marino was removed from the OECD’s gray list of tax havens.

With Italy, however, the collaboration tightened, and Italians smuggled cash into San Marino to avoid a stiff tax control in Italy. Only after several years of political developments, in June 2012, San Marino and Italy were able to sign an agreement on exchange of information on bank balances. It was seen as a key to improved financial and economic cooperation between the two countries, which in turn was crucial to San Marino’s opportunities to improve its economy.

Growth in San Marino’s economy was strong in the early 2000s, averaging about 3.5 percent plus annually in 2000–2007. When the international financial crisis hit, GDP fell by minus 3.4 percent in 2008 and a dramatic fall of 12.8 percent in 2009. The decline slowed to 5.2 percent in 2010, and in 2014, according to preliminary figures, it was down to -1 percent. At the same time, since the beginning of the crisis, tax revenue had fallen by a third in four years, and the budget had gone from balance to a deficit of more than 3 percent of GDP.

But for 2015, it was estimated to be a small GDP surplus of 1 percent, and in a report in the spring of 2016, the International Monetary Fund (IMF) was able to show that San Marino’s economy has begun to recover. This was partly due to an upturn in the Italian economy and the government’s austerity measures, including an extra income tax and the introduction of property taxes. From 2017, VAT will also be introduced.

San Marino is part of a customs union with Italy, and the economy is closely intertwined with the Italian. About 90 percent of San Marino’s exports go to Italy. As compensation for San Marino handing over the customs checks to Italy and thus losing out on, among other things, customs duties, Italy pays an annual sum to San Marino. During the euro crisis, economic and financial cooperation between the two countries has been put to the test (see Current policy).