Vatican City is also known as the Holy See. There are no big differences. It is the Holy See of the Catholic church, which has about 1.4 billion believers around the world. The Vatican’s annual budget for 2023 was $1.34 billion.
The Vatican is a city-state located in Rome, Italy. It’s the smallest country globally, both in terms of population and land area. a sovereign state governed by the Pope, the head of the Catholic Church. The Vatican is a unique entity that blends religious and political authority. It has laws, currency (the Euro), a postal service, and security forces.
There is not much public declaration on the Vatican’s wealth. However, it could be argued that the Vatican indirectly holds stakes in Catholic-affiliated businesses globally, such as Uganda’s Centenary Bank, through shares owned by dioceses. For example: 19 Catholic Dioceses own 31.7%; SIDI – Solidarité Internationale pour le Développement et l’Investissement (International Solidarity for Development and Investment) – 10.5%; Triodos SICAV II – Triodos Microfinance Fund (a sub-fund of Triodos SICAV II) – 7.5%; Triodos Custody B.V. – 7.5%; and others.
Key sources of income.
- Vatican GDP per capita is estimated at US$27,461. The Vatican’s income is from three primary sources. First, external donations (24%), including contributions from global dioceses. Second, Vatican City State revenues, notably from the Vatican Museums and the Institute for the Works of Religion (Vatican Bank). Self-generated funds from services like medical care and real estate. Only 20% of its vast real estate portfolio generates income; the remaining 80% supports the Church’s mission.
- The Vatican investment office made 32.27 million euros (about $35.2 million) in profit in 2022 and contributed the entire amount to the Vatican’s operating budget. The IOR(Vatican Bank) is not just a financial institution; it serves as a crucial component in the operational framework of the Vatican, helping to fund various charitable activities and support the Church’s global outreach.
- The Vatican’s financial portfolio includes investments in various sectors, including stocks and bonds. They also own a vast amount of real estate, including over 5,000 church and investment properties around the world. IOR gold is mainly deposited with the U.S. Federal Reserve, while medals and precious coins are kept in the IOR vaults.
Currency of the Vatican City
The euro is the official currency of the Vatican. The euro has been the official currency of Vatican City since 2002. It issues its coins and stamps. The Vatican does not print EURO banknotes.
IOR(“Vatican Bank”)
In their 2023 annual report, The Institute for the Works of Religion, commonly known as the Vatican Bank, reported a net income of 30.6 million euros (about $32.8 million) for 2023, a modest increase from the 29.6 million euros (about $31.6 million) in profit reported in 2022. The Istituto per le Opere di Religione ( “IOR”) is a financial institution founded on 27 June 1942.
- According to the IOR 2023 Annual report, clients as at 31 December 2023, comprised: Religious orders (Congregations – Associations of the faithful – Seminaries, colleges, universities – monasteries and convents) 48% Departments of the Roman Curia, Holy See and Vatican City State offices and nunciatures 28% episcopal conferences, dioceses and parishes 9% Cardinals, bishops and clergy 7% Vatican employees and pensioners 6% Foundations and other entities under Canon law 2%In February 2014, Pope FRANCIS created the Secretariat of the Economy to oversee financial and administrative operations of Vatican.
- Credit activity is residual and strictly subject to the constraints of the ASIF authorisation and limits established by the Board of Superintendence. Customers are provided with services in IoR offices located only in the Vatican City State. Total Client assets managed by IOR as at December 31, 2023, reached EUR 5.4 bn (2022: EUR 5.2bn)
- The Institute for the Works of Religion (IOR), known as the Vatican Bank, serves as a cornerstone of the Holy See’s financial operations, fulfilling five core functions to advance the Catholic Church’s global mission. First, it manages assets and deposits from Vatican-affiliated entities and individuals, ensuring prudent stewardship of resources entrusted to its care. Second, its primary mandate is to support the Church’s worldwide activities, channeling funds into initiatives that align with its spiritual and charitable objectives.
- Third, the IOR facilitates essential payment services, enabling seamless financial transactions for Vatican institutions, clergy, and affiliated organizations. Fourth, it prioritizes financial stability and transparency, adhering to rigorous standards to safeguard assets and maintain trust.
Vatican and the United Kingdom trade
- According to the Vatican and UK Trade Fact Sheet, total trade in goods and services (exports plus imports) between the UK and Vatican City was £2 million in the four quarters to the end of Q3 2024, an increase of 100.0% or £1 million in current prices from the four quarters to the end of Q3 2023. In the four quarters to the end of Q3 2024, Vatican City was the UK’s 214th largest trading partner.
- The top goods imported to the UK from Vatican City during the four quarters to the end of Q3 2024 were vegetables, fruit, specialised machinery, sugar, paper, and paperboard. The UK reported a total trade surplus of £2 million with Vatican City, compared to a trade deficit of £1 million in the four quarters to the end of Q3 2023.
- In the four quarters to the end of Q3 2024, the UK had a trade in goods balance of less than £1 million with Vatican City, compared to a trade in goods balance of less than £1 million in the four quarters to the end of Q3 2023.
- UK imports in services (percentage of total UK imports that were services)were less than £1 million a decrease of 100.0% or £4 million in Value in 2023.UK Foreign Direct Investment (FDI) with Vatican City was Less than £500 thousand in 2023
- Total trade in goods and services (exports plus imports) between the UK and Vatican City was £2 million in the four quarters to the end of Q3 2024, an increase of 100.0% or £1 million in current prices from the four quarters to the end of Q3 2023.
Supervisory and Financial Information Authority
According to the Vatican Supervisory and Financial Information Authority Report, the cross-border cash declarations, in 2024, ASIF recorded 137 incoming declarations, amounting to € 21,704,914, and 336 outgoing declarations, totalling € 6,161,120. An increase in incoming declared amounts is also observed for 2024. The vast majority of the incoming declarations are attributable to the activities of public authorities and Vatican legal entities.
The Supervisory and Financial Information Authority (ASIF), formerly the Financial Information Authority (AIF), is the competent institution of Vatican City State for supervision and regulation to counter money laundering and terrorist financing and for financial intelligence. The Supervisory and Financial Information Authority (ASIF), the Vatican’s financial watchdog, received 79 suspicious activity reports in 2024
The Vatican has focused its business interests on service missions globally, but also on raising administration costs.