The world's smallest country knows how to keep its books in order. The Vatican City posted a budget surplus of €2.4 million last year, it said.

With 2,704 religious and secular staff to pay, as well as the costs of diplomatic representations around the world, a TV and radio station, a daily newspaper and an internet site, the headquarters of the Catholic Church has annual outgoings of almost €228 million.

While it stayed in the black last year, the Vatican's surplus fell from the €9.7 million it reported for 2005.

Income for the Holy See - a separate country in the heart of Rome - comes from contributions from the faithful, stocks, bonds, other investments and real estate holdings.

The Vatican said Peter's Pence, the yearly collection taken in churches worldwide to help finance the Pope's international charitable works, totalled nearly $102 million last year, up from $60 million in 2005.