Federated States of Micronesia: Economy#
Economic activity consists largely of subsistence farming and fishing, and government, which employs two-thirds of the adult working population and receives funding largely - 58% in 2013 – from Compact of Free Association assistance provided by the US. The islands have few commercially valuable mineral deposits. The potential for tourism is limited by isolation, lack of adequate facilities, and limited internal air and water transportation.Under the terms of the original Compact, the US provided $1.3 billion in grants and aid from 1986 to 2001. The US and the Federated States of Micronesia (FSM) negotiated a second (amended) Compact agreement in 2002-03 that took effect in 2004. The amended Compact runs for a 20-year period to 2023; during which the US will provide roughly $2.1 billion to the FSM. The amended Compact also develops a Trust Fund for the FSM that will provide a comparable income stream beyond 2024 when Compact grants end.
The country's medium-term economic outlook appears fragile because of dependence on US assistance and lackluster performance of its small and stagnant private sector.
Economic Facts#
| GDP (purchasing power parity) | $314 million (2016 est.) $310.7 million (2015 est.) $311.2 million (2014 est.) note: data are in 2016 dollars |
|---|---|
| GDP (official exchange rate) | $325 million (2015 est.) |
| GDP - real growth rate | 1.1% (2016 est.) -0.2% (2015 est.) -3.4% (2014 est.) |
| GDP - per capita (PPP) | $3,000 (2016 est.) $3,000 (2015 est.) $3,000 (2014 est.) note: data are in 2016 dollars |
| GDP - composition, by end use | household consumption: 83.5% government consumption: 41.8% investment in fixed assets: 24.3% investment in inventories: 0% exports of goods and services: 26.6% imports of goods and services: -76.2% (2013 est.) |
| GDP - composition, by sector of origin | agriculture: 26.3% industry: 18.9% services: 54.8% (2013 est.) |
| Agriculture - products | taro, yams, coconuts, bananas, cassava (manioc, tapioca), sakau (kava), Kosraen citrus, betel nuts, black pepper, fish, pigs, chickens |
| Industries | tourism, construction; specialized aquaculture, craft items (shell and wood) |
| Industrial production growth rate | NA% |
| Labor force | 37,920 (2010 est.) |
| Labor force - by occupation | agriculture: 0.9% industry: 5.2% services: 93.9% note: two-thirds of the labor force are government employees (2013 est.) |
| Unemployment rate | 16.2% (2010 est.) |
| Population below poverty line | 26.7% (2000 est.) |
| Household income or consumption by percentage share | lowest 10%: NA% highest 10%: NA% |
| Distribution of family income - Gini index | 61.1 (2013 est.) |
| Budget | revenues: $213.8 million expenditures: $192.1 million (FY12/13 est.) |
| Taxes and other revenues | 65.8% of GDP (FY12/13 est.) |
| Budget surplus (+) or deficit (-) | 6.7% of GDP (FY12/13 est.) |
| Public debt | 28% of GDP (2013) 27% of GDP (2012) |
| Fiscal year | 1 October - 30 September |
| Inflation rate (consumer prices) | 1.9% (2016 est.) -1% (2015 est.) |
| Commercial bank prime lending rate | 7.1% (2013 est.) 6.4% (2012 est.) |
| Stock of narrow money | $196 million (31 December 2013 est.) |
| Stock of broad money | $225.2 million (31 December 2013 est.) |
| Stock of domestic credit | $56.98 million (2013 est.) $56.77 million (31 December 2011 est.) |
| Current account balance | $3 million (2015 est.) $3 million (2015 est.) |
| Exports | $88.3 million (2013 est.) $95.7 million (2012 est.) |
| Exports - commodities | fish, sakau (kava), betel nuts, black pepper |
| Imports | $258.5 million (2013 est.) $263.4 million (2012 est.) |
| Imports - commodities | food, beverages, clothing, computers, household electronics, appliances, manufactured goods, automobiles, machinery and equipment, furniture, tools |
| Reserves of foreign exchange and gold | $75.06 million (31 December 2011 est.) |
| Debt - external | $93.6 million (2013 est.) $93.5 million (2012 est.) |
| Stock of direct foreign investment - at home | $15.8 million (2013 est.) $34.4 million (2012 est.) |
| Exchange rates | the US dollar is used |