Economy overview: The economic activity of the islanders consists primarily in subsistence agriculture and fishing. The islands have minor mineral deposits, with the exception of high-quality phosphate deposits. There is potential for the tourism industry, but the remote location and lack of adequate infrastructure hinder its development. In 1996, revenues from the free association agreement with the United States decreased by 20% (under the agreement, Micronesia received $1.3 billion in financial and technical assistance over the fifteen years until 2001) when moving to the second stage of this agreement. Since these revenues account for 57% of all government revenues, the reduction in funding was the cause of a deep recession. After the Micronesian economy apparently bottomed out in 1999, the country’s medium-term economic outlook remains unclear, as US aid is likely to decline further. Geographical isolation and underdeveloped infrastructure are the main obstacles to the development of the economy in the long term.
GDP: Purchasing Power Parity $263 million (1999 est.); note: GDP is supplemented by subsidies averaging $100 million annually.
Real GDP growth rate: 0.3% (1999 est.).
GDP per capita: Purchasing power parity – $2,000 (1999 est.).
The composition of GDP by sectors of the economy: agriculture: 19%; industry: 4%; services: 77% (1996 est.).
Proportion of the population below the poverty line: no data available.
Percentage distribution of household income or consumption: for the poorest 10% of households: n/a; by top 10% of households: no data.
Consumer price inflation rate: 2.6% (FY98-99 est.).
Labor force: no data.
Employment structure: two-thirds are in the civil service.
Unemployment rate: 16% (1999 est.).
Budget: revenues: $161 million (including $69 million in subsidies); expenditures: $160 million, including capital investment – NA (1998 est.).
Economic sectors: tourism, construction, fish processing, making souvenirs from shells, wood and pearls.
Growth in industrial production: no data available.
Electricity production: no data.
Sources of electricity generation: fossil fuels: no data available; hydropower: no data; nuclear fuel: no data; others: no data.
Electricity consumption: no data.
Export of electricity: no data.
Electricity import: no data.
Agricultural products: black pepper, tropical fruits and vegetables, coconuts, cassava (tapioca), sweet potatoes; pigs, chickens.
Exports: $73 million (free on board, 1996 est.)
Exports: fish, clothes, bananas, black pepper.
Export partners: Japan, USA, Guam.
Imports: $168 million (S.I.F., 1996 est.)
Import articles: foodstuffs, semi-finished products, machinery and equipment, drinks.
Import partners: USA, Japan, Australia.
External debt: $111 million (1997 est.). Economic Assistance Recipient: Under the Compact of Free Association, the US committed to provide $1.3 billion in subsidies during 1986-2001.
Economic aid donor:
Currency: US dollar.
Currency code: USD.
Exchange rate: US dollar is used.
Fiscal year: October 1-September 30.
Telecommunications Telephone lines: 11,000 (2001).
Mobile cellular phones: no data available.
Telephone system: satisfactory; internal: the islands are interconnected by short-wave telephone communication (used mainly for government needs); international: 4 ground satellite stations Intelsat (Pacific Ocean). See militarynous.com to know more about Micronesia Military.
Broadcast stations: AM – 5, FM – 1, shortwave – 0 (1998).
Radio receivers: no data.
Television broadcast stations: 2 (1997).
TVs: no data.
Internet country code: fm
Internet providers: 1 (2000).
Number of users: 2,000 (2000).