Federated States Of Micronesia Economy and Business

• GDP: US$232 million (2005).
• Main exports: Fish, garments, banana, kava and betel nut.
• Main imports: Food and manufactured goods.
• Main trade partners: Japan, USA, Hong Kong and Guam.

Subsistence farming and fishing are of declining importance as tourism has come to dominate the domestic economy and fishing is largely pursued by foreign commercial concerns operating under licence. Mineral resources are limited to a few high-grade phosphate deposits. Sales of these licences account for over one-third of national income.

Aid from the USA has been a vital source of income: under the Compact of Free Association with the USA, which was amended in 2004, the Federated States of Micronesia will continue to receive millions of dollars in annual aid until 2023. The compact also established a Trust Fund that will eventually provide the islands with annual payments in perpetuity. However, the decline in US help has depressed the economy. Growth was just 0.3% in 2005, while inflation was 2.2%. Unemployment was measured at about 22% in 2000.

The Federated States of Micronesia is a member of the South Pacific Commission and the South Pacific Forum. The main industries the FSM profit from are tourism, construction, specialised aquaculture, wood, pearls and craft items from shells.

Office hours: Mon-Fri 0800-1200 and 1300-1700.

The Pohnpei State Chamber of Commerce
PO Box 405, Pohnpei 96941, Kolonia, FSM
Tel: 320 2452.