Federated States of Micronesia: Trade Profile
For several years, the country’s trade policy objective has been to establish international economic relations for the development of foreign trade, especially with the support of the United States. In fact, trade is important to Micronesia’s economy, and the value of foreign trade equals 108% of GDP (World Bank, latest data available). Almost the entirety of exports is composed of fish and seafood products. The most recent imports of Micronesia are led by poultry meat, passenger and cargo ships, refined petroleum, special purpose motor vehicles, and cars (data OEC 2022).
The main export destinations of Micronesia are Thailand (78.1%), the Philippines (12.4%), Japan (4.5%), Ecuador (1.9%), and the United States (1%); while imports come chiefly from the United States (36.9%), China (20.8%), Japan (9.9%), South Korea (8.2%), and Taiwan (4.8% - data OEC 2022). In general, customs duties are relatively low, but overall trade freedom is limited by non-tariff barriers and poor trade infrastructure. All exports of products, as well as re-exports of imported products, are tax-free.
Micronesia imports more than it exports, resulting in a chronic trade deficit, a situation that should continue in the following years. In 2022, according to WTO data, the country exported USD 69 million of goods and imported USD 221 million, whereas no data is available for trade in services. In the same year, the World Bank estimated the country’s trade deficit at 44.1% of GDP, compared to 47.3% one year earlier.
| Foreign Trade Indicators | 2019 | 2020 | 2021 | 2022 | 2023 |
|---|---|---|---|---|---|
| Imports of Goods (million USD) | 194 | 213 | 254 | 277 | 301 |
| Exports of Goods (million USD) | 49 | 125 | 115 | 111 | 106 |
| Imports of Services (million USD) | 0 | 0 | 0 | 0 | 0 |
| Exports of Services (million USD) | 0 | 0 | 0 | 0 | n/a |
| Foreign Trade (in % of GDP) | 96 | 86 | 88 | 85 | 95 |
| Imports of Goods and Services (in % of GDP) | 69 | 68 | 68 | 64 | 68 |
| Exports of Goods and Services (in % of GDP) | 27 | 17 | 20 | 21 | 27 |
Source: WTO – World Trade Organisation ; World Bank - Latest available data.
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Signatory to 'South Pacific Regional Trade Economic Cooperation Agreement (SPARTECA)'
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Latest Update: May 2024
