Trade Profile

flag Palau Palau: Trade Profile

Foreign Trade in Figures

Palau is open to foreign trade with merchandise trade representing 66% of the GDP in 2020 (World Bank, 2022). One of the characteristics of Palauan economy is the high dependency on imports of good and services. The main imported goods are led by Refined Petroleum (13.3% of all imports), boat propellers (4.25%), Iron structures (4.03%) and cars (3.1%). The country mainly exports computers (37.1% of all exports in 2021), scrapped vessels (15.1%), Recreational Boats (11.7%) and Scrap Iron with 9.32% (OEC, 2023).

Palau's main clients are Japan (34.2% of total exports in 2021), Chinese Taipei (15.8%), Turkey (15.5%) and Italy (11.7%), while the main suppliers are China (33.7%), the USA (21%), South Korea (12%) and Japan with 8.3% (OEC, 2023). Palau is a member of the Pacific Island Countries Trade Agreement (PICTA).

Without natural resources, the archipelago has a large structural trade deficit, which is expected to persist in the coming years. According to 2023 WTO data, Palau exported just 2 million USD in goods and imported 156 million USD of goods in 2021, resulting in a negative trade balance for goods of 132 million USD taken services into account. The country wishes to facilitate international trade. Customs duties are relatively low (with the exception of alcohol and cigarettes) and there are few non-tariff trade barriers in the country. However, the lack of skilled labour force, the absence of financial regulations and bureaucratic delays are limitations to the development of trade in the country.

 
Foreign Trade Indicators 20182019202020212022
Imports of Goods (million USD) 176193149156210
Exports of Goods (million USD) 44723
Imports of Services (million USD) 6363554848
Exports of Services (million USD) 11198491018
Trade Balance (million USD) -138-141-150-127-156

Source: WTO – World Trade Organisation ; World Bank - Latest available data.

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Commercial Policy

Assessment of Commercial Policy
Palau and WTO
Average Customs Duty (Excluding Agricultural Products)
3%
 
 

Trade Compliance

Useful Resources
Bureau of Revenue, Customs and Tax
 
 
 

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Latest Update: November 2023