The Economy of the Marshall Islands is primarily based on tourism, fishing, and subsistence agriculture. The country’s GDP stands at around $117 million, with a per capita of $2,860. As a small island nation in the Pacific Ocean, the Marshall Islands is heavily reliant on foreign aid from countries such as the United States and Australia.
According to cheeroutdoor, tourism is one of the primary sources of income for the Marshall Islands. The country has a number of stunning white sand beaches and lagoons that attract visitors from around the world. The tourism industry contributes about 10% to the national GDP and provides employment for a large portion of its population.
Fishing is another major component of the economy in the Marshall Islands. Fishing provides an important source of food security for local communities as well as income through exports to countries like Japan and South Korea. Fish stocks have been declining over recent years due to overfishing and illegal fishing activities, however, efforts are being made to reduce these activities in order to protect fish stocks and ensure sustainability in fishing operations within the country’s waters.
Subsistence agriculture is also an important part of life in many areas within the Marshall Islands. Many households rely on farming small plots of land for their own consumption as well as selling excess produce at local markets or exporting it abroad. Other agricultural activities include raising livestock such as pigs, chickens, goats and cows which are used mainly for food consumption but can also be sold at markets or exported abroad for additional income generation.
The government has taken steps to diversify its economy away from its reliance on foreign aid by encouraging private sector investment into areas such as infrastructure development, renewable energy projects and telecommunications systems which could help create jobs while boosting economic growth in certain sectors like construction or technology related industries that have not yet been explored by investors due to lack of awareness or understanding about the potential opportunities available in this small island nation situated at a strategic location within Oceania region.
In conclusion, while economic activity remains relatively low compared to other countries around the world due to its lack of natural resources or access to foreign markets, there are still potential opportunities available that could be developed with careful planning by government leaders working together with private sector investors who are willing take risks while investing into sectors that could potentially create jobs while helping alleviate poverty levels within this beautiful island nation located in one of most isolated regions on earth – Pacific Ocean’s Micronesia region.
According to COUNTRYAAH, the Marshall Islands have a business sector where the public sector employs 48 percent of the workforce, while 38 percent work in the private sector (2017 figures from EPPSO, the National Statistical Agency). The remaining workforce is mainly employed by non-governmental or international organizations. The vast majority of wage work is found in the urban centers, primarily in Majuro, the capital, and at Kwajalein. The so-called outer atolls are dominated by natural housekeeping. According to the World Bank, gross domestic product (GDP) per capita was $ 4,860 in 2018.
The national currency is USD. In 2018, Nitijela, the country’s legislative power, voted to establish a cryptocurrency (called the Sovereign, SOV) that will operate in parallel with the USD.
An association agreement with the United States secures US financial assistance until 2023, with the possibility of renewal. Together with other forms of international development assistance, this constitutes an important part of GDP. In 2018, the Asian Development Bank (ADB) declared the Marshall Islands as a particular risk for debt.
In the 1990s, the Marshall Islands tried to develop financial services and attract capital by acting as a tax haven. Control of the banking system was tightened in 2002, after the OECD had accused the island state of allowing the so-called money laundering of criminal networks. The Marshall Islands still operate with a flag of convenience.
Note: the capital city of Marshall Islands is the atoll Majuro. Other major cities include Ebeye (on Kwajalein Atoll).
The military base at Kwajalein
In 1964, the US Army took over the administration of Kwajalein in connection with a military project to experiment with anti- ballistic missiles. The base has changed its name many times, but is now called the Ronald Reagan Ballistic Missile Defense Test Site (RTS).
Today, the ballistic missile trial and anti-ballistic missile intercept are conducted at RTS. The base is leased and operated by the United States Army Kwajalein Atoll (USAKA) with a contract that runs until 2066. Today, around 1,000 marshallers work at RTS. These commute from the Marshallese settlement on the island of Ebeye, 4 kilometers north of the base. It was here that the Kwajalein population was forcibly relocated when the base was first established in connection with the US nuclear test farther north on the Marshall Islands from the mid-1940s. Today, over 11,000 people live on Ebeye, which has made it one of the most densely populated islands in the world.
Agriculture and fishing
Agriculture, fisheries and manu- facturing employ about nine percent of the population and account for about 17 percent of GDP. Agriculture is limited by small and poor cultivation land. The most important agricultural product is coconuts, which both make important contributions to households and are one of the few export goods, often in the form of copra (dried coconut meat).
Otherwise, among other things, bread fruits, taro, bananas, papaya, tomatoes and pandanus are grown. There is some pig and poultry farming, but not commercial. In the waters, commercial fishing of tuna is conducted by foreign players, as well as small-scale fishing of lagoon fish to the local fish markets. The country has significant revenues from the sale of licenses to foreign fishing fleets.
The industry is poorly developed and is limited to the production of coconut products such as copra and coconut oil, as well as the construction industry and some production of fish canned goods. Otherwise, there is limited craftsmanship. These have little impact on the national economy, but are central to the household economy.
With the exception of the military camp at Kwajalein, the service industry is the most important in the private sector. Much of this is associated with the two major hotels in Majuro, as well as various retail businesses. Tourism is virtually non-existent, with less than 5,000 visitors a year, including around 50 percent of business travelers.
Abbreviated as MHL by abbreviationfinder.org, the Marshall Islands need to import most of what they need and have few export products. Scrap metal accounts for the largest share of exports. Of locally produced goods, various fishery products are the largest export goods (10 percent of total), followed by coconut products such as copra and coconut oil (0.55 percent of total).
Transport and Communications
International airports at Majuro and the US military base at Kwajalein serve international flights with Hawaii and other Pacific islands. The local airline Air Marshall Islands (AMI) connects Majuro to all inhabited atolls with varying frequency. United Airlines has flights to and from Hawaii, while Our Airlines (Air Nauru) flies to Australia via the Solomon Islands, Nauru and Kiribati.
The maritime transport between the islands is mainly operated by state-owned vessels. International container traffic is operated by several shipping companies, with Matson as the largest player. The Marshall Islands has an international shipping register and, through its flag of convenience, has switched between having the world’s second and third largest fleet over the past decade. By 2019, Panama and Liberia were bigger. Norwegian representative: The law firm Simonsen Vogt Wiig AS, Oslo.