The service industries, which are dominated by public administration, contribute most of GDP. However, at least half the population still relies on agriculture and fishing. The majority of agriculture consists of cultivation and animal husbandry (pigs and poultry) for their own livelihood. Breeding of bananas, coconuts, jams, cassava and breadfruit occupies only a small part of the area. An important source of income is the leasing of fishing water to Japanese companies.
There is almost no industry, but construction and small crafts (sewing, carpet weaving, boat building) have some significance. Exports (consisting mainly of fish, handicraft products and bananas) cover only a small part of imports. The country also has a growing tourism industry.
Tourism and gastronomy
According to COUNTRYAAH, the country has great potential for tourism, but the poorly developed infrastructure is an obstacle. With financial support from the United States, efforts are being made to improve airports and ports, among other things. Many of the approximately 20,000 annual tourists visit war scenes from World War II and the ruin city of Nan Madol on Phnpei. Around the islands there are good opportunities for deep sea diving.
Note: the capital city of Micronesia is Palikir with a population of 7,900 (estimate 2013). Other major cities include Weno (Chuuk State) with a population of 12,900, Kitti (Pohnpei State) with a population of 7,900 (2013 estimate).
The basis of domestic cuisine consists of fish, seafood, coconuts, breadfruit, taro, bananas and cassava. The fish is usually served grilled. Mangrove crab with fried breadfruit is a specialty, but it can be difficult to get hold of. On the other hand, it is easy to find Japanese and Chinese restaurants, imported canned meats and other Western whole canned foods. Poultry is common and is often included in the Asian-inspired rice dishes. Coconut milk is the usual drink.
Economy and business
The basis for the economy is US economic aid, a growing fishing industry, growing tourism and agriculture as well as self-sufficiency fishing and a growing fishing industry. US aid has been gradually reduced since 1986. Public business is the main driver of the economy.
Fishing is the most important natural resource. Agriculture is run almost exclusively for self-sufficiency, covers 60 percent of the country’s needs and employs nearly half of its citizens; main products are bananas, copra, cassava, sweet potatoes and pepper. The industry is very little developed and mainly based on coconut products. At Kosrae there is a fish processing company. Craft production is small. Private sector growth is slow.
Large distances hamper business development in Micronesia, abbreviated as FM by abbreviationfinder.org.
Most of the imports (including finished goods, foods and medicines) are from the United States. Major exporting countries are the United States and Japan.