Micronesian Social and Economic Indicators

As part of our ongoing effort to keep Habele volunteers and donors informed about cultural and political developments in Micronesia’s remote Outer Islands we have compiled this brief overview of national indicators. It is important to keep in mind that these figures reflect either federal averages or the data gathered in district centers, and that the situation in the Outer Islands tends to be significantly less developed.

The Asian Development Bank’s four-page 2007 Fact Sheet on Micronesia is a great place to start. The Bank notes The FSM economy is dominated by a public sector funded by sector grants under the Compact II assistance arrangement with the United States (US). Despite significant levels of development assistance, the FSM economy averaged annual growth of only 1.8% during Compact I (1987–2003). It contracted 0.7% in 2006.

The 2007 Infant Mortality Rate for Micronesia is reported at 42 per 1000 (close to the Pacific/ East Asia average, but compared to just 8 per 1000 in the United States) and the Per Capita Gross National Income is US $2,300 - about 1/20th of that in the US.

The International Monetary Fund’s Selected Issues and Statistical Appendix for the Federated States of Micronesia is forty-five page compilation of facts and figures. The IMF explains that since 2001, private sector growth has stagnated. During 2001–05, private sector GDP grew by 0.9 percent on average, compared with 2.2 percent for the public sector. As a result, the private sector’s share in GDP fell to 29 percent in 2005, compared to 40 percent for the public sector. During this period, employment in manufacturing, construction, and tourism fell sharply, while in services, mainly retail, it expanded.

The Fund is also cautious about the future, and fears that this stagnation will worsen in coming years. Analysis shows that the barriers to conducting business make Micronesia an unlikely candidate for growth. There is evidence within the region suggesting a link between the business climate and private sector growth. A simple plot of average growth rates during 2000–06 and the World Bank’s Doing Business in 2007: How to Reform rankings show that Pacific Island Countries (PICs) with lower costs of doing business featured faster average growth rates. With Micronesia ranking near the bottom among PICs in both the business environment and growth performance, improving the regulatory regime could yield significant economic benefits. Overall, Micronesia ranked 106th among the 175 participating counties and at the bottom among Pacific Island Countries in the ease of doing business.

The Secretariat of the Pacific Community’s Statistics Unit is another great resource. The Secretariat reports that only 23.5 percent of the Micronesian population has access to “improved sanitation,” though 92.8 percent enjoy access to improved drinking water.”

Also worth a look is the United Nations Population Fund’s Indicators, and the World Bank’s guide to doing business in Micronesia.

The Habele Outer Island Education Fund is a US-based nonprofit dedicated to promoting educational opportunity and accomplishment in the remote islands and atolls of Micronesia’s Outer Islands. Through scholarships to private schools and material support to public schools we work to provide a firm basis for personal, island, and national growth in Micronesia.