Pacific Finance Sector Briefs: Marshall Islands

Abstract

The Marshall Islands is a relatively small and remote economy. The service sector is the largest contributor to the country’s economy, with output driven by government expenditure, and assistance from the United States (US). The latter comes mostly in the form of annual grants under the Compact of Free Association (the Compact) between the two countries. Agriculture (including fisheries) is the second-largest sector, and its contribution to the economy has risen sharply in recent years, due to higher fisheries license revenues. Industrial output accounts for the smallest share in the economy, with construction and utilities making the greatest contributions to this sector.