Marshall Islands: Trade Profile

 The Marshall Islands is very open to foreign trade, which accounts for 116% of its GDP (World Bank, latest data available). Custom duties are relatively low, and the country has very few trade barriers. However, the Marshall Islands has very limited natural resources and consequently little base for exports. In 2022, the country mainly exported (including re-exports) passenger and cargo ships (USD 642 million), special-purpose ships (USD 156 million), refined petroleum (USD 95.3 million), recreational boats (USD 91.1 million), and non-fillet frozen fish (USD 55.6 million), whereas imports were led by passenger and cargo ships (USD 6.8 billion), refined petroleum (USD 2.76 billion), recreational boats (USD 207 million), additive manufacturing machines (USD 181 million), and centrifuges (USD 97.9 million – data OEC).

According to the latest data by OEC, in 2022, the main destinations for the country’s exports were Germany (29.8%), Denmark (14.6%), United Kingdom (14.5%), Malta (6%), and Indonesia (5.3%); while the main countries for imports were China (32.6%), South Korea (30.6%), Japan (11.6%), Taipei (4.1%), and Brazil (4%). Overall, the country lacks adequate infrastructure and airline transportation and is fairly far from the developed economies of the region (e.g., Japan, Australia, etc.). Trade policy is conducted by the COFA Agreement under which the country has duty-free access to the U.S. market and is also a member of the Pacific Island Countries Trade Agreement (PICTA) and the South Pacific Regional Trade and Economic Cooperation Agreement (SPARTECA).

The country imports in high volumes, while its exports are very weak, resulting in an enormous trade deficit. According to figures from OEC, in 2022, the Marshall Islands exported USD 1.1 billion worth of goods (down by 21.4% year-on-year), whereas imports were stable (to USD 10.6 billion). Data from the World Bank show that the country's external trade deficit stood at 23.1% of GDP in 2022, down from 37.4% one year earlier.

0.0 bn USD of services exported in 2021
Government servicesGovernment services	92.54%
TransportationTransportation	6.44%
Computer and information servicesComputer and information services	1.02%

0.1 bn USD of services imported in 2021
TransportationTransportation	42.40%
Other business servicesOther business services	34.03%
TravelTravel +	13.68%
Personal travelPersonal travel	13.39%
Business travelBusiness travel	0.29%
Government servicesGovernment services	9.63%
Insurance servicesInsurance services	0.26%

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