ting, except for high-grade phosphate. The potential for a tourist
industry exists, but the remote location and a lack of adequate facilities
hinder development. In 1996, the country experienced a 20% reduction in
revenues from the Compact of Free Association - the agreement with the
US in which Micronesia received $1.3 billion in financial and technical
assistance over a 15-year period until 2001. Since these revenues
accounted for 57% of consolidated government revenues, reduced Compact
funding resulted in a severe depression. Economic activity recovered in
1999-2001. The country's medium-term economic outlook appears fragile due
to likely further reductions in external grants made under the US Compact
funding. Geographical isolation and a poorly developed infrastructure
remain major impediments to long-term growth.

GDP: purchasing power parity - $269 million (2001 est.) note: GDP is
supplemented by grant aid, averaging perhaps $100 million annually

GDP - real growth rate: 2% (2001 est.)

GDP - per capita: purchasing power parity - $2,000 (2001 est.)

GDP - composition by sector: agriculture: 50% industry: 4% services: 46%
(2000 est.)

Population below poverty line: NA%

Household income or consumption by percentage share: lowest 10%: NA%
highest 10%: NA%

Inflation rate (consumer prices): 2.5% (2001 est.)

Labor force: NA

Labor force - by occupation: two-thirds are government employees

Unemployment rate: 16% (1999 est.)

Budget: revenues: $161 million ($69 million less grants) expenditures:
$160 million, including capital expenditures of $NA (1998 est.)

Industries: tourism, construction, fish processing, craft items from
shell, wood, and pearls

Industrial production growth rate: NA%

Electricity - production: NA kWh

Electricity - production by source: fossil fuel: NA% nuclear: NA% other:
NA% hydro: NA%

Electricity - consumption: NA kWh

Agriculture - products: black pepper, tropical fruits and vegetables,
coconuts, cassava (tapioca), sweet potatoes; pigs, chickens

Exports: $22 million (f.o.b., FY99/00 est.)

Exports - commodities: fish, garments, bananas, black pepper

Exports - partners: Japan, US, Guam

Imports: $149 million (f.o.b., FY99/00 est.)

Imports - commodities: food, manufactured goods, machinery and equipment,
beverages

Imports - partners: US, Australia, Japan

Debt - external: $66.5 million (FY99/00 est.)

Economic aid - recipient: unde