III.

Economy

The chief economic activities are subsistence agriculture, fishing, and tourism, and some high-grade phosphate is mined. The major export is copra (the oil-rich dried kernels of coconuts). The islands have few natural resources and so imports far exceed exports. In 2004 the gross national product was about US$142 million (World Bank estimate), giving an average income per head of US$2,980. The monetary unit of the Marshall Islands is the US dollar. The tourist industry is the primary source of foreign exchange and employs about 10 per cent of the workforce. The Marshall Islands receive financial assistance from the United States in accordance with the Compact of Free Association (see History section below); in 1995-1996 the US aid package amounted to US$52.8 million (82 per cent of which was provided). Australia and Japan also provide aid. About 42 per cent of the government’s 1994-1995 budget had to go towards debt repayment.