Economic indicators suggest that gross domestic product (GDP) growth this year in the Republic of the Marshall Islands (RMI) remains on track to meet the Asian Development Outlook (ADO) 2014 projections in April. As North Pacific economies, including RMI, are small and dominated by the public sector, economic performance generally tracks public capital expenditure.
|Selected economic indicators (%) - Marshall Islands||2014||2015|
|ADO 2014||Update||ADO 2014||Update|
|Current Account Balance (share of GDP)||-20.6||-20.6||-10.9||-10.9|
Source: ADB estimates.
In Fiscal Year 2014 (ends 30 September 2014), RMI’s economy is expected to grow by 3.0% as previously delayed infrastructure projects are implemented with funding from development partners. The growth rate is expected to fall by half in FY2015 as construction projects wind down.
Relatively low and stable inflation is expected in RMI in line with ADO 2014 forecasts, and expectations that international commodity prices will remain soft.
Imports by RMI from the United States were slightly lower, down by 0.3% year on year, in the first 9 months of FY2014. This was despite a massive import bill in June - over 78% of which was tied to the importation of two ships for interisland transport. Before June, lower fuel imports drove declines in import costs.
The current account balance forecast for RMI remains unchanged from ADO 2014. The surge in the current account deficit from 9.0% of GDP in FY2013 reflects the importation of the two ships.
Source: ADB. 2014. Asian Development Outlook 2014 Update. Manila.