Federated States of Micronesia: Investing

FDI in Figures

The foreign investments into the country have been increasing, although at a very slow rhythm. Nevertheless, the slowdown of the global economy has posed a limit their strenght.

The tourism sector offers good business potential. The usage of the US dollar as the national currency protects the investors against unexpected currency fluctuations. Moreover, corporate taxes in Micronesia are low. However, geographical isolation, as well as inadequate airline connections and infrastructures are an impediment to the FDI influx.

The fishing sector (which includes license fees for the right to extract halieutic resources from the territorial waters of the country) attracts most of the investors. The main investing countries are the United States and Japan.

	Federated States of Micronesia	East Asia & Pacific	الولايات المتحدة	Germany
Index of Investor Protection	2.7	5.3	8.3	5.0

Source: Doing Business

Note: The Greater the Index, the Higher the Level of Investor Protection.

Foreign Direct Investment	2008	2009	2010
FDI Inward Flow (million USD)	6	8	10
FDI Inwards (in % of GFCF****)	6.8	30.0	-

Source: UNCTAD - Last Available Data

Note: * The UNCTAD Inward FDI Performance Index is Based on a Ratio of the Country's Share in Global FDI Inflows and its Share in Global GDP. ** The UNCTAD Inward FDI Potential Index is Based on 12 Economic and Structural Variables Such as GDP, Foreign Trade, FDI, Infrastructures, Energy Use, R&D, Education, Country Risk. *** Green Field Investments Are a Form of Foreign Direct Investment Where a Parent Company Starts a New Venture in a Foreign Country By Constructing New Operational Facilities From the Ground Up. **** Gross Fixed Capital Formation (GFCF) Measures the Value of Additions to Fixed Assets Purchased By Business, Government and Households Less Disposals of Fixed Assets Sold Off or Scrapped.

Tax Rates

Sales tax: 6%
Bilateral Agreement: The Federated States of Micronesia and Egypt are not bound by a Double Taxation Agreement.
Social Security Contributions Paid By Employers: 6%

Investment Opportunities

Tenders, Projects and Public Procurement: Asian Developement Bank, Proposed Projects in Asia
DgMarket, Tenders Worldwide
Setting Up a Company: Consult Doing Business Website, to know about procedures to start a Business in Federated States of Micronesia.
Useful Resources: Investment Guide of Micronesia

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