IMF Staff Country Reports

As a small, fragile, and remote island state, the Republic of the Marshall
Islands faces several vulnerabilities and challenges, including high exposure to climate-related
shocks and persistent labor emigration. Near-term growth is projected to
accelerate amid expansionary fiscal policy. Growth is expected to moderate over the
medium term, constrained by structural challenges and inflation to remain above its
historical average. The government is pursuing an ambitious reform agenda. The recent
renewal of the Compact of Free Association (Compact) with the United States offers a
window of opportunity to enhance fiscal prudence and press ahead with such reforms.