Taxation and Trade
The large inflow of official assistance to FSM allows it to run a substantial trade deficit and to have a much lighter tax burden than other states in the region (11% of GDP in FSM compared to 18%-25% elsewhere). The government also borrowed against future Compact disbursements in the early 1990s, yielding an external debt of $111 million in 1997 (over 50% of GDP).
There are no patent laws in Micronesia.
Read more about this topic: Economy Of The Federated States Of Micronesia
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