There is a small, but steady, tourist sector which generates some US$300,000 per year. The nation receives about 1,000 tourists per year. In addition to the 16-room hotel in Funafuti, there are about 12 guest houses on the islands. Because of the relative isolation of the islands, many indigenous Polynesian customs and traditions have survived. Tourists are exposed to dancing, singing, and variety of local crafts. There is also extensive diving, snorkeling, and fishing. Efforts to encourage tourism have resulted in government policies that give new tourist businesses tax-exempt status.
The subsistence nature of most of the population and strong cultural influences have combined to prevent the development of any significant retail trade. Instead local markets and home production of products is the norm. Each island has a cooperative store (Fusi) to sell local crops and products. All stores are closed on Sunday.