Tuvalu has been experiencing internal migration and Funafuti, the capital island of Tuvalu, has a population density of 1,610 persons per square kilometre while the outer islands are at an average of 220 persons per square kilometre. The urban population is about 50% (UN Data n.d.) of the total. About 30% of Tuvalu’s population is aged under 15 years old (UIS n.d.) while the youth population aged 15 - 24 is about 16% (UNESCO 2008). Approximately 5% of the population is aged 65 and above (Central Intelligence Agency n.d.). The gender ratio is 98.2 men per 100 women and life expectancy is slightly higher for women than for men  (UN Data n.d.). Tuvalu is largely ethnically homogeneous with 96% of the population being Polynesian and 4% Micronesian (Central Intelligence Agency n.d.).

Tuvalu has no known mineral resources and few export products and the country is almost entirely dependent on imported food and fuel (Central Intelligence Agency n.d.). Its main form of income consists of foreign aid and the government revenues largely come from the sale of stamps and coins, fishing licenses and worker remittances (UNDP n.d.).  In 2010, GDP per capita was $3,400 (Central Intelligence Agency n.d.) and between 2006 and 2010 the country experienced dramatic decline in economic growth from 6.6% to 0.2% per annum (World Bank n.d.). This decline can in parts be attributed to difficult financial conditions for the Tuvalu Cooperative Society (the main wholesaler and retailer in Tuvalu), and the global financial crisis, effects of the latter being strongly felt despite Tuvalu’s geographic remoteness and increased government spending (IMF 2011). 

Job opportunities are scarce in Tuvalu and public sector workers make up most of those employed while subsistence farming and fishing remain the primary economic activities, particularly on the capital island of Funafuti (UNDP n.d.). Remittances from seamen working on overseas vessels are a significant source of income for many families (Australian Department of Foreign Affairs and Trade n.d.) and the 2002 census showed that 44.2% and 34.2% of all Tuvalu households received remittances from abroad in 1991 and 2002 respectively (UNESCO 2008). 

In 1978 Tuvalu gained independence from United Kingdom and today it is a constitutional monarchy with a 15-member unicameral parliament elected every four years. HM Queen Elizabeth II is the Head of State and is represented in the country by the Governor General, with the Prime Minister as the Head of Government. The Cabinet consists of the Prime Minister, elected by a majority of the members of parliament, and several ministers. There are no organised political parties and members usually align themselves in informal groupings. MPs have very close links with their island constituencies and effort is directed towards balancing island representation in Cabinet (Australian Department of Foreign Affairs and Trade n.d.). 

Each of Tuvalu's eight inhabited islands is based around a single village and has a distinct sense of community and identity. Traditional councils of chiefs operate together with the established government and are the supreme authorities on matters of custom. Under the Falekaupule Act (1997), increasing autonomy has been given to the island councils to determine development priorities within the central government's overall development goals of public sector reform, human resource development, improvement of the country's economic and education infrastructure (Australian Department of Foreign Affairs and Trade n.d.).

Similar to most other atolls in the region, Tuvalu has a number of key development constraints including: limited natural resource base, widely scattered and sparsely populated island geography, small domestic market with little potential for economies of scale, expensive access to major international markets and low absorptive capacity for major investments amongst others (UNESCO 2008). Tuvalu is also facing environmental issues such as beachhead erosion because of the use of sand for building materials, excessive clearance of forest undergrowth for use as fuel and damage to coral reefs from the spread of the Crown of Thorns starfish. Moreover, Tuvalu is concerned about global increases in greenhouse gas emissions and their effect on rising sea levels, which threaten the country's underground water table (Central Intelligence Agency n.d.).