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With just 180 square miles of land and a population of 20,000 people, the Republic of Palau is strategically located in the Western Pacific Ocean. Without support, China could take over.
Palau, the Republic of the Marshall Islands, and the Federated States of Micronesia (collectively known as the Freely Associated States (FAS)) are located at a key crossroads in the Pacific Ocean, cover tens of thousands of square miles of shipping lanes, and are coveted by China. Countless small islands.
Thanks to delays in funding aid, the United States is at risk of losing exclusive military access to the FAS, a Pacific region larger than the mainland United States. The implications for U.S. power and military options in the vast western seas would be significant and would represent a loss of influence and territory that would put China at the doorstep.
The FAS countries became US-administered trust territories after World War II, and then became independent states in the late 1970s. However, both countries have maintained close ties with the United States and enjoyed U.S. financial support through a diplomatic agreement known as the Compact of Free Association (COFA).
The first COFA agreement was signed in the mid-1980s. Renewal of the agreement was initiated in 2010 and restarted during the Trump administration, but was delayed by the pandemic.
The COFA agreement was scheduled to expire this year and in 2025, but was officially renewed in May 2023 for an additional 20 years. But the $7.1 billion in funding to support them, which was supposed to be approved by Congress by October 1, 2023, has not been approved.
The $95 billion foreign military aid bill passed by the Senate on February 13 originally included $2.3 billion in funding for three Pacific island nations, but a provision was changed at the last minute for unknown reasons. Deleted.
In a joint letter sent to several U.S. senators earlier this month, the leaders of the Marshall Islands, Federated States of Micronesia and Palau said the funding delays “created anxiety among their citizens” and “unwanted opportunities for economic exploitation.” It is bringing about this,” he said. by competitive political actors operating in the Pacific region. ”
I spoke with Palau President Slangel S. Whipps Jr. yesterday via online conference. “I have full faith and confidence that the United States Congress will understand this.” [funding legislation] It’s over,” he told me. “How long? That’s the challenge.”
Whipps said he has explained to the people and government of Palau (which was modeled after the U.S. system) that the U.S. is not backing down on any of the provisions of COFA. However, this has not always been the case in a timely manner.
He points out that the agreement signed in 2010 was made under a continuing resolution of Congress, which again relied on appropriations in 2024.
“For eight years, [COFA] “The agreement was not fully implemented,” Whipps recalled. “It went into effect in 2018 when President Trump took office.”
President Whipps visited Washington, DC in September 2023 and emphasized the importance of COFA to members of Congress. He says the compact gives Palauans confidence. But Palauans are already experiencing Chinese influence, he added.
In 2013, the island nation’s tourism-dependent economy saw fewer than 10,000 tourists of all nationalities visit the small islands. By 2016, the number of Chinese tourists had swelled to nearly 100,000, accounting for 70% of the country’s tourism business and overwhelming other tourists.
“Our GDP has skyrocketed by 30 percent during this period,” Whipps said. Palau’s fishermen are suddenly making millions of dollars for the fish and crabs they catch. “They are [China] “If you form an alliance with us, there are no limits,” he declared. That was the message they sent us. ”
After Whipps was elected president in 2016 and Palau decided to maintain diplomatic relations with Taiwan, Chinese tourism plummeted. Tourism has since come to a complete halt due to the coronavirus, but Chinese tourists have returned, raising concerns that they will monopolize the market.
With the rapid increase in the number of Chinese tourists, Chinese people have started investing in real estate in Palau, but development is eerily lacking. “They’re not growing, they’re just maintaining,” Whipps asserts. Development or no development, the lure of Chinese money has some islanders, including Palau officials, unsettled.
In late 2023, the Department of Defense announced a $118 million contract to build tactical mobile over-the-horizon radars on the north and south islands of the Palau archipelago. The radar, expected to be completed by 2026, could provide important early warnings. Beyond-line-of-sight capabilities not only provide extensive situational awareness in the Western Pacific, but also provide cues to space and ground sensors that track hypersonic weapons, cruise missiles, ballistic missiles, enemy aircraft, and ships. .
The strategic and tactical importance of the radar inspired one of Palau’s senators to propose that the United States deploy Patriot missile batteries on Palau to protect the island’s population and the sensors themselves. President Whipps brought the idea to the Pentagon last September and provided public comment on the discussion.
“Right after that, in November,” Whipps said. [Palauan] Senators passed a resolution saying they did not want missiles. We want to be a peaceful place and we don’t want to worsen the world situation. [international] situation. “
The resolution plays into China’s insistence on “military non-escalation” in the Pacific region, Whipps said. This followed a visit by China-based investors to Palau in October after COFA funding was delayed. “As you can see, [Chinese] He added that Palau had traced a number of investor groups back to Chinese state-owned enterprises.
The military value of the FAS state is already high, despite the fact that the United States actually has few troops or facilities within the state. For example, consider that Palau is approximately 1,300 miles southwest of Guam and approximately 1,000 miles southeast of Manila.
The United States has major military facilities on Guam, including Andersen Air Force Base, which can accommodate B-52, B-1, and B-2 bombers. It is also home to his first new Marine Corps base in 70 years, opening in early 2023, and new defensive missile systems and sensors. The Philippines is a key ally and last April granted US forces access to four new sites in its territory.
In late January, the Center for Strategic and International Studies (CSIS) released a report on the importance of COFA and FAS, highlighting their value.
… Consider a scenario in which China replaces the United States in the FAS, thereby establishing a Line of Control between Hawaii and Southeast Asia. Such an outcome would not only require a massive U.S. military buildup (perhaps in the hundreds of billions of dollars) to maintain strategic balance, but would also require China to protect U.S. and allied forces in contingencies on Taiwan or in the South China Sea. It will be placed directly behind the Additionally, this scenario would isolate Australia and New Zealand from the US…
CSIS Senior Scientist and Australian Chair Kathryn Pike is a co-author of the report. In her phone interview, she said that in addition to the strategic value of real estate, countries like Palau have a long history of war, including World War II and the battles the U.S. fought against Japan, such as the Battle of Peleliu and the Battle of Peleliu. He said there are strong historical and cultural ties dating back to important battles. Anguar, where thousands of Americans and many Palauans lost their lives.
“Relationships with FAS and other island states [the Solomons, Samoa and more] has given us a foothold and presence beyond the Pacific…For many years we have taken that presence and those relationships for granted, but as global competition intensifies… We need to be aware that China is considering opportunistic ways to expand everywhere, and as we move forward we may not be able to live up to what is expected of us. ”
She pointed to the sea, land and early warning access that FAS countries provide to the United States pursuant to COFA. “We have a small Army installation in Kwajalein. [in the Marshall Islands] This is the place where missile tests are conducted. We have the ability to infiltrate and manipulate radar. Perhaps more importantly, we have the opportunity to deny third countries like China the ability to establish a military foothold in these countries. ”
Pike added that the FAS countries’ exclusive economic zones extend almost from the Philippines to Hawaii. If China were to establish a military foothold there, it would effectively cut off the United States from its bases in Australia, the Philippines and Guam, and would “significantly complicate” any contingencies in Taiwan or the South China Sea.
Returning to Palau’s capital Ngerulmud (located on the country’s largest island, Babeldaob Island), President Whipps noted that as evidence of Palau’s complex nature, thousands of Palauans live on the mainland United States, and about 500 Palauans live on the U.S. mainland. pointed out the fact that he serves in the U.S. military. Ryogoku.
But China is trying to get in among us. Whipps noted that the recent recognition of China and rejection of Taiwan by the small Republic of Nauru (southeast of Palau) represents the kind of success China can achieve. He added: “Since I took office, four Chinese vessels, which they call ‘research vessels,’ have entered our waters without permission and conducted investigations.”
So far, FAS has not received a direct response to the formal letter it sent to the U.S. Senate, Whipps said. But he noted that Rep. Michael McCaul (R-Texas), chairman of the House Foreign Affairs Committee, recently said the House needs to move forward with defunding COFA. “We’re seeing that activity and it’s encouraging,” Whipps said.
Palau’s longest runway is 7,200 feet, which is not long enough to accommodate heavily laden military transports, bombers, and passenger planes. The country has three different airstrips on three islands, and Whipps is in talks with the Pentagon about the prospect of extending the runways.
This could benefit U.S. military operations and Palau’s economy, giving it the opportunity to welcome wide-body aircraft, more direct flights from overseas, and the accompanying tourists. Whipps suggested Palau could become the FedEx FDX hub for the Western Pacific. Because Palau’s economy is too reliant on U.S. funds, delays have led to a shortage of police officers and teachers, and the stronger Palau’s economy, the stronger the U.S. security in the Indo-Pacific, he said. claim.
“We are protected by America,” Whipps said. “Why not invest here? We are 3 hours from Hong Kong and 5 hours from Tokyo, in the same time zone. It’s an opportunity.”
Mr. Whipps has a point, and his commitment to a rules-based international order in the Pacific is commendable. He is eyeing the possibility of attaching COFA funds to future government spending bills, which must be passed by March 1 and March 8.
“It’s important that Washington doesn’t forget about the Pacific, which we sometimes feel like here,” Whipps told me. “We are small islands scattered in an ocean. Challenges in Ukraine and Israel can be difficult. [the U.S.] We’re focused on, but the truth is, it’s really important at this point to stay the course and show strength in the Indo-Pacific region. ”
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