“Both are countries that recognise Taiwan and are key components of US defence architecture in the Pacific,” she said. “Watch for increased (Chinese) political warfare spin around the US being an unreliable partner.”
Paskal said Palau’s funding under its existing COFA had dwindled as it approached its final year and it had been banking on funds from the new package to help cover budget deficits.
Paskal said Palau’s economy had already taken bad hits from COVID-19 and Chinese economic interference aimed at pressuring it to switch diplomatic recognition from US-backed Taiwan to Beijing.
There is no new money so far too for the Marshall Islands, which has yet to finalise new terms with Washington due to disagreements over how to address the legacy of massive US nuclear testing there in the 1940s and 1950s.
Meanwhile, China is waiting in the wings with ready cash.
Roll Call, a news site covering the US Congress, noted last week that Palau’s Finance Minister Kaleb Udui told a congressional field hearing in August that Beijing had been trying to tempt locals to oppose US plans to build an early-warning radar by offering to build a hotel and casino nearby.
The Washington embassies of Palau and the Marshall Islands did not immediately respond to requests for comment.
The Biden administration has made renewing the COFAs a priority, and it has broad bipartisan support, but congressional infighting is not the only hurdle.
Howard Hills, a senior adviser to the US COFA negotiating team from 2020 until retiring last month, blamed the Marshall Islands holdup on US State Department lawyers who wanted to control how new funds were spent and objected to them being earmarked to address the nuclear legacy, fearing this could lay the US open to more claims.
Asked to comment, the State Department said Washington was “working expeditiously to finalise negotiations” with the Marshall Islands and had had constructive conversations to that end “including at the Presidential level” at last week’s US-Pacific Islands Forum Summit.
Source: CNA
