China has been pampering the Federated States of Micronesia with gifts. Besides waves of cash assistance and medical supplies recently donated to FSM, Beijing is building a new passenger-cargo vessel that will replace the now idle and dilapidated Hapilmohol-1 ship it earlier bestowed on Yap.
These were just tokens of the intensifying romance between FSM and China, which makes the United States apprehensive. Washington is keeping track of China’s “comprehensive strategic partnership” with FSM and knows it needs to keep up.
“China is a major provider of economic assistance and investment for FSM. Chinese entities have financed and constructed major government buildings, a sports facility, a bridge and other infrastructure, and upgraded Chuuk International Airport. Other China’s assistance includes other financial assistance; technical assistance; disaster and medical assistance; agricultural, biogas, solar energy, and climate adaptation projects; ship repair; and light utility aircraft,” states a recent Congressional Research Service report. “In December 2019, FSM President David Panuelo visited China and received promises of $72 million in further economic assistance.”
Regional observers are ill at ease with Beijing’s largesse, worried that FSM is becoming the communist nation’s gateway into the region which the U.S. military seeks to fortify.
While Beijing has a growing influence in the southwest Pacific, the CRS report said China’s engagement in the freely associated states “is relatively limited due to the U.S. economic and security presence in the Compact states.”
National security experts have recommended a military buildup in the freely associated states, which have assumed greater importance as U.S. security partners amid China's growing threat in the region, according to CRS.
The Pacific nations' strategic importance to the U.S. defense system is among the key points of discussion between Washington, D.C. and freely associated states— Palau, Marshall Islands and Federated States of Micronesia — as they negotiate the possible extension of the expiring provisions of the Compacts of Free Association.
CRS cited a report by the Center for a New American Security (CNAS), which recommended “renewing and fully supporting” the Compacts, noting that the treaties “provide irreplaceable access to critical geography” as the U.S. seeks to advance its Indo- Pacific strategy.
The CNAS report was mandated under the 2019 National Defense Authorization Act. The Washington D.C.-think tank also recommended that the U.S. military develop “support infrastructure and greater access at existing airfields” and improve runways and infrastructure at key locations in the Compact states “like Palau and Yap.”
For Palau, this is a welcome proposition. In September, Palau President Tommy Remengesau Jr. wrote to U.S. Secretary of Defense Mark Esper expressing the country's willingness to host U.S. military bases.
The congressional report details the Compact economic assistance, funded through the Department of the Interior, which expires in 2023 for the Marshall Islands and FSM and 2024.
During the second Compact term covering the period 2004 to 2023, U.S. grant assistance and trust fund contributions to the Marshall Islands are to total $722 million and $276 million, respectively. Micronesia is to receive $1.6 billion in grant assistance and $517 million in trust fund contributions during the same period.
“Some U.S. policymakers and experts have expressed support for continued economic assistance to the FAS, given their ongoing economic dependency, U.S. historical obligations, and the perceived need to counter China’s rising influence in the region,” the report said.
The CRS report also noted the Compact nations’ contribution to U.S. military efforts and advancement of U.S. diplomatic and security interests globally and in the Pacific Islands region. Marshall Islands, for example, hosts the U.S. military’s Ronald Reagan Ballistic Missile Test Site on Kwajalein Atoll.
“Some experts recommend that the United States government should further integrate the FAS into its free and open Indo-Pacific strategy,” the report said.
In December 2018, the U.S. military held discussions with the FSM government about building naval facilities, expanding an airport runway for military use, and engaging in military exercises in FSM.
CRS also noted that China exerts some economic pressure in Marshall Islands and Palau, despite their diplomatic relations with Taiwan.
“(China) is one of the principal trading partners of the Marshall Islands, largely reflecting its export of transport vessels to the RMI,” the report said. The Marshall Islands has one of the world’s largest ship registries, but RMI ships entering Chinese ports pay higher fees due to the Marshall Islands not having diplomatic relations with (China).”
In 2018, Beijing banned Chinese tourists from visiting Palau, which is heavily dependent on tourism revenue, reportedly to pressure Palau into switching diplomatic relations from Taiwan to the PRC.
The United States renewed focus on the Pacific island countries began in recent years.
In May 2019, FAS leaders visited the White House for the first time. Palau President Tommy Remenegsau, FSM President David Panuelo and then Marshall Islands President Hilda Heine met with U.S. President Donald Trump. This was followed by Secretary of State Mike Pompeo’s visit in August 2019, and U.S. Secretary of Defense Mark Esper’s visit to Guam and Palau this year.
On Oct. 19, Secretary of the Navy Kenneth Braithwaite visited Palau to further strengthen the U.S. commitment to the allied nation.
Braithwaite's visit, Remenegsau said, provides an "opportunity to rekindle and reinvigorate the strong friendship and relations that Palau and U.S. enjoy."
"I am here to ensure that Palau understands our commitment to the security of the region, our commitment to the freedom of navigation in the seas surrounding Palau," Braithwaite said.
In other parts of the region, the National Security Council on Oct. 24 announced the Trump administration’s plan to station a fast-response cutter to American Samoa in an effort to beef up the U.S. Coast Guard’s presence in the Western Pacific amid China’s unabated aggression in the region.
MLXL “We are making infrastructure advancement in American Samoa to make this possible,” Robert O’Brien, President Trump’s national security advisor, said. “A new fast-response cutter will enhance the Coast Guard’s footprint in the islands and its ability to patrol, surveil and protect, as well as enforce its laws.”
O’Brien said the USCG is currently conducting a $5-million feasibility study to evaluate the plan for the U.S. territory, and if the survey is favorable, the U.S. could further expand its presence in the South Pacific