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$250 million compact aid near at hand

By Bernadette H. Carreon KOROR, Palau (Palau Horizon, Sept. 13, 2010) – In Palau, several agreements included in the newly-signed Compact of Free Association financial package need the advice and consent of the Olbiil Era Kelulau (OEK/Congress).

President Johnson Toribiong and members of the Compact advisory group appeared Wednesday before OEK to brief the lawmakers regarding the review.

"I concluded on Sept. 3, agreements with the government of United States of America following the review provided for in Section 432 of the Compact of Free Association," Toribiong told Congress leaders.

President said the agreements pertaining to federal programs and services included in the new Compact have to undergo Palau’s Congress’ approval.

The provisions pertaining to federal programs of health, education and public safety among others has to pass Congress.

Last week Palau and the United States finally signed the US$250 million Compact of Free Association financial package.

Lawmakers are also required to pass the provisions pertaining to the infrastructure maintenance fund, fiscal consolidation fund, infrastructure projects and the audit standards and responsibilities.

The signing of the economic aid brings into conclusion the review which has been delayed for months.

He said the agreement requires the establishment of a body which will institute economic and financial reforms for Palau. The composition of the body needs to be approved by the United States.

Although the two teams have concluded the review, an official signing which will be transpiring on Palau will also be scheduled.

The official signing will happen after Palau Congress adopts the agreement and the U.S. Congress approves the funding appropriation.

Palau has accepted a US$250 million financial package in January. The package will cover a period of 15 years.

Both the U.S. and Palau conducted a year-long review of the Compact and Palau will have another opportunity to review the Compact after year 2024.

U.S provides US$18 million in annual subsidies and grants. The economic provision expired on September 30, 2009

The military and civil defense provisions will remain until 2044.

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