PALAU PRESIDENT ATTENDS U.S. COMPACT HEARING

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Toribiong to testify on Compact review, $250 million funding

By Aurea Gerundio-Dizon KOROR, Palau (Island Times, May 19, 2011) – Senator Jeff Bingaman of New Mexico invited President Toribiong to testify at the Senate committee on energy and natural resources’ hearing on the bill approving the results of the 15-year review of the Compact of Free Association between Palau and the United States.

The hearing was set on June 16 at 10:30 a.m. in room SD-366 of the Dirksen Senate Office Building in Washington DC. Toribiong confirmed he will attend. He has five minutes to testify at the hearing.

The bill is critical to Palau as it includes the agreement that US will extend US$250 million financial assistance to Palau up to 2024. The first 15 years of the Compact expired in September 2009.

The agreement including the extension of financial assistance was signed by US and Palau officials in September 2010 but it needs to pass the US Congress as well.

Pending approval by the US Congress, the US government agreed to provide financial assistance to Palau in the same level as in fiscal year 2009.

Under the new agreement, Palau is anticipated to have meaningful improvements in fiscal management, including elimination and prevention of operating deficits, reduction in the national operating budget from previous fiscal year, reduction in the number of government employees from the level of previous year, reduction in the budget for government salaries from previous year, reduction of government subsidization of utilities and meaningful tax reforms by the time both countries hold bilateral consultation.

If no reforms will be made, the US may delay payment of economic assistance.

Island Times © 2011 Island Times. All rights reserved

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