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Palau

Introduction to Palau

After three decades as part of the UN Trust Territory of the Pacific under US administration, this westernmost cluster of the Caroline Islands opted for independence in 1978 rather than join the Federated States of Micronesia. A Compact of Free Association with the US was approved in 1986, but not ratified until 1993. It entered into force the following year, when the islands gained independence.

Government

Capital:

Koror; note - a new capital is being built about 20 km northeast of Koror 

Independence:

1 October 1994 (from the US-administered UN Trusteeship) 

National holiday:

Constitution Day, 9 July (1979) 

Economy

Economy overview:

The economy consists primarily of tourism, subsistence agriculture and fishing. The government is the major employer of the work force, relying heavily on financial assistance from the US. Business and tourist arrivals numbered 50,000 in FY00/01. The population enjoys a per capita income twice that of the Philippines and much of Micronesia. Long-run prospects for the key tourist sector have been greatly bolstered by the expansion of air travel in the Pacific, the rising prosperity of leading East Asian countries, and the willingness of foreigners to finance infrastructure development. 

GDP:

purchasing power parity -$74 million
note: GDP estimate includes US subsidy (2001 est.) 

Agriculture products:

coconuts, copra, cassava (tapioca), sweet potatoes 

Industries:

tourism, craft items (from shell, wood, pearls), construction, garment making 

Transportation

Highways:

total: 61 km
paved: 36 km
unpaved: 25 km

Ports and harbors:

Koror

Airports:

3 (2003 est.)