U.S. negotiators have agreed to drastically increase funding for the Marshall Islands as part of ongoing efforts to renegotiate for a third time the terms of a decades-old treaty between the two nations.

The talks are part of three separate negotiations the U.S. is conducting with the Marshall Islands, Palau and the Federated States of Micronesia.

The current funding for treaties with the Marshall Islands and the FSM expire later this year.

The agreements, known as the Compacts of Free Association, effectively give the U.S. military control over a huge swath of the western Pacific that — when combined with the U.S. Pacific territories of Guam and the Northern Marianas — is on par with the size of the continental U.S.

These American strategic denial rights over the three nations’ surrounding waters and airspace have grown increasingly important as China has sought to strengthen its ties with Pacific communities.

Left to right: Assistant Secretary for Insular and International Affairs Carmen Cantor, Special Presidential Envoy for Compact Negotiations Joseph Yun, Marshall Islands Minister of Foreign Affairs and Trade Kitlang Kabua and Marshall Islands Ambassador to the United States Gerald Zackios. Courtesy: U.S. Department of the Interior

What’s up in the air now isn’t the military components of the compacts, but the funding that helps ensure the Pacific nations that cede their air space and territorial waters to the U.S. are able to pay for local services like health care and education.

Marshall Islands Chief Negotiator Kitlang Kabua declined to specify how much money this latest agreement might cost, but said the new funding — which would cover a 20-year period — would be nearly four times more than what the country received between 2004 and 2023.

During that time period U.S. grants and trust fund infusions to the Marshall Islands totaled nearly $1 billion.

Kabua said that the negotiators recognized the need for a balanced agreement, noting the U.S. is exercising key sovereign rights of the Marshall Islands, the strategic control over the country’s land, water and airspace. That includes the Ronald Reagan Ballistic Missile Defense Test Site on Kwajelein Atoll.

“This is a relationship, a partnership that should be enduring,” Kabua said.

The Pacific Island Times reported that Palau President Surangel Whipps Jr. said that the U.S. had similarly agreed to double its 20-year funding to the island nation compared with the previous two-decade funding period, which ends in 2024.

“The compact and its economic assistance provisions should be a mechanism for Palau to increase its resiliency from threats like the pandemic, climate change, and market disruptions,” the paper reported Whipps said.

Details Of Marshall Islands Agreement

The U.S. previously sought to taper off its financial support of the Marshall Islands and the FSM through the creation of trust funds that were expected to produce enough money to eliminate the need for additional congressional funding. That didn’t happen.

Kabua said the Marshall Islands still needs time to strengthen its economy and requires U.S. funding to address major challenges in the region.

“Of course, as a government, we need to strive for a sustainable future. However, there are needs that have not been addressed by the U.S. government, those of the nuclear affected folks, and new, extraordinary phenomenon and challenges that we face today, such as climate change,” Kabua said.

About $700 million alone is expected to go to a repurposed trust fund, according to reporting in the Marianas Variety News by Marshall Islands journalist Giff Johnson.

Kabua said that U.S. special presidential envoy Joseph Yun had suggested the concept of the repurposed trust fund, which will allow the Marshall Islands government to pay for its own priorities including helping people affected by historic U.S. nuclear testing, ongoing U.S. military activities and climate change.

“To have some way to support these people who have been neglected for so long is quite important,” she said of victims of U.S. nuclear testing.

Overall, the funding will help extend health care and education operating grants as well as support an upgraded health care facility to serve not only people affected by U.S. nuclear testing in the islands but also Marshallese residents in need of health care services locally.

Money would also go to environmental protection and climate change adaptation, and to support technical assistance for a new joint task force to help the Marshall Islands access programs, services and financing to mitigate climate change.

The funding would also be used for a new museum and a research facility dedicated to the legacy of U.S. nuclear testing in the region, including funding to better access documentation and files that have yet to be declassified.

“This is something that is still not available to the people of the Marshall Islands in full,” Kabua said. “The more that we know, the more that we can acknowledge the horrid legacy.”

She said part of the funding includes payments for educational grants that weren’t allocated despite being promised during the last round of negotiations and could also be using for job training opportunities.

Additional funding would go to support infrastructure outlined in the master plan for development of Kwajalein Atoll.

Waiting On Congress

It will still be several months before the details of the treaties are all worked out. The U.S. has also reached a tentative agreement on funding for Palau. Palau Finance Minister Kaleb Udui Jr., who is leading negotiations for the country, did not respond to a request for comment.

Joseph Yun, the presidential special envoy who is leading negotiations on behalf of the U.S., declined an interview request via a State Department spokesman.

He told The Associated Press that Chinese interest in the Pacific was a factor in negotiations.

The State Department also declined to release copies of the memoranda of understanding signed this month between the U.S. and the Marshall Islands, and the U.S. and Palau, and declined to expedite a request for the records.

Negotiations with the Federated States of Micronesia are still ongoing and the U.S. has yet to announce an agreement on budget estimates.

Since the Trump administration, U.S. negotiators have sought to extend the compacts as is, providing the same level of funding as the previous, second round of negotiations.

Sen. Mazie Hirono praised the Biden administration for its progress and said all three Pacific nations “are important diplomatic, economic, and defense partners.”

“Our obligation to the COFA nations extends to their citizens, which is why I’ve been working for years to reinstate federal benefits for COFA citizens,” the Hawaii senator said in a statement. “I was proud to be able to get Medicaid benefits reinstated in 2020 and I’ll continue to pursue every avenue available to restore benefits to all federal programs, including through the different components of the renegotiation.”

Rep. Uifa’atali Amata Radewagen from American Samoa, who co-chairs the Congressional Pacific Islands Caucus, said in a press release this week that she hopes the State Department gives Congress the details of the funding needed “without further delay,” noting that the negotiations “were on diplomatic life-support a year ago.”

“Along with my colleagues in Congress, there will be many questions I will have about what to expect as terms are worked out leading to final agreements,” she said.

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