Palau | Freedom House

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Palau received a one-year extension of its Compact of Free Association with the United States in 2009, providing Palauans with continued access to education and employment in the United States and its territories. A number of senior political leaders, including former president Tommy Esang Remengesau, were convicted of official abuse and corruption during the year.  

The United States administered Palau, consisting of eight main islands and more than 250 smaller islands, as a UN Trust Territory from 1947 until 1981, when it became a self-governing territory. Palau gained full independence in 1994 under a Compact of Free Association with the United States, which stipulated that the United States would grant Palau a total of $442 million in economic aid between 1994 and 2009; allow Palauan citizens to reside, work, and study in the United States and its territories and have access to a variety of federal government programs; and defend Palau in exchange for U.S. military access to the archipelago until 2044.
Tommy Esang Remengesau was first elected president in 2000 and won a second term in the 2004 general election. Johnson Toribiong was elected president in the November 2008 elections, defeating Elias Camsek Chin, the former vice president. Parliamentary elections were held the same month, with all candidates running as independents. Seeking U.S. aid beyond 2009 was the central political issue, as the island’s economy is highly dependent on compact funds. In July 2009, the United States agreed to extend the compact agreement for one year beginning October 1, 2009, maintaining the same payment amounts. The extension provides Palau with much needed financial relief, as the country carries a large national debt and has experienced a considerable decline in the tourism industry. Due to economic hardship, the parliament rejected Toribiong’s request in August for significant salary increases for the president, vice president, and cabinet members.
Several high-ranking local and national public officials faced corruption charges in 2009, leading to a number of convictions. The speaker of the Koror state government was convicted of perjury and misconduct in January, while the governor of Melekeok state was found guilty of using public funds for personal purposes in April. In November, former president Remengesau was found guilty of misconduct, including the stealing of public funds; he faces up to $1.2 million in fines. In August, the former head of economic development was charged with unlawful fishing and employment of non-resident workers, andthe ombudsman faced charges of forgery.

In June, the Palauan government accepted a U.S. request to resettle 17 Chinese Uighur Muslims who had been detained at the U.S. Naval Base at Guantanamo Bay in Cuba. By year’s end, 6 of the 17 had moved to Palau. The Palauan government denied accusations by opponents that financial compensation was tied to the deal, stating that the decision was strictly humanitarian. In August, the parliament passed a bill to permit dual citizenship, an amendment supported by voters in a referendum that had been held alongside the November 2004 general elections.

Political Rights and Civil Liberties: 

Palau is an electoral democracy. The 2008 presidential and parliamentary elections were considered free and fair. The bicameral legislature, the Olbiil Era Kelulau, consists of the nine-member Senate and the 16-member House of Delegates. Legislators are elected to four-year terms by popular vote, as are the president and vice president. The president may serve only two consecutive terms. The country is organized into 16 states, each of which is headed by a governor, and each with a seat in the House of Delegates.
There are no political parties, though no laws prevent their formation. The current system of loose political alliances that quickly form and dismantle has had a destabilizing effect on governance.
Official corruption and abuse remain serious problems. Many public officials have been implicated and found guilty in recent years, including several convictions in 2009. To improve transparency and financial accountability, new anti-money-laundering measures were introduced in 2007, though evaluations have found significant deficiencies in due diligence, record keeping, and monitoring, and the attorney general’s office lacks the resources to oversee implementation of these measures. Palau was not rated in Transparency International’s 2009 Corruption Perceptions Index.
Freedoms of speech and the press are respected. There are several print publications, five privately owned radio stations, and one privately owned television station. Cable television provides rebroadcasts of U.S. and other foreign programs. While internet access is not impeded by the government, diffusion is limited by cost and a lack of connectivity outside the main islands.
Citizens of Palau enjoy freedom of religion. Although religious organizations are required to register with the government, no application has ever been denied. There have been no reports of restrictions on academic freedom, and the government provides well-funded basic education for all.
Freedoms of assembly and association are respected. Many nongovernmental groups represent youth, health, and women’s issues. Workers can freely organize unions and bargain collectively, though the economy is largely based on subsistence agriculture and is heavily dependent on U.S. aid and rent payments and remittances from Palauans working overseas.
The judiciary is independent, and trials are generally fair. A 300-member police and first-response force maintains internal order. Palau has no military. There have been no reports of prisoner abuse, though overcrowding is a problem in the country’s only prison.
Foreign workers account for about one-third of the population and 75 percent of the workforce.There have been reports of discrimination against and abuse of foreign workers, who cannot legally change employers once they are in Palau and are paid far lower wages than Palauans. Foreigners are said to use fake marriages to exploit immigration privileges to the United States under the compact, making Palau a transit point for human trafficking from China, the Philippines, and Taiwan to the United States. In response to social tensions and a slower economy, the government in September 2009 decided to limit the number of foreign workers present in the country at any time to 6,000. In November, authorities began cracking down on illegal migrants and said that they would repatriate some 240 Bangladeshi workers with expired work permits.
Women are highly regarded in this matrilineal society, in which land rights and familial descent are traced through women. Many women are active in traditional and modern sectors of the economy and in politics, though there are no women in the parliament. The number of domestic violence and child abuse cases remains small.Sexual harassment and rape, including spousal rape, are illegal.