Foreign policy and defense
Micronesia is a nation in Micronesia. Its capital city is Palikir. In foreign policy, the Micronesian Federation’s relationship with the United States is completely dominant. Relations between the two countries are regulated in the 1986 Compact of Free Association agreement.
The agreement states that the Micronesia Federation is independent but that the United States is responsible for the country’s defense and has great influence over foreign policy. The United States has the right to establish military bases on the islands and prevent other states from doing the same. The United States undertakes to make an annual financial contribution to the Micronesia Federation (see Current Policy). The agreement grants citizens of the Micronesia Federation the right to study, work, and reside in the United States without a residence permit.
- Countryaah: Overview of business holidays and various national observances in Micronesia for years of 2020, 2021, 2022, 2023, 2024 and 2025.
The country also has extensive cooperation with the other small states in the Pacific, including fishing, environment, tourism and education. The cooperation takes place, among other things, within the framework of the Pacific Islands Forum (PIF) and the Pacific Community, as well as a cooperation organization between the Micronesian states and territories Micronesian Federation, Marshall Islands, Palau, the Northern Mariana Islands and Guam (the Micronesian Chief Executives’ Summit, MCES). In July 2011, MCES decided to create the world’s first regional shark protection zone in Micronesian waters.
China’s interest in the small states of Oceania has grown since the turn of the millennium. The Micronesia Federation receives assistance from China, which also makes major investments in the country. The two states cooperate in areas such as energy, fisheries, tourism development and infrastructure. However, Chinese plans to build a large hotel complex at Yap have met with opposition from both locals and politicians, as the island is located only 80 miles from Guam where the United States has a large military base.
Japan also provides financial support to the Micronesia Federation and the countries cooperate to develop the infrastructure, tourism and fishing industry in the Pacific nation. Japan is the country’s second largest donor after the United States.