President’s 2010 Annual Progress Report

Text of President Johnson Toribiong’s 2010 Annual Progress Report Delivered to the Senate and House of Delegates of the Eighth Olbiil Era Kelulau on April 26, 2010

Good morning.  Reklai, Ibedul, Bilung, Ebil Reklai, Mr. Senate President and Honorable Senators, Mr. Speaker and Honorable Delegates of the Eighth Olbiil Era Kelulau, Distinguished members of the Diplomatic Corp, Honored guests, my fellow Palauans, Ladies and Gentlemen.  Thank you for your attendance this morning to receive my annual report on the progress of my administration.

This annual progress report is required by Article IIX, § 13 of our Constitution which provides that, “The President shall make an annual report to the Olbiil Era Kelulau on the progress of his administration.”

My fellow Palauans, it has been slightly over one year since I stood before you to deliver what then amounted to a quarterly progress report: a report of the first three months of my Administration.  Today I stand before you to deliver an annual progress report: a report of the progress, and frankly, in some instances, the need for progress that our dear country has experienced since I last stood before you.

As I just stated, the Supreme Law of our land mandates that the President deliver an annual progress report to the Olbiil era Kelulau.  This is done to assure that the citizens of Palau, the people who elected us and whom we serve, are fully aware of the accomplishments, challenges and plans of their national government.

It is the right of our citizens to know what their national government is doing to ensure that their fundamental rights, freedoms, and general welfare as citizens of Palau are being fully protected and fostered by their elected leaders.  Thus, it is my constitutional duty and, may I add, my honor to stand before you today to make this annual progress report.

As I explained to you one year ago, despite my having been in office only three months at that time, my Administration was faced with many challenges, some new and others that had remained unresolved, some for many years.  As you all know, it is easier to identify problems than to solve them.

As I stood before you one year ago, I told you that the state of our Republic was “precarious”, but that I was optimistic for the future of our country.  I say to you today that during the last year, while the sea has been rough and stormy at times, the course of our nation has been steadied. When the seas were rough, we all remained calm, and for that I would like to thank you, the Honorable Senators, Delegates and my dear people of Palau for your patience and faith in our collective leadership.  We have identified the problems and challenges, and one by one, we have began to address them.

Our nation has been steered away from the treacherous waters.  We still have some way to go until we are in calm waters and safe harbor, but truly we are on our way there.  I am more optimistic today for the future of our country than I was last year.

Ladies and Gentlemen, I think it is appropriate and fitting that we remind ourselves that we, the People of Palau, are very fortunate to have many friends in this world.  Friends whose understanding, assistance, and cooperation have contributed substantially to the advancement of our nation, and for that we are most grateful.

The United States, a super power, has so generously provided political and financial support to our island nation, and must be singled out in this regard.  Honorable Chargé d’ affaires William Berkel, please stand and be recognized.  Please convey my personal thanks and the thanks of all the People of Palau to President Barrack Obama, to the United States Government and to the People of the United States for all that they have done for us, for being our friend and our ally, for being our partner under the Compact of Free Association.

My Administration will work closely with the United States to do what is necessary to ensure our mutual security under our unique and special relationship of the Compact of Free Association.  My Administration’s fundamental and enduring commitment is to continue to strengthen the relationship and the friendship between our two countries even further.  I will work tirelessly to accomplish that goal.  Thank you, United States of America.

I would also like to recognize a former neighbor from the north, a native son of Guam, who has climbed the ladder to success and is now the Assistant Secretary of the Department of Interior for Insular Affairs, the Honorable Tony Babauta.  Assistant Secretary Babauta is directly responsible for overseeing much, if not all, of the economic assistance flowing to Palau under the Compact of Free Association and is here in Palau to make sure that the money under the Compact is well spent. Assistant Secretary Babauta, please stand up and be recognized.  We are proud that a native son of the Pacific has risen to such a position of prominence and authority.

Of course, I do not need to remind you that the United States is not the only friend of Palau.

I again want to convey my respects and to express the deeply felt gratitude of the Palauan people to the Government of Japan for all it has done for Palau over the years.  We do not take your friendship lightly.  Your Excellency Ambassador Yoshiyuki Sadaoka, please stand and be recognized.  Please assure your Government of my Administration’s fundamental and enduring commitment to strengthen the historical relationship and the friendship between the People of Palau and the People of Japan.

Another loyal and generous friend on the international scene that must also be recognized is the Republic of China-Taiwan. We just celebrated the 10th anniversary of our diplomatic relations.  Since I was Palau’s first Ambassador to the Republic of China-Taiwan for several years before becoming your President, I must say that the Republic of China-Taiwan occupies a special place in my life and heart.  In fact, I chose to make my first State Visit to Taiwan to emphasize how grateful Palau is for our relationship and friendship.

Just a month ago, His Excellency President Ma Ying-jeou visited our island nation.  Just over a week ago, the Republic of China-Taiwan Naval Fleet of Friendship visited our shores.  Their visits demonstrate our close and strong relationship with the Republic of China-Taiwan.  Your Excellency Ambassador Maggie Tien, please stand and be recognized.  Please assure your Government of my Administration’s fundamental and enduring commitment to continue to strengthen the relationship and the friendship between our two countries.

Last but not least, our closest neighbor and friend, the Republic of the Philippines, must likewise be recognized.  On issues of health, education, and human resources, our countries have had a symbiotic relationship.  For that, I would like to recognize His Excellency Ambassador Ramoncito Mariño.  Ambassador Mariño, please stand and be recognized.  Please convey our gratitude to your Government and to the people of the Philippines.  Thank you!

Indeed, words cannot adequately express how thankful we are to all of our friends and allies around world!

When I took office last year, despite the National Government having spent significant sums of money, no measurable progress towards achieving a meaningful Review of our Compact with the United States had been accomplished.  The Compact funding that our Republic had been receiving for the last 15 years was scheduled to expire on September 30th of last year.  Thus, on the day I was inaugurated, my Administration was left with the steep challenge of having to find direct additional funding of $15 to $20 Million for this year’s budget to replace the direct economic assistance that had been coming to Palau under the Compact.

This was by far the most significant challenge facing my Administration when I took office.  Given the potential of having to downsize our Government and public services to our people due to a lack of funding, I placed the highest priority on this challenge.  To my mind, there is nothing more important to the Republic of Palau than to conclude a favorable Review of the Compact.  As a result, over the last year this issue has continued to dominate my Administration’s agenda.

My 2009 Progress Report advised you of the challenge with the Compact Review and the steps that I had taken at that time to address it.  Because of the impending termination of the direct Compact funding by the time of my last Progress Report I had decided that Palau and the United States no longer had the luxury of time to complete the review of the Compact before the September 30thdeadline.  The impending expiration of the provisions of the Compact that provided for direct economic assistance to Palau endangered our economic and political advancement and created potential security and political stability issues.

Under such circumstances, I advised you that I had traveled to Washington D.C. in mid-March of last year to personally meet with United States Secretary of State Hillary Clinton, United States Secretary of Interior Ken Salazar, and with several Senators and Representatives of the United States Congress.  I asked them to support an extension of the funding and programmatic provisions of the Compact for one additional year to end on September 30, 2010.

Although it took several additional months of work and concern, I am proud and pleased that my trip to the United States was ultimately successful in obtaining a one year extension of the direct funding and federal programmatic provisions of the Compact.  As a result of my efforts, the United States was convinced and agreed to extend to Palau for Fiscal Year 2010 the same amount of funding and programmatic assistance that Palau received in Fiscal Year 2009, which was approximately $13.25 million.  This limited the amount of money we needed to withdraw from the Trust Fund from $15 million to only $5 million.  Based upon that extension of funding, the Olbiil Era Kelulau is now considering the Supplemental Budget, which I submitted to them on January 20, 2010,

Over the last year my Compact Review Advisory Group, under the direction of his eminence, the very capable Ambassador Joshua Koshiba, has continued to engage in a Review of the Compact with representatives of the United States Government with the goal of concluding amendments to the Compact to assure that there are adequate resources to meet the Government of Palau’s operating requirements and development objectives, not just for today but for the future.

Ambassador Koshiba and the members and staff of his group have met countless times to discuss proposals and strategies to accomplish the foregoing goal.  They have traveled to the United States several times to sit across the table with the United States representatives to the Compact Review.  They have been in constant consultation with me, as the Compact Review at this time in history is our most critical challenge.

Starting with an almost complete indifference and reluctance by the United States to even engage in a Review of the Compact, much less to offer additional direct economic assistance, Ambassador Koshiba’s Group was able to convince the United States team that Palau needed economic assistance above and beyond that was provided in the Compact when it was signed in 1994.  Ambassador Koshiba’s group considered and negotiated interim proposals for economic assistance from the United States amounting first to approximately $51 Million, then to approximately $170 Million, and, most recently, to $250 Million in direct economic assistance plus continued United States federal programmatic funding.

As you may have heard or read in the press, in late January of this year I accepted and the parties have generally agreed to the foregoing $250 Million package plus federal programmatic assistance, and that amount has been submitted to the United States Congress in President Obama’s Fiscal Year 2011 budget proposal.  However, the details of the specific allocation of the $250 Million proposal are still under discussion as I speak.  And while the saying goes, “The devil is in the details,” I fully expect the details to be resolved shortly and an agreement signed.

Once an agreement has been signed then legislation to ratify the same will be introduced in the United States Congress and in our Olbiil Era Kelulau.  Palau has many friends in the United States Government and within the United States Congress who, I am sure, will fully support this agreement and help us to realize its ratification and implementation in the very near future.

The Compact in effect is most critical to our Republic, as it is the foundation of our security, economy and budget, not just for a year but for the future.

During my inauguration address I said: “In as much as precious little has been accomplished so far on the subject of Compact Review, getting the United States to join Palau at the same table and to review the Compact will be my administration’s first and highest priority.”  The process of the Compact Review, I am proud to report, has been successful beyond our original expectation.

When I stood before you last year Palau was also faced with the problem of the global economic slowdown.  When I took office our Compact Trust Fund had lost over $60 Million of its value due to the downturn in the American money market caused by the global recession.  As Wall Street suffered, so did the Republic of Palau.  At one point the Compact Trust Fund had been valued at almost $170 Million, but was worth less than $110 Million after I took office in January of last year; a decline of over 35%.

I am extremely happy to report to you, however, that in the last twelve months the world’s economy had started to slowly recover, and as Wall Street has regained its losses, so has Palau’s Trust Fund.  As of the end of March of this year, the Compact Trust Fund had increased in value to $151 Million and continues to grow.

Of course, I do not need to tell you that the Trust Fund was and is Palau’s hope to some degree of economic self-sufficiency as the direct economic assistance we are receiving under the Compact declines.  The Compact Trust Fund is the legacy we hope to leave for future generations of Palauans.

However, it must be noted that the Trust Fund alone is insufficient to fund our government’s operating requirements and boost our economic development towards economic self-sufficiency. The good news is that the $250 million package that we have agreed to with the United States will allow the Trust Fund to heal itself to a level that will sustain us into the future. But in the interim, we must take every action necessary to promote development towards economic self-sufficiency. It cannot be overstated that the economic package provided under the Compact is not a permanent solution for our economic and financial needs; it is meant only to be a stepping stone from which Palau must exert every effort necessary towards the achievement of economic self-sufficiency.

As had become readily apparent last year at this time, our Republic was suffering from inadequate supply of electricity and blackouts.

The problems we had with electricity concerned me greatly.  Our power distribution and generating infrastructure is one of the pillars of our economy and livelihood.  Electricity has become indispensible to our way of life.  Indeed, the general welfare of our people, local businesses and foreign investment depend upon reliable and adequate provision of electricity.

Within the first few weeks of my Presidency I put together a task force to study the problems at the Palau Public Utilities Corporation and I asked for and received a grant from the Department of Interior to hire an outside expert to review the situation.  Again, Assistant Secretary Babauta, thank you!  The recommendations of the task force and of the outside expert were that I make changes at the highest levels of PPUC’s management structure which I did.

I am happy to report to you today that under its newly constituted Board and new General Manager the PPUC has worked through the maintenance and operational problems that existed.   The PPUC is in the process of purchasing two new baseline generators which should be up and running in the not too distant future.  The constant brownouts and blackouts we were suffering then have become few and far between and in the not too distant future will only be bad memories.

After taking office last year I became concerned when I learned that National Government was deeply in debt and failing to timely pay its obligations.  The National Government was in debt to the tune of approximately $7 Million and, in some cases, those debts were many years old. The National Government was also in default of its loans.

Our Nation owed hundreds of thousands of dollars to various international organizations. For example, in the United Nations, our right to vote was suspended due to our failure to pay our dues. Moreover, we had become ineligible for many of the grants available from these organizations.

We were behind on our loan payments to the Mega Bank of Taiwan to the tune of almost $2 Million on a loan whose principal was about $28 Million.  I am pleased to report that we are now current and will do our best to keep our obligations current. The default was threatening the continued availability of the grants and soft loans to Palau from the government and commercial banks of the Republic of China-Taiwan.

Private local and overseas vendors were owed several millions of dollars.  Many had stopped supplying Palau with goods and services.  Our hospital was having problems securing pharmaceutical supplies because of unpaid bills. I am also proud to report that we are now current with our hospital’s obligations.

The failure to pay the local vendors in particular had a debilitating ripple effect on our economy.  Because the National Government was not paying them, the local vendors as well as our local economy suffered.

As I will be explaining to you, our local revenues, the money that our National Government uses to pay most of the debts I have described above, are still lagging.  Nevertheless, while it has been difficult because of the lack of cash, I am happy to report to you that the National Government has used the current revenues to retire virtually all the old debts that my Administration inherited.  While this process has left us with new debts, these debts are current and I am now in the process of retiring these new debts using current revenues.

Along the same lines, I have asked the United States to allow the National Government to apply a portion of the $250 Million Compact Review package: $5 Million in fiscal year 2011 and $5 Million in fiscal year 2012, to our debts.  I will bring our National Government current before I leave office. As I said during my inaugural address: “We have lived beyond our means by borrowing from the future of our children. It is our obligation to pay our debts and to live within our means.”  I am committed to leaving a legacy where payments for all our government’s obligations are current.

The last year has seen a significant change in the image that Palau projects to the rest of the world.  Palau is no longer just a diving destination, Palau has become, in the view of some, an active participant in the international community.

As all of you are aware, in June of last year United States President Barrack Obama sent Ambassador Daniel Fried to Palau to ask me if the Republic of Palau would consider allowing several ethnic Uyghurs detained by the United States at the Guantanamo Bay Detention Facility in Cuba to be resettled in Palau.  After consulting with Paramount Chiefs Ibedul and Reklai, presiding officers of the OEK, my Ministers, and with my Legal Counsel to ascertain my constitutional and legal authority, on behalf of the Government of the Republic of Palau I consented to the request of the United States and offered to accept for temporary resettlement in Palau up to seventeen Uyghur detainees.

My decision to offer to temporarily resettle these ethic Uyghurs was a humanitarian gesture intended to help these detainees—all of whom had been approved for release because they were determined no longer to be enemy combatants—be freed from any further incarceration and to restart their lives anew in as normal a fashion as possible.

While I know that my decision to allow several of the Uyghurs to resettle in Palau was a controversial one for some of you, the offer was in accord with our age old cultural tradition of accommodating and helping people in need and was a recognition of our long standing and strong relationship with the United States. It gave us an opportunity to return a favor to the United States who has done so much for Palau thereby further strengthening our relationship with the United States.

Palau’s agreement to resettle the Uyghurs in Palau was broadcast worldwide over television and the Internet and, by all accounts, was considered to be an act of statesmanship by a nation who nobody would have thought had the courage to take such an act.  The value of the publicity that Palau enjoyed as a result of my decision is incalculable, although an unintended but not unenjoyable consequence may be the good will and flexibility the United States is showing Palau in our Review of the Compact.

We all know that Palau is a small nation and, in the larger scheme of things, fairly insignificant.  But that is no reason for us not to do what we can, however insignificant that may be, to contribute to the solution of the myriad of problems that face this world, particularly the problems that face our closest ally, the United States, especially in the area of human rights and freedom. In this connection it should be pointed out that with the consent and blessing of the traditional and elected leaders of Peleliu I have signed an agreement with Japan to allow them to repatriate the remains of thousands of their soldiers which were left behind in Peleliu. This was a humanitarian gesture extended to one of our closest friends and allies, Japan.

We receive so much from countries such as the United States, Japan, and the Republic of China-Taiwan.  But we cannot just continue to be on the receiving end.  We also have to reciprocate in whatever manner we can.  We have to say, “Thank you!”

In the United Nations we use our vote to support the positions of the United States, Japan, and the Republic of China-Taiwan at every possible opportunity.  For instance, Palau’s voting coincidence with the United States on important resolutions in the 64th United Nations General Assembly is 100% on critical issues: twelve for twelve.  It is my position to stand hand-in-hand with our closest friends and allies.  My decision to permit the Uyghurs to resettle in Palau was but a small thing that Palau could do to thank our best friend and ally, the United States, for all it has done for Palau.

Our local economy is also starting to grow again.  This is progress and it is directly attributable to our tourism industry and nothing else.  Tourism has started to rebound.  The publicity that Palau has received over the last year as a result of its acceptance of the United States’ request to resettle the Uyghurs in Palau, the well-publicized declaration I made at last year’s United Nations General Assembly of Palau as a shark sanctuary, and the uptick in the world’s economy as a whole, have all contributed to growth in our tourism industry.

I am pleased to be able to stand before you today and announce that after two and one half years of month-on-month and year-on-year decline in the number of tourists coming to Palau—Palau suffered an eighteen percent decline from 2007 (88,000) to the end of 2009 (72,000), about 16,000 less tourists by the end of 2009 than before—Palau’s tourism industry is enjoying almost a six percent increase in tourism since the first of this year.

However, Palau’s economy is still struggling and you should not consider this recent increase in tourism as conclusive evidence that Palau is on the road to full recovery.  Our local revenues, the funds that the National Government uses to finance almost seventy percent of its budget, have ranged from $27 million in Fiscal Year 2000, $28 million in Fiscal Year 2003, with a jump to $36 million in Fiscal Year 2005 due to the construction of the Compact Road, to $37.7 million in Fiscal Year 2008, and $36.6 million in Fiscal Year 2009; averaging about $32 million per annum over the last 10 years. This year, for the first two quarters, our collections are on track with the conservative but accurate estimate we made last year when we were putting together this year’s budget.  However, they are generally down from the collections of local revenues Palau was enjoying in the middle of the last decade.

Our estimated revenues for Fiscal Year 2010 is $35,042,000.  As of the end of the second quarter, March 31, 2010, we have collected almost exactly fifty percent of that, or the sum of $17,494,289. Simply put, economic activity in Palau is still less than what it was and, in light of our growing population, less than what it will need to be in the future in order to sustain us. Our collections for 2009 and 2010 were increased as a result of the amnesty program that my administration initiated.

All of you need to understand and understand well that tourism is the principle private sector contributor to Palau’s Gross Domestic Product; fishing being the other significant private sector contributor.  Even so, the contributions of those sectors to our economy are not enough to sustain us.  They pale in comparison to the impact of the economic assistance Palau receives from the United States, Japan and Taiwan.

For instance, for each of the last two years Palau has received over $13 Million a year in direct economic assistance from the United States.  Cash money!  It is estimated that the multiplier effect of this cash infusion is directly responsible for a substantial amount of the economic activity in Palau.  It pays the salaries of our National Government employees, the doctors, the nurses, the teachers and the police.  It pays the local vendors who supply the National Government with goods and services.  The local vendors in turn pay their employees with the funds they receive from the National Government.  The government employees and the local vendors and their employees all pay taxes to the National Government and the cycle starts over again, around and around until the money leaves our economy and goes overseas to pay for the goods and services Palau imports from the outside. This means that without these grants of direct assistance, local revenues would be exponentially reduced.  And that is not even taking into consideration the inflation factor.

I am engaging in this narrative to illustrate several points.  First, it underscores the reason I have placed the Compact Review at the very top of my agenda and spent so much time on it over the first year of my Administration.  Without the direct economic assistance from the United States, the size of our National Government, in other words the hundreds of jobs so many of us rely upon; the educational, health and safety services that our community needs would have to be severely cut back and reduced.   The effect on our community would be disastrous!

The impact of the economic assistance extended to Palau by the United States is even greater than just the direct funds that Palau receives each year.  As you are all aware, under the Compact the United States also extends programmatic assistance to Palau.  In other words, Palau is eligible for grant funds for various activities, principally in the areas of education and health.  The latest statistics indicate that last year Palau received over $3.6 Million in grant funds that are directly responsible for paying the entire salaries of 222 National Government health care workers and teachers.  If that grant assistance were to vanish, those jobs and services would vanish along with it.

Second, it underscores the need for Palau to grow its private economy, something on which, regretfully, little progress has been made.  Unless we take action, and take action soon, to encourage foreign investment to Palau and to create jobs in the private sector so severely needed, the foundation of our economy will fail us.  We must send a strong message to potential investors that Palau welcomes and needs them.

Here lies my greatest regret of the first year of my Administration. The very first legislation I submitted to the Eighth Olbiil Era Kelulau for consideration was a measure designed to accomplish all of the foregoing.  On the first day of the first session of the Eighth Olbiil Era Kelulau I submitted the “Foreign Investment Act of 2009”.  It still has not been passed into law.

I made my intentions clear in my Inaugural Address when I emphasized the need for Palau to take immediate action to grow its private sector economy and my intention to at least partially accomplish that goal by vigorously courting foreign investors.  It is still my goal to make Palau a foreign investment friendly country. The “Foreign Investment Act of 2009” will accomplish that.

Time is short.  Palau is competing against the rest of the developing nations in our region for foreign investment and capital.  We must attract new capital into our economy by making Palau as investment friendly as quickly as possible.  Let us beat the competition.  Let us create an economy that is capable of providing here in Palau the jobs necessary to reverse the sad and troubling situation that has seen hundreds, if not thousands, of the sons and daughters of our soil leave Palau to seek opportunity elsewhere, perhaps never to return, because there are no jobs for them here, because the economy is stagnant and needs to be further developed.  Let us create an economy that gives our citizens the maximum opportunity to make the most of their own lives and to achieve their ambitions here in their homeland.

We were given a second change in our economic life when I convinced the United States to extend an additional and substantial amount of direct financial and programmatic assistance to Palau for the next 15 years. Unless we help ourselves by opening the doors for private investment in Palau, the future of our people will be at serious risk.

There is an old Chinese proverb that I am sure all of us have heard.  “Give a man a fish and you feed him for a day. Teach a man to fish and you feed him for a lifetime.”  The rationale behind the Compact of Free Association is for us not to continue to receive fish from the United States and others, but to learn and teach our people how to fish.

Senators and Delegates, our lands lay undeveloped, our human resources are leaving, our private economy is stagnant.  We have no other options.  Let us work together to develop our national economy, which is one of the mandates of our Constitution.  We have to create more private sector jobs and business opportunities.  By doing so, we will expand our tax base and enhance the National Government’s local tax revenues.

As I stated earlier, there are several areas where a great deal of progress has been made since I last reported to you.  I have spoken far too long today and your attention is undoubtedly wavering, but allow me to at least list, succinctly I assure you, some of the other initiatives my Administration has taken over the last year and the progress that has been achieved.

The declaration of Palau as a shark sanctuary.  This was done in recognition of the simple fact that the marine environment that surrounds us is our greatest asset and is the principal reason tourists come to Palau.  My declaration has, I firmly believe, helped to generate interest in Palau as a renowned tourist destination.

Hand in hand with the shark sanctuary, I have instituted and lead a Pacific wide initiative, the Organization of Tuna Exporting Countries or “OTEC”, to initiate a process to maximize the income Palau receives from the fishing that takes place in our waters.  Since the Compact came into effect, fishing has declined as a percentage of Palau’s Gross Domestic Product.  Hopefully my initiative will reverse that decline.  Palau must have more than one private sector industry and must receive its fair share from the exploitation of its resources.  I will introduce legislation in the not too distant future to change our current system of licensing foreign fishing vessels to a system that is not only more attractive to the foreign fishing industry, but also generates more revenue for Palau.

Hand-in-hand with our national communications company, Palau National Communications Corporation, my Administration has recently undertaken an initiative to secure an underwater fiber-optic cable to link Palau with the rest of the world.  In the course of the ongoing Compact Review I have prioritized this capital improvement projects, including the fiber optic cable, and the United States has agreed to set aside $40 Million of the proposed $250 Million package for capital improvements in general.  An opportunity has just recently arisen that may permit Palau to accomplish this fiber-optic CIP for as little as half the cost originally estimated and to do so by as soon as next year at this time.  I do not want to raise your expectations too high, as the opportunity may not pan out, but your National Government is trying hard to see that it does.  I am committed to bringing broadband Internet connectivity to Palau as soon as possible.  The future of our economic self-sufficiency also requires this CIP Project.

My Administration conducted an island-wide survey last year to try to determine the incomes of our islands’ households.  The results of the survey are available for all to review, but they disclose what I had already expected: that many of our people labor day-to-day just to buy the bare necessities and to feed themselves.  My previous request to the Olbiil Era Kelulau that it consider appropriating money to help the National Government—in partnership with State Governments—alleviate some of the burdens these families suffer under, was rejected.  However, I intend to re-introduce that request again in my Fiscal Year 2011 budget.  The low-income families of Palau, particularly those who live in the villages and work in the private sector, must be assisted.  They must be allowed to share in whatever economic success Palau experiences. I urge the Olbiil Era Kelulau to sympathetically consider the lot of these families.

School buses!  It was not long after I took office that I noticed the buses bringing school children from Babeldaob to Koror were old and decrepit.  The program of busing students to Koror that was initiated by my predecessors was being undermined by frequent breakdowns and, frankly, dangerously old equipment.  I am proud to announce that my Administration promptly identified the problem and has purchased three new buses to replace the old ones.  Those buses are up and running and serving Babeldaob as I speak. We should never allow transportation of students to deprive them of the opportunity to advance their education. Our investment in the education of our students is my Administration’s highest priority.

Oil and gas exploration.  This is another controversial subject, albeit one that all of us know is necessary to explore in order to provide for future generations.  In the past our leaders have given lip service to this issue, but dithered and delayed in doing anything about it.  My Administration has prioritized the issue and will follow through to see that exploration takes place in the near future.  If nothing is discovered, so be it.  But we need to find out if a resource is there and if so, we need to develop and exploit it in a responsible manner to provide for our future generations of Palauans.  The time to talk about it has come and gone.  It is time to do something about it.

Capital improvement projects.  My Administration has prioritized the construction of the so-called Kokusai Road, the road linking the Compact roads from Kiukl to Despedall of Babeldaob.  Construction of this project is proceeding as I speak.  And before the end of this year we will hold ribbon cutting ceremonies for the improvement of the Melekeok pubic road, Ngerechlong public road and water tank, Ngeremlengui Bridge over the Ngermeskang River and the Ngiwal Imekang Commercial Dock. Thank you again, Maggie Tien!

I am now in the process of launching a major agriculture development project known as “green revolution” to cultivate food crops to ensure food security for our people and promote local agricultural industry. At the same time I have initiated the expansion of “bul” nation-wide by establishing marine sanctuaries all over Palau to conserve and promote sustainable exploitation of our marine resources for the benefit of our people. These projects are being promoted in partnership with our ally, the Republic of China-Taiwan. Again, thank you, Republic of China-Taiwan!

There are also several lesser CIP Projects that my administration is working on with the Palau Civic Action Team. Thank you United States of America!

On public health, progress there is also being made.  It is the policy of my Administration to promote preventive health measures as an instrument of nation building and economic advancement. Consistent with this policy, my Administration is undertaking measures to promote a healthy lifestyle to eliminate the burden of chronic illnesses. The strength of our Nation depends on the health of its citizens.  To digress, I want to you to note that the moneys flowing to Palau under the Compact’s new economic package will be primarily directed to the promotion of the education, health and the public safety of our people.

I could go on for hours, but I will stop here.  Suffice it to say, my Administration is working hard for you so that when my successor takes office, he or she will have a firm economic foundation on which to build his or her priorities to raise the living standards of our people, which is our primary responsibility under the Palau Constitution.

I have tried today to give you a snapshot of the progress of my Administration, highlighting the most important aspects.  Yes, there are challenges and problems that lie ahead, but progress has been and is being made and together we can overcome.

Our further progress requires the cooperation and understanding of the Olbiil Era Kelulau.  There is no greater satisfaction for us, the elected public officials of Palau, than to be able to advance and raise the living standards of our people.  I am optimistic for our future and I know you are too.  With your support I can see a brighter future ahead.  With the conclusion of the Compact Review, we will have emerged from the dark before the dawn. Indeed, the sun is rising over the horizon and morning of promise has broken in Palau.

May God Bless all of you, and may God Bless the Republic of Palau.  Thank you!

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