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The president of Palau has pledged to maintain recognition of Taiwan, but warned that small countries needed to demonstrate the economic benefits of standing by Taipei as China increases pressure on its few remaining allies.
Surangel Whipps Jr, speaking at the Lowy Institute in Sydney earlier this month, said that he would not change his country’s position during his four-year term, citing Taipei’s assistance during the Covid-19 pandemic and the economic partnership between the countries.
“I believe in the principle that when you’re married, you’re married ‘til death do us part’,” he said.
But in an interview with the Financial Times, Whipps added that leaders needed to justify that decision by demonstrating the economic value of their diplomatic partnerships to their citizens.
“You’ve got to grow the economy and you’ve got to build economic resilience,” he said, adding that maintaining diplomatic ties “comes down to jobs, opportunities, livelihoods”.
“We need to prove that we’ve done the right decision,” he added.
Palau, a microstate of just 18,000 residents, is one of only 12 countries that recognise Taiwan, which China claims sovereignty over and has threatened to take over by force if Taipei resists indefinitely.
The Pacific has been the arena of a power contest in recent years as China, the US, Australia and New Zealand have vied for influence in the strategic region through pledges of investment and trade relationships with small island nations.
A number of Pacific countries have also switched their diplomatic allegiance to China, including Kiribati, the Solomon Islands and Nauru.
Whipps, who was re-elected in November, defeating his brother-in-law in a general election, said that Palau had also come under pressure in recent years. “We do know China has one goal, and that is for us to renounce Taiwan,” he said.
Palau is closely aligned with the US, and is one of the three island nations — along with the Marshall Islands and the Federated States of Micronesia — that are signatories to the Compact of Free Association, which gives its citizens the right to live and work in the US.
In return, the US stations military forces in Palau and provides substantial funding. Last year, Washington agreed to an $889mn economic support programme for Palau over 20 years.
Palau was one of the few countries to avoid President Donald Trump’s sweeping “reciprocal” tariffs — Whipps noted that “unfortunately” it had no exports to the US.
But it has been hit by the administration’s decision to dismantle the US Agency for International Development, which had supported disaster readiness, illegal fishing and cyber resilience programmes.
Whipps struck a sympathetic tone, however, on Washington’s decision to freeze foreign aid, saying recipient countries needed to be accountable for spending US funds.
“I understand the need to check,” he said.
He expressed confidence that US funding would return, however, pointing to the resumption of some projects, such as landmine removal and a tender to replace Chinese equipment, including a core network built by Huawei, from the country’s mobile network, which had initially been disrupted by the funding freeze.
Telecom networks have become a particular point of friction in the Pacific. Countries including the US and Australia have expressed concerns over the widespread installation of low-cost Chinese equipment across the region.
Whipps said “clean networks” in Palau were clearly of strategic interest to Washington, given the presence of US troops.
“We know in Palau that everything that I probably put on my phone, China reads — that’s just the way it is,” he said. “That’s why it’s got to be ripped out and replaced.”
