    [House Hearing, 119 Congress]
    [From the U.S. Government Publishing Office]

                       EXAMINING THE OFFICE OF INSULAR AF-
                        FAIRS' ROLE IN FOSTERING PROSPERITY
                         IN THE PACIFIC TERRITORIES AND
                          ADDRESSING EXTERNAL THREATS
                             TO PEACE AND SECURITY

    =======================================================================

                               OVERSIGHT HEARING

                                   BEFORE THE

                   SUBCOMMITTEE ON INDIAN AND INSULAR AFFAIRS

                                     OF THE

                         COMMITTEE ON NATURAL RESOURCES
                         U.S. HOUSE OF REPRESENTATIVES

                        ONE HUNDRED NINETEENTH CONGRESS

                                 FIRST SESSION

                                   __________

                            Wednesday, March 5, 2025

                                   __________

                               Serial No. 119-12

                                   __________

           Printed for the use of the Committee on Natural Resources

    [GRAPHIC NOT AVAILABLE IN TIFF FORMAT]

            Available via the World Wide Web: http://www.govinfo.gov
                                       or
              Committee address: http://naturalresources.house.gov

                                  __________

                       U.S. GOVERNMENT PUBLISHING OFFICE
    59-555 PDF                  WASHINGTON : 2025

    -----------------------------------------------------------------------------------

                         COMMITTEE ON NATURAL RESOURCES

                          BRUCE WESTERMAN, AR, Chairman
    		  ROBERT J. WITTMAN, VA, Vice Chairman
                        JARED HUFFMAN, CA, Ranking Member

    Robert J. Wittman, VA,			Raul M. Grijalva, AZ,
    Tom McClintock, CA			Joe Neguse, CO
    Paul A. Gosar, AZ			Teresa Leger Fernandez, NM
    Aumua Amata C. Radewagen, AS		Melanie Stansbury, NM
    Doug LaMalfa, CA			Val Hoyle, OR
    Daniel Webster, FL			Seth Magaziner, RI
    Russ Fulcher, ID			Jared Golden, ME
    Pete Stauber, MN			Dave Min, CA
    Tom Tiffany, WI				Maxine Dexter, OR
    Lauren Boebert, CO			Pablo Jose Hernandez, PR
    Cliff Bentz, OR				Emily Randall, WA
    Jen Kiggans, VA				Yassamin Ansari, AZ
    Wesley P. Hunt, TX			Sarah Elfreth, MD
    Mike Collins, GA			Adam Gray, CA
    Harriet M. Hageman, WY			Luz Rivas, CA
    Mark Amodei, NV				Nydia Velazquez, NY
    Tim Walberg, MI				Debbie Dingell, MI
    Mike Ezell, MS				Darren Soto, FL
    Celest Maloy, Utah			Julia Brownley, CA
    Addison McDowell, NC
    Jeff Crank, CO
    Nick Begich, AK
    Jeff Hurd, CO
    Mike Kennedy, UT

                    Vivian Moeglein, Staff Director
                      William David, Chief Counsel
                   Ana Unruh Cohen, Democratic Staff Director

                       http://naturalresources.house.gov
                                     ------

                   SUBCOMMITTEE ON INDIAN AND INSULAR AFFAIRS

                              JEFF HURD, CO, Chair

                    AUMUA AMATA C. RADEWAGEN, AS, Vice Chair

                   TERESA LEGER FERNANDEZ, NM, Ranking Member

    Aumua Amata C. Radewagen, AS         Nydia M. Velazquez, NY
    Doug LaMalfa, CA                     Val T. Hoyle, OR
    Tim Walberg, MI                      Pablo Jose Hernandez, PR
    Addison McDowell, NC                 Emily Randall, WA
    Mike Kennedy, UT                     Jared Huffman, CA, ex officio
    Bruce Westerman, AR, ex officio

                                  -----------

                                    CONTENTS

                                  ----------
                                                                       Page

    Hearing Memo.....................................................     v
    Hearing held on Wednesday, March 5, 2025.........................     1

    Statement of Members:

        Hurd, Hon. Jeff, a Representative in Congress from the State
          of Colorado................................................     1
        Leger Fernandez, Hon. Teresa, a Representative in Congress
          from the State of New Mexico...............................     3
        Huffman, Hon. Jared, a Representative in Congress from the
          State of California........................................     4

    Statement of Witnesses:

        Cheng, Dean, Senior Fellow, Potomac Institute for Policy
          Studies, Arlington, Virginia...............................     6
            Prepared statement of....................................     7
            Questions submitted for the record.......................    12
        Klingner, Bruce, Senior Research Fellow, The Heritage
          Foundation, Washington, D.C................................    14
            Prepared statement of....................................    16
            Questions submitted for the record.......................    21
        Bencosme, Francisco, Former China Policy Lead, U.S. Agency
          for International Development, Washington, D.C.............    24
            Prepared statement of....................................    25
            Questions submitted for the record.......................    33
        Paskal, Cleo, Non-Resident Senior Fellow, Foundation for
          Defense of Democracies, Washington, D.C....................    34
            Prepared statement of....................................    36
            Questions submitted for the record.......................    49

    Additional Materials Submitted for the Record:

        Submissions for the Record by Representative King-Hinds
            Commonwealth of the Northern Mariana Islands, Office of
              the
              Governor, Letter.......................................    70
            Commonwealth of the Northern Mariana Islands, Office of
              the
              Governor, Letter.......................................    78
        Prepared Statement of Governor Arnold I. Palacios of the
          Commonwealth of the Northern Mariana Islands...............    81

    [GRAPHIC] [TIFF OMITTED] T9999.001

    To:        House Committee on Natural Resources Republican Members

    From:     Indian and Insular Affairs Subcommittee staff, Ken
            Degenfelder (Ken.Degenfelder@mail.house.gov), Justin Rhee
            (Justin.Rhee@mail. house.gov), and Ransom Fox (Ransom.Fox@mail.
            house.gov), x6-9725

    Date:     March 3, 2025

    Subject:   Oversight Hearing titled ``Examining the Office of Insular
            Affairs' Role in Fostering Prosperity in the Pacific
            Territories and Addressing External Threats to Peace and
            Security''
    ________________________________________________________________________
            _______

        The Subcommittee on Indian and Insular Affairs will hold an
    oversight hearing titled ``Examining the Office of Insular Affairs'
    Role in Fostering Prosperity in the Pacific Territories and Addressing
    External Threats to Peace and Security'' on Wednesday, March 5, 2025,
    at 10 a.m. in 1324 Longworth House Office Building.
        Member offices are requested to notify Haig Kadian
    (Haig.Kadian@mail.house.gov) by 4:30 p.m. on Tuesday, March 4, 2025, if
    their member intends to participate in the hearing.
    I. KEY MESSAGES

         As part of the U.S. homeland, the U.S. Pacific territories
                of American Samoa, Guam, and the Commonwealth of the
                Northern Marianas Islands are on the frontlines against
                attempts by the People's Republic of China (PRC) and the
                Democratic People's Republic of Korea (DPRK) to undermine
                U.S. leadership and interests in the Indo-Pacific.

         The activities of the PRC under the rule of the Chinese
                Communist Party (CCP) and the DPRK threaten U.S. national
                security, particularly in the U.S. Pacific territories.

         It is imperative that the Department of the Interior's
                (DOI) Office of Insular Affairs (OIA), the office charged
                with managing federal relations with the territories, work
                with the territories to address threats within its
                jurisdiction.

         It is critically important for national security that the
                U.S. government counter these activities of the PRC and the
                DPRK in the U.S. Pacific territories. Relevant federal
                agencies must coordinate to ensure the U.S. effectively
                counters these maligned activities.

         The OIA should work with Congress to find opportunities to
                improve economic prosperity in the Pacific territories to
                meet U.S. interests in a fiscally responsible manner.

    II. WITNESSES

         Mr. Dean Cheng, Senior Fellow, Potomac Institute for
                Policy Studies, Arlington, VA

         Mr. Bruce Klingner, Senior Research Fellow, The Heritage
                Foundation, Washington, D.C.

         Ms. Cleo Paskal, Non-Resident Senior Fellow, Foundation
                for Defense of Democracies, Washington, D.C.
         Mr. Francisco Bencosme, Former China Policy Lead, U.S.
                Agency for International Development, Washington, D.C.
                [Minority Witness]

    III. BACKGROUND

        The U.S. has a historical presence in the Indo-Pacific as well as
    ongoing commitments and interests that are paramount to preserving a
    free and open Indo-Pacific. However, American geopolitical equities in
    the Indo-Pacific are being challenged through malign activities by
    adversaries of the U.S., namely the PRC under the rule of the CCP, and
    the DPRK, commonly known as North Korea. These adversaries actively
    seek to disrupt, dismantle, and displace U.S. leadership in the region.
        The U.S. maintains Compact of Free Association (COFA) agreements
    with three sovereign Pacific Island countries, known as the Freely
    Associated States (FAS): the Federated States of Micronesia (FSM), the
    Republic of the Marshall Islands (RMI), and the Republic of Palau. The
    COFA agreements form the foundation of our relationship with each FAS,
    establishing mutually beneficial arrangements where the U.S. offers
    economic assistance and security guarantees in exchange for exclusive
    security rights.
        In addition to the COFA agreements, the U.S. is geographically part
    of the Indo-Pacific through the state of Hawaii and three territories:
    American Samoa, the Commonwealth of the Northern Mariana Islands
    (CNMI), and Guam. The Pacific territories are critical to the U.S.
    national security strategic posture in the region and have high U.S.
    military enlistment rates.
        The DOI, through the OIA, administers, monitors, and manages
    federal relations with the U.S. territories in accordance with
    applicable law.1 It has the same responsibility for the
    economic assistance and federal programs for the FAS under the COFA
    agreements.2
        The OIA plays a leading role in supporting the economic health of
    the territories within its jurisdiction by administering grant programs
    benefiting the territories. As the Pacific territories rely heavily on
    U.S. federal assistance, the fiscal impact of OIA grant programs cannot
    be overstated. For example, in fiscal year 2024, federal funding
    represented approximately 34.6 percent of the budget for 28 of Guam's
    local agencies.3
        Fostering prosperity in the territories enables them to become more
    self-sufficient and equips them with the resources they need to resist
    the maligned activities of the PRC and the DPRK in their communities.
    The PRC, in particular, targets economically weak communities to
    attempt to coerce local political and business elites. Fostering
    prosperity in the territories improves resilience against these
    threats.
        Additionally, the OIA plays a leading role in advocating for the
    Pacific territories within the federal government. OIA is the primary
    office working with the territories and relevant agencies such as the
    Departments of Defense and Homeland Security to seek solutions to the
    threats they face.
    U.S. Territories in the Pacific
        American Samoa: American Samoa is an unincorporated territory of
    the United States comprising islands of the eastern Samoan archipelago.
    American Samoa is in the Polynesian region of the south-central Pacific
    Ocean. It includes the six eastern Samoan islands of Tutuila, Tau,
    Olosega, Ofu, Aunuu, the Swains Island, and the uninhabited Rose Atoll.
    The capital is Pago Pago, on Tutuila, which is the main port and
    commercial center of American Samoa. The elected and traditional
    leaders seek to preserve a customary way of life as ``nationals but not
    citizens,'' which is reflected in their allegiance to the U.S., strong
    patriotism and a high rate of U.S. military service.4
    [GRAPHIC] [TIFF OMITTED] T9555.005

        Commonwealth of the Northern Mariana Islands (CNMI): The CNMI
    is an unincorporated territory of the United States composed of 14
    islands and islets in the western Pacific Ocean, 100 miles north of
    Guam. The Mariana Islands are a chain of volcanic mountain peaks and
    uplifted coral reefs. The principal inhabited islands in the CNMI are
    Saipan, Guguan, Tinian, and Rota. The northern, largely uninhabited
    islands include Farallon de Medinilla, Anatahan, Sariguan, Gudgeon,
    Alamagan, Pagan, Agrihan, Asuncion, Maug Islands, and Farallon de
    Pajaro.5
    [GRAPHIC] [TIFF OMITTED] T9555.006

        Guam: Guam is a U.S. territory in the northwest Pacific. It is
    the largest, most populous, and southernmost island of the Mariana
    Archipelago. It is governed under the Organic Act of Guam, passed by
    the U.S. Congress and approved by President Truman on August 1,
    1950.6 The development of Guam into an important home for
    U.S. military bases after World War II profoundly changed the island's
    agricultural patterns, and Guam now imports most of its
    food.7 Guam has a vibrant tourism sector, drawing visitors
    from many Asian nations, and a robust local and regionally
    interconnected economy, with commerce ties to the Philippines, South
    Korea, and Japan. Most of Guam's population, 170,000, are of native
    Chamorro heritage. Guam has been a part of the United States since the
    close of the Spanish-American War and today resembles the mainland
    United States in terms of language, business practices, and patriotic
    sentiments.8
    [GRAPHIC] [TIFF OMITTED] T9555.007

    Strategic Value of the U.S. Pacific Territories
        The Pacific territories have been a national security priority for
    the U.S. since WWII. The CNMI and Guam are along the Second Island
    Chain, and American Samoa is along the Third Island Chain. These island
    chains informally represent the lines of access and egress for economic
    and defense purposes between the PRC and the Indo-Pacific and, thereby,
    the continental U.S.
        In World War II, the Empire of Japan used the islands as a vital
    base and anchorage for its air and naval forces when launching attacks
    against the U.S. 9 Given the historical context, the U.S.
    has a particular interest in the region's security to prevent the FAS
    from ever again being used as a platform or controlled region to attack
    the U.S. or its allies.
        The U.S. holds military bases and installations in the Pacific
    territories that are in proximity to the PRC and the DPRK.
        In Guam, Andersen Air Force Base (AAFB) and its annexes are
    concentrated at the island's northern end. Naval Base Guam has
    facilities around the island, including a naval air station, a naval
    base with a ship repair yard, communication centers, and a military
    hospital. The U.S. officially opened Marine Corps Base Camp Blaz
    (MCBCB) on January 25, 2023, located directly south of
    AAFB.10 Naval Base Guam, AAFB, and MCBCB operate under the
    command and support of Joint Region Marianas.
        In the CNMI, the U.S. Air Force (USAF) is in the process of
    upgrading a World War II-era airfield, North Field, on the island of
    Tinian.11 The USAF is restoring the runway in North Field so
    that it can serve as a ``power projection platform.'' 12
        Additionally, the U.S. Coast Guard (USCG) holds an active presence
    in the region as USCG cutters and patrol boats tend to be better suited
    than U.S. Navy vessels for patrolling the waterways surrounding the
    U.S. Pacific territories.13 The USCG 14th District regularly
    performs maritime safety and security missions, prevents illegal
    unlicensed fishing, protects natural resources, and responds to
    emergencies in the region.14
    Hacking and Spying Attempts
        In May 2023, the United States National Security Agency (NSA), the
    Cybersecurity and Infrastructure Security Agency (CISA), and the
    Federal Bureau of Investigation (FBI), issued a joint Cybersecurity
    Advisory regarding a cluster of activity of interest associated with a
    PRC 15 state-sponsored cyber actor.16 The actor,
    also called ``Volt Typhoon,'' is a PRC-sponsored hacking group focused
    on espionage and information gathering.17 Volt Typhoon
    targeted critical infrastructure and used ``built-in network
    administration tools'' to evade detection and perform its
    objectives,18 allowing them to blend in with normal Windows
    systems and network activities to avoid endpoint detection while
    triggering response products that alert the host.19 Volt
    Typhoon also intentionally limited the amount of activity captured in
    default logging configurations to further reduce the likelihood of
    detection.20
        Volt Typhoon installed the evasive computer code in
    telecommunications systems in Guam and other areas in the United
    States. The activity in Guam is noteworthy because ``Guam, with its
    Pacific ports and vast American air base, would be a centerpiece of any
    American military response'' to an invasion or blockade of Taiwan or
    American assets in the Indo-Pacific region.21 The PRC's
    targeting of Guam takes increased importance given their ongoing
    efforts to gain influence over U.S. territories in the
    Pacific.22
        In November 2023, the DPRK launched what it claims is its first
    military spy satellite, which flew over and surveilled U.S. military
    installations in Guam.23 Kim Jong Un, the dictator of North
    Korea, personally inspected images taken of Guam and expressed interest
    in launching ``many more'' spy satellites to monitor U.S. troops in the
    region.24 The DPRK has since continued to monitor Guam and
    U.S. presence in the Pacific.25
        An area of concern particularly for the DOI is the high risk of
    espionage that comes with use of unmanned aerial systems (UAS),
    commonly known as drones, equipment or software manufactured or
    developed by PRC-linked companies. Companies based in or linked to the
    PRC are legally obligated under PRC domestic law to comply with the
    CCP.26 As the distinctions between private sector and
    government become blurred in the PRC, there is increasing potential for
    PRC-linked drones and UAS software being vectors for spying by the CCP.
        The DOI continues to include drones manufactured by Da-Jiang
    Innovations (DJI), a PRC company, in its UAS fleet.27 DJI
    has faced high scrutiny as research conducted by independent
    cybersecurity firms revealed that DJI drones had hidden coding that
    allowed for access and transmittal of sensitive data without user
    knowledge and consent.28 Another area of high concern is the
    DOI's list of approved UAS software including software developed by
    Autel Robotics.29 The Department of Defense recently listed
    Autel Robotics as a People's Liberation Army (PLA) affiliated
    entity.30
        It is alarming that the Biden administration continued to allow for
    drones produced by PRC-linked companies in U.S. government UAS fleets
    despite being aware of the national security concerns. Congress should
    work with the Trump administration to ensure these concerns are
    addressed and that they do not pose a threat to the U.S. homeland,
    including the Pacific territories.
    Missile Threats
        The DPRK and the PRC actively seek advanced missile capabilities
    that directly threaten the security of the U.S. homeland. The Pacific
    territories are particularly vulnerable to these threats, given their
    proximity to Beijing and Pyongyang. Guam, in particular, is seen as a
    high-value target for the DPRK and the PRC given its strategic
    importance for the U.S. 31
        Guam is within range of several of the PLA ballistic and nuclear-
    capable missile systems, including the Dongfeng-26 (DF-26) ballistic
    missile, which some PRC-based media reports have dubbed as the ``Guam
    killer'' missile.32 The PLA recently increased their DF-26
    ballistic missile stockpile with efforts to rapidly expand their
    arsenal to include 1,000 warheads by 2030.33 In 2020, the
    PLA Air Force released video footage of what appears to be a simulated
    attack on AAFB in Guam.34 The video depicts the PLA's
    nuclear-capable Xi'an H-6 bombers launching a missile on a runway that
    seemingly mirrors the layout of AAFB.
        Furthermore, the PRC conducted a test using a ``dummy''
    intercontinental ballistic missile (ICBM) warhead 35 that
    flew over the vicinity of the Pacific territories and into the Pacific
    Ocean in September 2024.36 ICBMs are a particular concern as
    these missiles are primarily designed to deliver nuclear warheads.
    There are also growing concerns regarding the PLA's newest missile
    project, the Dongfeng-27 (DF-27), which will include a ``hypersonic
    glide vehicle'' 37 that allows for the missile to ``evade
    being intercepted.'' 38 According to a leaked Pentagon
    report,39 the intended goal of the DF-27 is to ``penetrate
    U.S. ballistic missile defenses'' 40 and threaten the PLA's
    targets, such as the Pacific territories.41
        The DPRK's missile program also poses a significant threat to the
    Pacific territories, as they have tested medium-range, intermediate-
    range, and intercontinental ballistic missiles capable of striking the
    islands, including the Hwasong-12 ``Guam-killer'' ballistic
    missile.42 It appears that the Pacific territories are high-
    value targets for the DPRK as U.S. military activity at AAFB in August
    2017 triggered provocative threats from the DPRK.43 The DPRK
    has also claimed to have successfully developed a successor to the
    Hwasong-12, the Hwasong-16B, that includes a hypersonic glide
    vehicle.44
    IUU Fishing
        The PRC has increased its economic activity within the U.S.
    territories. In American Samoa, Guam, and CNMI, PRC Illegal,
    Unreported, and Unregulated (IUU) fishing has continued to impact the
    local economies as PRC fishing fleets illegally overfish within U.S.
    territorial waters.45 The PRC ``wants to access natural
    resources in the Pacific . . . [as] the South China Sea is practically
    devoid of fisheries, Chinese fishing trawlers have increasingly turned
    to far-flung locales to make up the difference, including off the
    coasts of American Samoa, CNMI, and Guam.'' 46
        IUU fishing by PRC fishing vessels has had a particular impact on
    the economy of American Samoa, as canned tuna exports account for
    approximately 99.5% of the total value of the island's exports, and the
    tuna industry provides 83.8% of American Samoa's private industry
    employment.47 IUU fishing activities have ``depleted tuna
    stocks within [American Samoa's] EEZ and disrupted the local economy,
    even to the point of forcing a tuna cannery there, which is one of the
    island's largest employers, to temporarily suspend operations due to
    lack of tuna availability.'' 48
        In 2024, the American Samoan government requested additional U.S.
    Coast Guard assistance in combatting IUU fishing as there are more than
    540 PRC-flagged vessels reportedly active in the water around American
    Samoa.49
    Vulnerabilities Posed by Tourism Loopholes in the CNMI
        Recently, there has been a rise in the number of PRC-nationals
    illegally entering into PRC nationals illegally entering Guam via the
    CNMI by taking advantage of a fourteen-day visa-waiver program that
    permits PRC nationals to enter the CNMI without first obtaining a
    tourist visa.50 The importance of this issue was highlighted
    by a recent bicameral congressional letter to then-Secretary of
    Homeland Security Mayorkas to bring awareness to this
    matter.51 Since 2022, there have been 118 reported attempts
    of PRC nationals illegally entering Guam.52 However, these
    are just the illegal entries that have been caught, as hundreds of PRC
    nationals were said to have entered Guam successfully without being
    caught in the span of a couple of months alone according to a September
    2023 report.53
        Several PRC nationals caught illegally entering Guam were
    identified as being potential security threats on federal
    watchlists.54 As of December 20, 2024, seven PRC nationals
    were arrested for illegally entering Guam during a U.S. Missile Defense
    Agency missile interception test where a new radar was
    deployed.55 Authorities confirmed that all seven ``Chinese
    nationals arrived on the same boat'' 56 from the
    CNMI.57 Even more concerning, at least four of the PRC
    nationals were found ``in the vicinity of a military
    installation''.58
        Furthermore, there is rising concern about the flow of fentanyl and
    other illicit drugs into the Pacific territories via PRC
    tourists.59 For example, two PRC nationals were caught
    illegally possessing ``over 50 grams of Methamphetamine with the intent
    to distribute'' 60 in the CNMI.61 As recently as
    this year, a PRC national ``came to Guam via boat''62 from
    Saipan and was arrested with the intent to sell Methamphetamine while
    possessing approximately 2,000 grams of the drug.63 One of
    the cooperating defendants in the case stated that there are Chinese
    nationals located in the CNMI and Guam who are running a ``drug
    distribution network'' 64 in the territories.65
        The Department of Homeland Security Secretary, Kristi Noem, has
    recently raised concerns over illegal entry into Guam by PRC nationals
    and emphasized the Trump administration's prioritization of securing
    U.S. borders and protecting the American people.66
        A related issue is the continued concern over ``birth tourism'' in
    the CNMI by PRC nationals, where tourists enter the CNMI for the reason
    of giving birth as a newborn will automatically obtain U.S.
    citizenship.67 Birth tourism continues to thrive in the CNMI
    as the first baby born in the CNMI in 2025 was from a PRC
    national.68
    OIA's Responsibilities
        As the office charged with managing federal relations with the
    territories, the OIA is a leading player in the overall economic health
    of the U.S. territories. The OIA must continue to engage with the
    Governments of American Samoa, CNMI, and Guam to ensure that threats
    are addressed within its jurisdiction while working with territorial
    governments to promote self-sufficiency.
        The OIA plays an important role in supporting the energy needs of
    the Pacific territories through the Energizing Insular Communities
    (EIC) program. This program, which received $15.5 million in fiscal
    year (FY) 2025, is intended to strengthen the foundations for economic
    development by addressing the energy needs of the
    territories.69 However, the Biden administration had
    repurposed this program to serve its political objectives by
    prioritizing funding for renewable energy projects and electric
    vehicles.70 The Biden administration's disastrous energy
    policies ignored the realities facing the territories and did little to
    help economic development in insular communities.71 The OIA
    must ensure the Energizing Insular Communities program supports an all-
    of-the-above energy approach.
        The Capital Improvement Project (CIP) grants administered by the
    OIA are also intended to promote economic development by addressing the
    territories' infrastructure needs.72 By supporting critical
    infrastructure projects, the OIA has an opportunity to foster growth in
    the territories. CIP grants should be prioritized for critical
    infrastructure projects and directly promote economic development in
    the territories.
        Furthermore, the OIA should increase coordination with agency
    partners and the U.S. Congress to ensure that the U.S. government is
    appropriately responding to attempts by the PRC and the DPRK to
    threaten peace and spread malign influence in the territories.
        The Interagency Group on Insular Areas (IGIA), organized annually
    by the OIA, is among the ways in which the OIA can facilitate
    interagency coordination.73 This annual meeting solicits
    information and advice from the elected leaders of the U.S. Insular
    Areas of Guam, American Samoa, the CNMI, and the U.S. Virgin Islands to
    make recommendations on the establishment or implementation of federal
    programs concerning the Insular Areas.74 In 2022, the IGIA
    convened to discuss key issues such as economic development, energy and
    infrastructure, and education.75 Agencies included in the
    2022 meeting were the Departments of the Interior, Energy, Commerce,
    Veterans Affairs, and others.76 While the Biden-Harris
    administration did not publicly release readouts for the 2023 and 2024
    meetings, these meetings were mainly focused on the administration's
    political priorities such as the Inflation Reduction Act and climate
    resilience.77 It is critical that the OIA raises the
    concerns and issues highlighted by the Pacific territory leaders with
    relevant agencies.
        The OIA is also charged with regularly consulting the CNMI
    government on matters affecting the relationship between the federal
    government and the CNMI. This consultation is known as ``Section 902
    consultations'' and is mandated under the CNMI's establishing
    Act.78 The objective of these consultations is to provide an
    avenue for high-level discussions on the issues of immigration, labor,
    and U.S. national security interests between the U.S. and the CNMI.
        The House Committee on Natural Resources will continue to exercise
    its oversight authority over the OIA to ensure the office is carrying
    out its responsibilities in the manner that Congress intended, that the
    OIA budget is fiscally responsible and that the office executes
    programs in a manner reflective of the interests of the American
    people. Critical to its purpose and role is ensuring the Pacific
    territories are strong partners in abating threats to peace and
    security in the Pacific and on the mainland.
    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

     OVERSIGHT HEARING ON EXAMINING THE OFFICE OF INSULAR AFFAIRS' ROLE IN
                      FOSTERING PROSPERITY IN THE PACIFIC
       TERRITORIES AND ADDRESSING EXTERNAL THREATS TO PEACE AND SECURITY

                                  ----------

                            Wednesday, March 5, 2025

                         U.S. House of Representatives

                   Subcommittee on Indian and Insular Affairs

                         Committee on Natural Resources

                                Washington, D.C.

                                  ----------

        The Subcommittee met, pursuant to notice, at 10:08 a.m. in
    Room 1324, Longworth House Office Building, Hon. Jeff Hurd
    [Chairman of the Subcommittee] presiding.
        Present: Representatives Hurd, Radewagen, LaMalfa, Walberg,
    Kennedy, Westerman; Leger Fernandez, Hoyle, Hernandez, and
    Huffman.
        Also present: Representatives King-Hinds, and Moylan.

        Mr. Hurd. The Subcommittee on Indian and Insular Affairs
    will come to order.
        Without objection, the Chair is authorized to declare a
    recess of the Subcommittee at any time.
        The Subcommittee is meeting today to hear testimony for an
    oversight hearing entitled, ``Examining the Office of Insular
    Affairs' Role in Fostering Prosperity in the Pacific
    Territories and Addressing External Threats to Peace and
    Security.''
        Under Committee Rule 4(f), any oral opening statements at
    hearings are limited to the Chairman and the Ranking Minority
    Member. I therefore ask unanimous consent that all other
    members' opening statements be made part of the hearing record
    if they are submitted in accordance with Committee Rule 3(o).
        Without objection, so ordered.
        I ask unanimous consent that the gentleman from Guam, Mr.
    Moylan, and the gentlewoman from the Commonwealth of the
    Northern Mariana Islands, Ms. King-Hinds, be allowed to sit and
    participate in today's hearing.
        Without objection, so ordered.
        I will now recognize myself for an opening statement.

     STATEMENT OF THE HON. JEFF HURD, A REPRESENTATIVE IN CONGRESS
                       FROM THE STATE OF COLORADO

        Mr. Hurd. Good morning. Today's hearing topic is
    particularly timely as our country faces ongoing threats
    seeking to end the American way of life. Our adversaries seek
    to subvert, dismantle and replace U.S. leadership, particularly
    in the Indo-Pacific region.
        The People's Republic of China, under the rule of the
    Chinese Communist Party, has waged political and information
    warfare in the Indo-Pacific in an attempt to coerce political
    and business officials and undermine U.S. interests.
    Furthermore, the PRC has posed a direct challenge to U.S.
    national security and strategic posture by rapidly developing
    weapons systems designed to threaten the United States. The PRC
    has been directly linked with cyber attacks against U.S.
    Government servers and the flow of illicit narcotics in our
    communities.
        The Democratic People's Republic of Korea, commonly known
    as North Korea, also seeks to undermine the U.S. and challenge
    U.S. leadership in the region. While having far fewer resources
    than the PRC, the threat that North Korea poses should not be
    underestimated. Under the dictatorship of Kim Jong Un, North
    Korea has become increasingly hostile to the U.S. and to its
    allies. Perceiving the U.S. as an existential threat, Kim Jong
    Un has pursued an aggressive nuclear weapon development program
    and cyber attack capabilities aimed at causing maximum harm to
    the United States.
        The Pacific territories of American Samoa, Guam, and the
    Northern Mariana Islands are on the front lines against these
    threats by the PRC and North Korea in the Indo-Pacific. From
    being in range of hypersonic and ballistic missiles to
    espionage attempts, the Pacific territories face an
    increasingly hostile geopolitical environment. As such, it is
    critical that the relevant agencies within the U.S. Federal
    Government work to address these threats.
        The Department of the Interior's Office of Insular Affairs,
    OIA, plays a key role in this endeavor, as the office charged
    with managing U.S. Federal relations with the insular areas.
    The OIA is among the primary avenues for the territories to
    find solutions to the threats they face with relevant Federal
    agencies.
        The OIA also plays a leading role in supporting the
    economic health of the territories within its jurisdiction by
    administering grant programs benefiting the territories. As the
    Pacific territories rely heavily on U.S. Federal assistance,
    the fiscal impact of OIA grant programs cannot be overstated.
    Fostering prosperity in the territories enables the territories
    to not only become more self-sufficient, but also equips the
    territories with the resources they need to push back against
    the activities of the PRC and North Korea in their communities.
        It is critical that the OIA increase coordination with
    agency partners and the U.S. Congress to ensure that the U.S.
    Government is appropriately responding to attempts by the PRC
    and North Korea to threaten peace and spread malign influence
    in the territories.
        As we proceed with today's discussion, I want to take this
    moment to make it clear that when we refer to threats from
    China and North Korea, we are referring to the Chinese
    Communist Party and the North Korean Government, respectively.
    We recognize and firmly believe in the distinction between the
    totalitarian regimes in Beijing and Pyongyang, and the Chinese
    people and North Korean people who long for democracy and
    freedom from autocratic rule. In many ways, this makes the PRC
    and North Korea an even greater threat, as their actions are
    not driven by national interests but by the nefarious desires
    of the ruling elites. Beijing and Pyongyang have made it
    abundantly clear that threatening the U.S. is their priority.
        I thank our witnesses for appearing before us today and
    look forward to their testimony.
        The Chair now recognizes the Ranking Minority Member for
    any statement.

             STATEMENT OF THE HON. TERESA LEGER FERNANDEZ,
            A REPRESENTATIVE IN CONGRESS FROM THE STATE OF
                               NEW MEXICO

        Ms. Leger Fernandez. Thank you, Mr. Chairman, and I am so
    very happy to be here again addressing issues in the blue
    continent with our Freely Associated States and the islands in
    the Pacific. And, you know, I love the fact that the Indian and
    Insular Affairs Subcommittee represents the people part of the
    Natural Resources Committee. And it was an incredible honor to
    visit the Freely Associated States and Guam last year when we
    were reviewing the COFA agreements, which were skillfully, I
    think, came to a conclusion and signed.
        And when we were engaged in that outreach, in those
    negotiations, in the visits, in the hearings, we heard over and
    over again about the threats that the People's Republic of
    China posed to our interests in the Freely Associated States
    and the Pacific territories. Through its Belt and Road
    Initiative, the PRC offers economic aid and infrastructure
    developments to shape political outcomes to improve
    perceptions. And they are doing this not because they are an
    incredibly generous organization, but we know that they want to
    destabilize the relationships between the United States and
    these, our most generous of allies.
        And that is why it is really frustrating, when we talk
    about the importance of pushing back against the PRC, to look
    at the destruction of USAID, to understand that in a tiny
    office, the Office of Insular Affairs, four people were fired.
    You cannot say we are going to take the threat of the PRC
    seriously and then destroy and eliminate and weaken the tools
    that we have to fight their nefarious influence.
        So when this wonderful trip, and I am so grateful for the
    Chairman, and hopefully, you will get to go on one because it
    was amazing, this trip that we did, and I met many of you
    through this whole process, we were there and they told us
    about that. They told us about the trawlers who were trying to
    just cut up the cables, right? We saw the buildings where there
    were big signs proclaiming China is building this for you,
    right?
        And when we then eliminate, without congressional
    authority, something like USAID, which was itself doing much
    more quiet projects like the cable to Palau that has now been
    frozen, we have now stopped. I don't know if you know this,
    Chairman. We have stopped the construction of a cable that
    would connect Palau underground, key infrastructure, and key
    infrastructure that is also useful to us.
        When you visit you will see our bases. You will see the way
    we depend on these to protect our airspace, to identify what is
    coming over. And it is so crucial to us here because these are
    the islands and these are our allies that are closest to China.
    And when we start destroying the tools, and the people, and
    undermining it, what are we doing?
        And let me talk about the people. The Medicaid cuts that
    are proposed in the budget resolution would hit these
    territories incredibly hard. In American Samoa, 76 percent of
    the population qualifies for Medicaid or CHIP. In the Northern
    Mariana Islands, 36 percent of residents are enrolled in
    Medicaid or CHIP. So when we start undermining the VA, when we
    start undermining Medicaid, and we are not going to get $880
    billion from fraud I mean anybody who repeats that knows it is
    not true. There is not that much fraud there.
        So it is going to affect people, and we are going to hope
    that we get three Republicans who stand with Democrats to say,
    with ``Do not do this'' for the many reasons, whether it is
    your own constituents, or recognizing that we must maintain
    positive relationships and we must maintain the warmth of the
    friendship and the warmth of the alliance that we have with the
    people of the territories and in the blue continent.
        I look forward to your testimony today in this oversight
    hearing.
        And Mr. Chairman, I yield back.
        Mr. Hurd. Thank you very much, Ranking Member Leger
    Fernandez. The Chair now recognizes the Ranking Member of
    the House Natural Resources Committee, Mr. Huffman, for any
    statement.
        Mr. Huffman.

       STATEMENT OF THE HON. JARED HUFFMAN, A REPRESENTATIVE IN
                 CONGRESS FROM THE STATE OF CALIFORNIA

        Mr. Huffman. Thank you, Mr. Chairman, and I know I am
    sometimes a skunk at the picnic at these hearings. I don't
    enjoy that. I wish it wasn't necessary. But I am going to start
    off with something very positive and consensus-based.
        This hearing is on a super-important subject, especially
    timely given the threats posed by the People's Republic of
    China and North Korea to U.S. territories and Freely Associated
    States in the Pacific. And I will go further, Mr. Chairman.
    Your opening remarks were spot on. You absolutely nailed it,
    including the nuance about the difference between these
    tyrannical regimes and the people that they represent. You
    really captured it.
        Everyone here says that we care a lot about these threats
    and these people. However, and here comes the skunk part, the
    Trump administration right now is actively undermining efforts
    to address these threats through a reckless, indiscriminate
    approach led by DOGE, people that have never spent 1 day in
    public service or government and have no idea what they are
    doing. They are taking a meat axe to the American workforce in
    a way that is crippling the very personnel needed to safeguard
    peace and security in the region.
        And, you know, we heard all of this fawning applause last
    night from the cult section of the House chamber when Elon Musk
    was introduced and whenever DOGE was mentioned. But you know
    who else is really cheering for DOGE right now, and Elon Musk?
    China and North Korea. They are thrilled, just as thrilled as
    the cult section was last night.
        The Office of Insular Affairs, which provides critical
    support to the U.S. Pacific Territories facing unique economic,
    environmental, and geopolitical challenges, and the USAID, as
    the Ranking Member mentioned, are facing substantial cuts in
    funding and personnel to finance tax breaks for billionaires.
        And we will hear our witnesses describe how the U.S.
    Pacific territories and Freely Associated States, because of
    their strategic significance, are prime targets for PRC
    influence operations ranging from propaganda and traditional
    espionage to more covert influence operations targeted at
    elites and public opinion.
        We will also hear how the PRC is undermining relations
    between the territories and the U.S. Federal Government to
    exert corrosive influence in the territories and render them
    less able to defend themselves, let alone American national
    security interests.
        But what we won't hear, I hope I am wrong, but what I think
    we won't hear today is Republicans from Congress standing up to
    what the Trump-Musk administration is doing right now to our
    national security interests, this dangerous, short-sighted
    attack on agencies that protect American interests and the U.S.
    territories from China and North Korea. The Trump
    administration has already fired more than 5,600 USAID
    employees and plans to eliminate a majority of U.S. development
    and humanitarian assistance abroad.
        USAID's humanitarian and development assistance underpins
    our close relationships with the Federated States of Micronesia
    and the Republic of the Marshall Islands under the Compact of
    Free Association Agreement, or COFA, which, benefiting
    communities and families across the Pacific Islands, also find
    quite important, quite existential. Under COFA, USAID leads
    U.S. disaster response efforts, and has invested nearly $100
    million in disaster relief and reconstruction since 2008. The
    PRC Government capitalizes on instability and natural disasters
    in this vulnerable region to make inroads, and the vacuum that
    will be left if USAID is allowed to be sacrificed by DOGE, will
    give China a prime opportunity to swoop in and expand its
    influence.
        If the Trump administration is truly serious about
    bolstering our Pacific territories and our Pacific island
    nations against Chinese threats and North Korean threats, they
    sure have a funny way of showing it, decapitating the one
    agency that projects American influence abroad through
    developmental assistance and soft power, which are our best
    tools for countering Chinese and North Korean encroachment
    across the Pacific. This is just a self-inflicted wound.
        So it is time for my Republican colleagues to stop fawning
    over Elon Musk and DOGE, and start walking the walk for the
    stuff that they say they care about, and start protecting U.S.
    interests.
        With that I yield back.

        Mr. Hurd. Thank you, Mr. Huffman. Now I will introduce the
    witnesses for our panel.
        The first is Mr. Dean Cheng, Senior Fellow at the Potomac
    Institute for Policy Studies in Arlington, Virginia; next is
    Mr. Bruce Klingner, Senior Research Fellow at the Heritage
    Foundation in Washington, D.C.; next is Mr. Francisco Bencosme,
    former China Policy Lead at USAID here in Washington, D.C.; and
    last is Ms. Cleo Paskal, Non-Resident Senior Fellow at the
    Foundation for Defense of Democracies in Washington, D.C.
        Welcome. Let me remind the witnesses that under Committee
    Rules they must limit their oral statements to 5 minutes, but
    their entire statement will appear in the hearing record.
        To begin your testimony, please press the ``talk'' button
    on the microphone.
        We do use timing lights. When you begin, the light will
    turn green. When you have 1 minute left, the light turns
    yellow. And at the end of 5 minutes, the light will turn red,
    and I will ask you then to please complete your statement.
        I will also allow all witnesses on the panel to testify
    before Member questioning.
        The Chairman now recognizes Mr. Dean Cheng for 5 minutes.
        Mr. Cheng.

     STATEMENT OF DEAN CHENG, SENIOR FELLOW, POTOMAC INSTITUTE FOR
                  POLICY STUDIES, ARLINGTON, VIRGINIA

        Mr. Cheng. Good morning, Chairperson Hurd, Ranking Member
    Fernandez, representatives. My name is Dean Cheng. I am a Non-
    Resident Senior Fellow with the Potomac Institute for Policy
    Studies. My comments this morning are my own. My comments this
    morning are intended to provide some context for better
    understanding of the Chinese interest in the Central Pacific
    and the threat posed therein.
        For the PRC and the United States, the importance of the
    Central Pacific region will only increase in the coming years.
    Taiwan and western Pacific tensions are only likely to rise.
    There is little sign of abatement. Growing PLA, People's
    Liberation Army, capabilities will make operating in the
    western Pacific within what is sometimes termed the first
    island chain, more difficult. And indeed, in the initial phase
    of any conflict, U.S. forces' ability to operate in that area
    is going to be extraordinarily challenging.
        American resets and greater focus will only further lead to
    the need for expanded infrastructure in the Central Pacific as
    a fallback position for U.S. security operations and efforts.
    Here it is notable the Chinese competition with the United
    States is going to intensify because, in part, China has
    significant resources. The PRC has the ability to undertake not
    simply whole-of-government, but a whole-of-society efforts, and
    therefore U.S. dominance in the region is going to be
    challenged.
        China has a variety of tools at its disposal. Its foremost
    set of tools are, in fact, not necessarily military, but
    economic. These include aid, where China is the second-largest
    donor to the region after Australia; investments, as reflected
    recently in the Cook Islands, these often include tourism, deep
    sea mineral exploration, and shipbuilding, China has also
    indicated to Fiji that it intends to invest in that nation's
    port facilities and shipyards; security assistance. We are
    fortunate at this time that China is not yet a major source of
    arms to the region, but that is only for the moment. It is,
    however, employing an interesting form of legal warfare by
    providing significant police training to nations such as the
    Solomon Islands and Fiji.
        But above all the Chinese military, the PLA is increasingly
    able to present a very daunting portfolio of capabilities
    throughout the Pacific west of Hawaii, and here it is important
    to note that the U.S. cannot afford to rely only on the island
    of Guam, if only because there is only so much physical space
    there, and also because of the need, if one intends to operate
    in the face of these growing Chinese military capabilities, to
    have a wider dispersal and resilience in terms of our
    capabilities.
        A very brief survey of the kinds of growing capabilities
    that the PLA possesses begins with the Chinese navy, the PLA
    navy. It is now the world's largest fleet. It has 140 major
    surface combatants among its 370 ships. It has an increasingly
    growing range. This past week we have watched the PLA navy
    conduct live fire exercises in the Tasman Sea, separating
    Australia from New Zealand to such an extent that Australia had
    to issue a warning to airliners traversing the region.
        Notably, the Tasman Sea is actually farther away from
    Chinese naval bases than Guam is, reflecting the reality that
    the Chinese will be able to operate in the Central Pacific, in
    the waters around Guam, should it choose to do so.
        The Chinese navy will be operating under increasingly the
    cover of the PLA air force, which also has an expanding range.
    This has benefited from the addition of significant aerial
    refueling capability. The Chinese have also demonstrated the
    ability now to launch not only cruise missiles, but ballistic
    missiles from some of its types of bombers. And as worrisome,
    the PLA air force is now fielding the kinds of electronic
    support aircraft, airborne early warning and airborne command
    posts, that used to be primarily the purview of the United
    States. This reflects a recognition by the PLA that modern
    warfare is not simply about shooting, but it is about finding
    and countering an adversary's command and control.
        Above all, the PLA relies upon its rocket force, the PLA
    Rocket Force, and on long range missiles, ballistic and cruise,
    for a long-range precision strike. In this regard we see the
    Chinese fielding a growing set of capabilities, including the
    DF-26 intermediate range ballistic missile, in fact replacing
    the previous shorter range DF-21. Both of these have carrier
    killer capabilities. The DF-26 apparently is specifically
    intended to range Guam; the DF-17 hypersonic glide vehicle and
    the DF-27 IRBM, which has a hypersonic glide vehicle option,
    again intended to be aimed at Guam.
        With regards to considerations for long-term responses,
    then, it is essential that U.S. facilities in the western
    Pacific be more hardened as well as more dispersed. It is also,
    however, useful to recognize that while U.S. and Western
    governments typically do not build infrastructure, corporations
    do, and that with the issue of, for example, cable building,
    Google has been building cable networks across the Central
    Pacific, which does add to resilience.
        My appreciation to the Committee and the Subcommittee for
    the opportunity to be here this morning.

        [The prepared statement of Mr. Cheng follows:]
            Prepared Statement of Dean Cheng, Non-Resident Fellow,
                      Potomac Institute for Policy Studies

        My name is Dean Cheng. I am a non-resident fellow with the Potomac
    Institute for Policy Studies. The views I express in this testimony are
    my own, and should not be construed as representing any official
    position of the Potomac Institute for Policy Studies.
    China's Strategic Interest in the Central Pacific
        The People's Republic of China (PRC) has a growing strategic
    interest in the central Pacific region. This is partly rooted in the
    fundamentals of geography: an adversary will likely transit the central
    Pacific, if coming from the east, in order to strike at the PRC. That
    same adversary, even if relying on existing facilities closer to the
    Chinese littoral, will nonetheless have to rely on sea and air lines of
    communications that traverse the central Pacific in order to bring
    reinforcements and provide logistical support. Similarly, there are an
    array of undersea cables and space support facilities in this region
    that help sustain the flow of information across the Pacific. If the
    PRC is going to dominate the western Pacific, or seek to secure targets
    including Taiwan and the South China Sea, then it will likely strive to
    influence the central Pacific in order to strategically isolate those
    targets to limit interference and intervention.
        One of the most important tools available to the Chinese Communist
    Party (CCP) leadership is the Chinese military, embodied in the Chinese
    People's Liberation Army (PLA). The PLA's approach to warfare is
    embodied in the strategy of the ``active defense (jiji fangyu).'' This
    concept embodies the view that the PRC will be strategically defensive,
    not overtly commencing a conflict but only responding with force to
    outside aggression, while maintaining an operationally and tactically
    offensive stance.
        In December 2004, Hu Jintao, in his role as chairman of the Central
    Military Commission, gave a major speech wherein he charged the PLA
    with a set of ``historic missions for the new phase of the new
    century,'' commonly referred to as the ``new historic missions.''
    1 The speech provided guidance for the kinds of tasks and
    eventualities the PLA might be expected to apply the strategy of the
    active defense, i.e., what kind of wars it should be preparing for,
    given changes in the international strategic context, national
    development, and broader technological evolution.
        One of the new historic missions that Hu charged to the PLA was to
    ``provide strong strategic support for maintaining the nation's
    interests.'' While those interests center on issues of territorial
    integrity and national sovereignty, they now also extend to the
    maritime domain, outer space, and the electromagnetic spectrum and the
    information domain.2
        For the PRC, the maritime domain has gained an unprecedented
    importance. For most of its millennia long history, China has been a
    classical ``continental'' power, mainly focused on land power. China's
    foremost threats were typically from the steppe people to the north.
    Indeed, China has only been conquered by invaders from the north, such
    as the Mongols and the Manchus. While the Ming dynasty developed a
    substantial maritime capacity, as reflected in the ``treasure fleets''
    of Admiral Zheng He, imperial China never became dependent upon the
    seas. The low priority accorded maritime power at the time is
    symbolized in the eventual dissolution of those same fleets, along with
    the destruction of the associated shipyards and blueprints.3
        By contrast today's PRC depends on the world's sea lanes to move
    energy, raw materials, and food to keep the nation running, and to
    transport its finished products to markets around the world. The PRC is
    now as much a maritime power as it is a continental one. A review of
    the growth of the PLAN's capabilities over the last thirty years
    reflects this growing emphasis on maritime power. At the time of the
    end of the Cold War, China's navy had some 20 destroyers, and hundreds
    of motor torpedo boats, only slightly more advanced than those that
    fought in the Solomon Islands during World War II.4 Today's
    PLAN boasts three aircraft carriers, six cruisers, over thirty
    destroyers comparable to the USS Arleigh Burke-class (the most advanced
    destroyers in the US inventory), as well as over three dozen
    frigates.5
        Moreover, while China's navy was long a ``brown water navy,'' a
    primarily coastal defense force mainly operating very close to China's
    own shores, it has now become a ``blue water navy'' operating much
    farther afield. Indeed, in the 21st century the PLAN has been operating
    in what the Chinese term ``the far seas.'' Chinese naval forces have
    conducted exercises with the Russians in the Mediterranean and Baltic
    Seas.6 A Chinese naval task force has maintained a presence
    in the Gulf of Aden since 2008.7 In 2025, Chinese naval
    forces conducted live fire exercises in the Tasman Sea near Australia
    and New Zealand, some 5300 miles from southern Chinese naval
    facilities.8 This is even farther from Chinese shores than
    Guam (2300 miles).
        For the PLA, the outer space domain has also become a likely arena
    for future conflict. In the PLA's view, the American way of war is
    heavily dependent upon space. In the first Gulf War, Operation Desert
    Shield/Desert Storm for example, Chinese assessments note that the U.S.
    brought some 70 satellites to bear against Iraq. By PLA estimates,
    these satellites provided the U.S. with about 90 percent of its
    strategic intelligence and a substantial portion of its targeting
    information. Space systems also carried about 70 percent of all
    transmitted data for allied forces.9 The ability to exploit
    space is seen as a major contributing factor to the Coalition's
    victory.10
        That reliance has only grown in the intervening three and a half
    decades. Meteorological data, communications, intelligence gathering
    including imaging and signals intelligence, as well as weapons guidance
    have all involved space systems. Many UAVs require guidance from ground
    stations, linked by communications satellites, with positioning and
    navigational data provided by PNT satellites.
        Meanwhile, political warfare efforts, including efforts at
    effecting deterrence, imposing psychological pressure, and influencing
    global audiences also increasingly involve information and images
    derived from space systems. As the United States sought to dissuade
    Russia from invading Ukraine, images from Maxar were circulated
    globally to demonstrate that Russia was indeed planning to
    invade.11 The impact of satellite images can be significant.
    One Western analysis suggested that ``news audiences can often ascribe
    a greater sense of authority and objectivity to satellite images than
    other kinds of photos.'' 12
        From the PRC perspective, the ability to successfully conduct
    modern wars requires the establishment of space dominance, both to
    guarantee freedom of action for the PLA while denying that to an
    adversary. To this end, the PLA has sought to develop its own space
    support capacity, as well as an array of capabilities to deny
    adversaries the ability to freely exploit space.
        For the PLA, space information support operations (kongjian xinxi
    zhiyuan zuozhan) are defined as ``the use of space information
    collection and transmission systems, space navigation systems, to
    provide land, sea, and air combat power with reconnaissance and
    surveillance, missile early warning, communications, navigation and
    positioning, weather, geodetic surveying,'' and other such information
    support.13 The PRC fields satellite constellations that can
    support all of these tasks.
        The PRC has also been developing a variety of counter-space
    capabilities. These include both ground-based and co-orbital anti-
    satellite hard-kill systems, as well as electronic warfare jamming
    systems and cyber attack methods capable of interfering with normal
    satellite operations (commonly referred to as ``soft kill''
    systems).14
        While these systems would target adversary military systems, the
    Ukraine war has demonstrated not only the growing importance of space
    in modern conflict, but that commercial space companies will play an
    increasingly prominent role as well. Maxar and PlanetLabs are only two
    companies that have provided a wealth of images to think-tanks and
    media organizations striving to analyze and report on the war.
    Meanwhile, SpaceX's Starlink satellite Internet constellation has
    played a major role in supporting Ukrainian military operations.
    Consequently, the PLA must also consider the demands of countering
    commercial as well as governmental systems.
        These various capabilities demonstrate the intimate linkage between
    the outer space and the broader information domain. Chinese military
    writings in 2001 already noted that, besides the physical elements of
    soldiers and weapons, combat power would be increasingly generated
    through both greater access to information and information exploitation
    to link together forces.15 Modern warfare would require
    information power.
        Indeed, establishing space dominance is one aspect of the larger
    effort to establish ``information dominance (zhi xinxi quan),'' the
    ability to establish control of information and information flow at a
    particular time and within a particular space.16 It entails
    the ability to collect more information, manage it faster, and employ
    it more precisely than the adversary.17
        The side that enjoys information dominance will be better able to
    seize and retain the initiative, and force the adversary into a
    reactive mode, losing the ability to influence the outcome of an
    engagement. This exploits a key difference between mechanized warfare
    of the Industrial Age, and informationized warfare of the Information
    Age. ``Mechanized warfare focuses on physically and materially
    destroying an opponent, whereas informationized warfare focuses on
    inducing the collapse of the opponent's psychology and will.''
    18
        Information dominance is not only achieved through space
    activities, but also by interfering with an adversary's information
    infrastructure. This includes attacks against submarine cables, many of
    which transit the central Pacific. Palau, for example, has reported on
    repeated Chinese presence near submarine cables in its
    waters.19 Given alleged Chinese cable-cutting in the Taiwan
    Straits area, the threat to central Pacific cables is likely
    growing.20
        To generate and sustain this information power, the PLA has
    undertaken repeated overhauls of its organization to better conduct
    information operations. These efforts saw, in 2024, the dissolution of
    the relatively new PLA Strategic Support Force, and its replacement
    with the Military Aerospace Force, the Information Support Force, and
    the Cyber/Network Space Force.
    Potential Chinese Efforts Against Central Pacific Territories and
            States
        In light of the PRC's strategic interest in denying the central
    Pacific to the U.S., Chinese leaders are likely to undertake a variety
    of actions to influence and deter states in the region, as well as to
    hold American territories in the area at risk.
        There has already been an effort underway to expand China's
    economic presence in the region. Ini 2024, China was the second largest
    aid provider to the region, ahead of the United States and behind
    Australia.21 Much of this aid is in the form of loans, not
    grants. But, for the Pacific Island countries, who have a paucity of
    infrastructure, there are few choices. In the case of Vanuatu, for
    example, China has been willing to provide a majority of bilateral
    infrastructure funding.22 Moreover, as one analyst has
    observed, ``It is easier to apply for Chinese loans because they
    require less paperwork and do not have the same requirements in areas
    such as good governance, financial reform, human rights, and
    democracy.'' 23
        In addition to aid, though, the PRC also engages in trade and
    investment. A recent series of agreements signed by the Cook Islands'
    prime minister and the PRC ``cover infrastructure, ship--building,
    tourism, agriculture, technology, education and, perhaps crucially,
    deep-sea mineral exploration.'' 24 Chinese tourism,
    meanwhile, constitutes a major source of income for states such as Fiji
    and the Commonwealth of the Northern Mariana Islands.25
        This is backed by the growing ability of the PLA to project power.
    As noted earlier, Chinese naval forces have conducted operations in
    areas such as the Tasman Sea and the Gulf of Aden that are farther from
    China than the Federated States of Micronesia or Guam; they can clearly
    therefore operate in the central Pacific. China's growing fleet of
    aircraft carriers, and as important its array of support ships, means
    that it should be expected to undertake patrols and extended visits to
    the region.
        Chinese air force units also operate at increasing distances from
    the mainland. The 2024 DOD report on Chinese military capabilities
    notes that the most recent versions of the Chinese H-6 bomber can carry
    land-attack cruise missiles (LACMs). ``H-6K bomber flights into the
    Philippine Sea demonstrate the PRC's ability to range Guam with air-
    launched LACMs.'' 26
        In event of war, these capabilities would be supplemented by the
    PLA Rocket Force (PLARF). Over the past decade, the PLARF has been
    fielding an array of new conventional missiles that will give the CCP
    leadership additional options to hold both American military forces and
    local states at risk. This includes the DF-26 intermediate range
    ballistic missile and the DF-17 hypersonic glide vehicle (HGV). A new
    missile, the DF-27, appears to have a range that straddles the IRBM-
    ICBM line while carrying an HGV payload. The 2024 DOD report on China
    notes that ``a PRC--based commentator stated that the DF-27 can be used
    to strike high-value targets on Guam, indicating that the DF-27 would
    primarily be used for regional conventional strikes during a
    conflict.'' 27
        Such systems should be viewed in the context of the PLA's
    ``campaign basic guiding concept,'' i.e., how the Chinese military
    thinks it will undertake campaigns. The 2006 version of the ``campaign
    basic guiding concept'' laid out the idea of ``integrated operations,
    precision strikes to control the enemy (zhengti zuozhan, jingda
    zhidi).'' Precision strikes are described as those involving the use of
    precision munitions to attack vital targets. The goal is not only
    destroying key points, but also precisely controlling the course and
    intensity of a conflict.28 It also entails disrupting the
    enemy's system, and not just their weapons or forces.29
        The emphasis on disrupting the adversary's systems makes many of
    the central Pacific islands, but especially Guam, a likely high
    priority for PRC efforts in time of crisis or conflict. U.S. bombers
    and tankers are regularly deployed to Andersen Air Force, allowing
    rapid, flexible application of massive firepower. The U.S. Navy has
    begun to forward deploy nuclear attack submarines to Guam.30
        As important, the island hosts a number space-related facilities.
    One of the tracking sites for the Satellite Control Network, which
    provides real-time command and control support to U.S. forces worldwide
    through satellite management, is located on the island. One of NASA's
    two ground facilities for its Tracking and Data Relay Satellites (TDRS)
    network is also located on Guam.31 Disruption of these
    facilities would help the PLA achieve information dominance. Similarly,
    the island is a key landing point for a variety of undersea cables.
    Striking these sites would complement cable-cutting efforts to
    interrupt global communications and data transmission.
        Finally, the U.S. Navy stores millions of pounds of munitions and
    high explosive at the Ordnance Annex. The tank farm at Andersen Air
    Force Base can hold up to 66 million gallons of fuel, making it the
    largest single facility in the U.S. Air Force.32 Successful
    attacks against these logistical hubs would crimp the ability of combat
    forces to sustain operations.

                                     *****

    ENDNOTES

        1 Daniel M. Hartnett, ``The `New Historic Missions': Reflections on
    Hu Jintao's Military Legacy,'' in Assessing the People's Liberation
    Army in the Hu Jintao Era, ed. by Roy Kamphausen, David Lai, et. al.
    (Carlisle, PA: Army War College, 2014).
        2 Weiping Zheng, Minfu Liu, Discussions on the Military's New
    Historic Missions (Beijing, PRC: People's Armed Police Publishing
    House, 2005), p. 138.
        3 Edward Dreyer, Zheng He: China and the Oceans in the Early Ming
    Dynasty 1403-1433 (Old Tappan, NJ: Pearson Longman, 2006).
        4 International Institute for Strategic Studies, The Military
    Balance 1995-1996 (London, UK: Oxford University Press, 1995), pp. 177-
    179.
        5 https://media.defense.gov/2024/Dec/18/2003615520/-1/-1/0/
    MILITARY-AND-SECURITY-DEVELOPMENTS-INVOLVING-THE-PEOPLES-REPUBLIC-OF-
    CHINA-2024.PDF
        6 Sam Lagrone, ``Two Chinese Warships Enter Black Sea, reports Link
    Visit to Possible Chinese Frigate Sale to Russia,'' USNI News (May 5,
    2015) https://news.usni.org/2015/05/05/two-chinese-warships-enter-
    black-sea-reports--link-visit-to-possible-chinese-frigate-sale-to-
    russia, and ``China in Baltic Navy Drill with Russia,'' BBC (July 21,
    2017) https://www.bbc.com/news/world-europe-40682442
        7 Ryan Chan, ``Map Shows Chinese Navy Fleet's 300-Day Mission to
    Three Continents,'' Newsweek (January 27, 2025) https://
    www.newsweek.com/china-news-navy-ships-escort-mission-middle-east-asia-
    africa-europe-2021107
        8 Rod McGuirk and Charlotte Graham-McClay, ``China Issued
    `Disconcerting' Warning of Live Fire Exercises to Planes Flying Above,
    Australia Says,'' AP (February 21, 2025) https://apnews.com/article/
    australia-new-zealand--chinese-flight-diverted-
    08067898b342c350ce7ef7cec56717de
        9 Yubiao Gao, Chief Editor, Joint Campaign Teaching Materials
    (Beijing, PRC: Academy of Military Science Publishing House, 2001), p.
    54.
        10 Xianqi Chang, et. al., Military Astronautics, 2nd Edition
    (Beijing, PRC: National Defense Industries Press, January 2005), p.
    249.
        11 Robert Burns, ``Satellite Photos Give a Bird's Eye View of
    Ukraine Crisis,'' AP (February 18, 2022) https://apnews.com/article/
    russia-ukraine-europe-russia-belarus-0b5ca81d822671b5ef2c514bf531505c
        12 Jordan Teicher, ``Are These Satellite Images War Propaganda?''
    The New Republic (March 31, 2022) https://newrepublic.com/article/
    165910/maxar-ukraine-russia-satellite-images-war-propaganda
        13 Xianqi Chang, Military Astronautics, 2nd Ed., (Beijing, PRC:
    Defense Industries Publishing House, 2005), p. 304, and Lianju Jiang,
    Space Operations Teaching Materials (Beijing, PRC; Military Sciences
    Publishing House, 2013), pp. 150-152.
        14 DOD Military and Security Developments involving the People's
    Republic of China, p. 70, https://media.defense.gov/2023/Oct/19/
    2003323409/-1/-1/1/2023-MILITARY-AND-SECURITY-DEVELOPMENTS-INVOLVING-
    THE-PEOPLES-REPUBLIC-OF-CHINA.PDF
        15 Xinzhao Xu, ``Examining How Information Has Become a Key Factor
    in Combat Power,'' Jianghui Forum (#2, 2001), pp. 65, 71.
        16 All Army Military Terminology Management Commission, Chinese
    People's Liberation Army Terminology (Unabridged Volume), (Beijing,
    PRC: Military Science Publishing House, 2011), p. 79.
        17 Chinese Military Encyclopedia 2nd Edition Editorial Committee,
    PLA Encyclopedia, 2nd Edition, Military Strategy (Beijing, PRC: China
    Encyclopedia Publishing House, 2007), p. 68.
        18 Gaoming Fan, ``Public Opinion Warfare, Psychological Warfare,
    and Legal Warfare, the Three Major Combat Methods to Rapidly Achieving
    Victory in War,'' Global Times (March 8, 2005), http://
    big5.xinhuanet.com/gate/big5/news.xinhuanet.com/mil/2005-03/08/
    content--2666475.htm
        19 L.N. Reklai, ``Palau Says Chinese Vessel Slowed Over Undersea
    Cable During Incursion into Waters,'' Radio Free Asia (May 31, 2023)
    https://www.rfa.org/english/news/pacific/palau-china-cable-
    05312023014251.html.
        20 Yimou Lee, ``Taiwan Detains China-Linked Cargo Ship After
    Undersea Cable Disconnected,'' Reuters (February 25, 2025) https://
    www.reuters.com/world/asia-pacific/taiwan-detains-china-linked-cargo-
    ship-after-undersea-cable-disconnected-2025-02-25/
        21 ``China Reclaims Position as Second Largest Donor to Pacific
    Islands, Report Finds,'' Voice of America (November 20, 2024) https://
    www.voanews.com/a/china-reclaims-position-as-second-largest-donor-to-
    pacific--islands-report-finds/7870835.html
        22 Alexandre Dayant, Riley Duke, ``A New China Loan Threatens
    Vanuatu's Debt Outlook,'' Lowy Interpreter (February 6, 2024) https://
    www.lowyinstitute.org/the-interpreter/new-china-loan-threatens-vanuatu-
    s-debt-outlook
        23 Darshana Baruah, Satyendra Prasad, and Denghua Zhang, ``How
    Chinese Financing Shapes the Pacific,'' Carnegie Endowment (February 8,
    2024) https://carnegieendowment.org/posts/2024/02/how-chinese-
    financing-shapes-the-pacific?lang=en
        24 Katy Watson, ``Cook Islands China Deal Riles Allies as West's
    Grip Loosens,`` BBC (February 28, 2025) https://www.bbc.com/news/
    articles/cvg559y0803o
        25 Yuan Zhi Ou, ``The Northern Mariana Islands: US-Territory,
    China-Dependent,'' The Diplomat (September 25, 2021)
        26 https://media.defense.gov/2024/Dec/18/2003615520/-1/-1/0/
    MILITARY-AND-SECURITY-DEVELOPMENTS--INVOLVING-THE-PEOPLES-REPUBLIC-OF-
    CHINA-2024.PDF
        27 https://media.defense.gov/2024/Dec/18/2003615520/-1/-1/0/
    MILITARY-AND-SECURITY-DEVELOPMENTS--INVOLVING-THE-PEOPLES-REPUBLIC-OF-
    CHINA-2024.PDF
        28 Zhang Yuliang, Chief Editor, The Science of Campaigns (Beijing,
    PRC: National Defense University Publishing House, 2006), p. 81.
        29 Wang Weiyu, Zhang Qiancheng, Discussing Military Theory
    Innovation with Chinese Characteristics (Beijing, PRC: National Defense
    University Publishing House, 2009), pp. 202-203.
        30 1st LT James Caliva, ``First Forward Deployed Virginia Class
    Submarine Arrives in Guam'' (November 2024) https://www.cpf.navy.mil/
    Newsroom/News/Article/3978978/first-forward-deployed-virginia-class-
    submarine-arrives-in-guam/
        31 https://www.nasa.gov/mission/tracking-and-data-relay-satellites/
        32 Abraham Mahshie, ``Pacific Refueling,'' Air & Space Forces
    Magazine (August 29, 2022) https://www.airandspaceforces.com/article/
    pacific-refueling/

                                     ______

     Questions Submitted for the Record to Mr. Dean Cheng, Senior Fellow,
               Potomac Institutefor Policy Studies, Arlington, VA

                Questions Submitted by Representative Westerman

        Question 1. How is the flow of narcotics into the Pacific
    territories from PRC tourists and PRC criminal organizations affecting
    the safety of Americans on the islands?

        Answer. I regret that I am not sufficiently conversant with the
    issue of narcotics flows into the Pacific territories from the PRC to
    be able to answer this question.

        Question 2. The PLA's Navy is increasing their strength and their
    ability to conduct operations at greater distances. What is the threat
    level posed by the PLA's Navy to the Pacific territories?

        2a) How does this specifically put Americans in the Pacific
    territories at risk?

        Answer. The growing capabilities of the Chinese People's Liberation
    Army (PLA) are detailed in the annual report by the Department of
    Defense to Congress ``Military and Security Developments Involving the
    People's Republic of China.'' The latest iteration of that report,
    which was mandated by Congress in the FY2000 National Defense
    Authorization Act may be found here: https://media.defense.gov/2024/
    Dec/18/2003615520/-1/-1/0/MILITARY-AND-SECURITY-DEVELOPMENTS-INVOLVING-
    THE-PEOPLES-REPUBLIC-OF-CHINA-2024.PDF
        Because of the growing capabilities of the overall PLA, and not
    just the PLA Navy (PLAN), the ability of U.S. forces to operate within
    the ``first island chain'' stretching from Japan, through Okinawa, the
    Senkakus, Taiwan, and the Philippines to the Straits of Malacca is
    becoming increasingly challenging. China fields a growing array of
    systems, including anti-ship ballistic missiles, anti-ship cruise
    missiles, surface and sub-surface combatants, unmanned aerial vehicles,
    as well as various aerial platforms, that can hold U.S. forces at risk
    throughout the east Asian littoral.
        Consequently, U.S. military planners are increasingly looking to
    the ``second island chain'' to sustain any conflict in the INDOPACOM
    area of responsibility. The ``second island chain'' encompasses the
    island groupings of the central Pacific, including Guam, the Federated
    States of Micronesia, Yap, Palau, and the Commonwealth of the Northern
    Mariana Islands, and are essential as fall-back positions, as well as
    to provide essential logistical support and basing options, The PRC is
    well aware of these efforts, and is therefore taking steps, in turn, to
    counter American diplomatic and military efforts in this region.
        Much of this effort is in the diplomatic and economic domains,
    including Chinese investments, outreach, offers of academic
    scholarships, and other means of wooing the populations of these island
    groupings. In addition, though, there is a steady growth in Chinese
    military ability to threaten the islands and their populations. China
    is currently developing an array of missiles, including intermediate
    range ballistic missiles as well as longer-ranged air-launched cruise
    missiles, that can strike the islands. It is also alleged that Chinese
    hackers are responsible for a range of cyber intrusions that have
    penetrated the information systems of various critical infrastructure
    on Guam and likely elsewhere in the region. This includes the Volt
    Typhoon hacking group, which is believed to be a state-sponsored PRC
    hacking group.\1\
    ---------------------------------------------------------------------------
        \1\  https://www.cisa.gov/news-events/cybersecurity-advisories/
    aa24-038a
    ---------------------------------------------------------------------------
        A physical attack against military targets on Guam or the CNMI
    would obviously place American citizens in jeopardy. However, an attack
    against critical infrastructure on Guam or the CNMI would pose an even
    greater threat. Whereas kinetic attacks might be solely undertaken
    against purely military targets (e.g., Andersen Air Force Base
    facilities), the Volt Typhoon hackers, for example, are targeting power
    and water systems which serve both military and civilian customers.
    Volt Typhoon activities have been identified against the Guam Power
    Authority, which is the only supplier of electricity to the island,
    supporting both military and civilian customers.\2\ Attacking
    communications, water, power, and transportation systems on these
    islands would therefore threaten the lives of the entire population,
    not just those who are on military facilities.
    ---------------------------------------------------------------------------
        \2\ Anton Shilov, ``U.S. uncovers hacking campaign targeting Guam's
    critical infrastructure--suspected Chinese Volt Typhoon hacks could
    disrupt the defense of Taiwan,'' Tom's Hardware (January 5, 2025)
    https://www.tomshardware.com/tech-industry/cyber-security/u-s-uncovers-
    hacking-campaign-targeting-guams-critical-infrastructure-suspected-
    chinese-volt-typhoon-hacks-could-disrupt-the-defense-of-taiwan

        Question 3. What problems will Illegal, Unregulated, and Unreported
    ---------------------------------------------------------------------------
    fishing cause the Pacific territories if left unaddressed?

        Answer. Illegal, unregulated, and unreported (IUU) fishing
    obviously poses an environmental and economic threat to the various
    central Pacific island groupings, including both independent nations
    such as Palau and Yap, as well as the American territories of Guam and
    the Commonwealth of the Northern Mariana Islands. In addition, however,
    they also create a potential line of military risk as well.
        The Chinese People's Liberation Army Navy (PLAN) includes not only
    its active duty elements, which now constitutes the largest navy in the
    world, but also the People's Armed Force Maritime Militia (PAFMM). The
    PRC fields one of the world's largest fishing fleets, involving
    literally thousands of fishing boats. While most of these are only
    capable of operating near the PRC's shores, the PRC does have distant
    water fishing (DWF) fleets capable of operating in any of the world's
    oceans. While these fishing fleets largely operate for commercial and
    aquaculture purposes (i.e., supplying seafood to domestic and foreign
    customers), the PAFMM elements within them also can be called upon to
    support PLAN operations.
        PAFMM elements have played a central role in the `gray zone'
    activities in the South China Sea, harassing foreign vessels and
    helping assert Chinese maritime sovereignty claims. The USNS Impeccable
    incident of 2009 was undertaken in part by what would now be considered
    PAFMM elements.
        The presence of Chinese fishing vessels undertaking IUU fishing
    activities in the waters around Guam and the CNMI would therefore
    provide the PRC with important military as well as commercial and
    fishing benefits. Such vessels, for example, could provide early
    warning to PRC military commanders of air operations from Andersen Air
    Force Base. Similarly, they could be undertaking oceanographic surveys,
    or providing cover for other vessels that are doing so. Given their
    past history, they may also be employed to undertake harassment of U.S.
    Navy vessels.

                                     ______

        Mr. Hurd. Thank you very much, Mr. Cheng. The Chair now
    recognizes Mr. Bruce Klingner for 5 minutes.
        Mr. Klingner.

       STATEMENT OF BRUCE KLINGNER, SENIOR RESEARCH FELLOW, THE
                 HERITAGE FOUNDATION, WASHINGTON, D.C.

        Mr. Klingner. Chairman Hurd, Ranking Member Leger
    Fernandez, and distinguished members of the Subcommittee, I
    thank you for the opportunity to appear before you. My comments
    this morning are my own.
        North Korea's nuclear missile and conventional forces are a
    formidable threat to the United States and its forces,
    citizens, and bases, in the Indo-Pacific. Pyongyang's history
    of provocation and intimidation is a consistent indicator of
    the regime's intent to achieve its political objectives through
    the threat or execution of force.
        North Korea is producing a new generation of advanced
    mobile missiles that, in addition to being more accurate, more
    mobile, and more difficult to detect and target, have an
    enhanced ability to evade Allied missile defenses.
        In 2022, Pyongyang passed a law that lowered the threshold
    for its use of nuclear weapons. The new legislation codifies a
    decade of North Korean statements that highlighted both the
    defensive mission for its nuclear arsenal while concurrently
    threatening a pre-emptive nuclear attack in response to even
    perceived Allied preparations for an attack, raising the
    potential for stumbling into a nuclear war.
        North Korea's diversified nuclear attack strategy includes,
    one, targeting South Korean ports and airfields to prevent the
    U.S. from augmenting forces during a conflict, as well as
    threatening South Korean leadership and military targets to
    coerce Seoul to surrender or abandon a counteroffensive attack
    on North Korea.
        Two, removing Japan from the equation. Pyongyang could
    threaten nuclear attacks to intimidate Tokyo into rejecting the
    use of Japanese ports, airfields, and bases for U.S. and UN
    command operations against North Korea.
        Three, attacking U.S. bases in Guam. North Korea could use
    the Hwasong-12, liquid fueled, and Hwasong-16, solid fueled,
    intermediate range ballistic missiles, both equipped with two
    variants of maneuverable warheads, to conduct theater nuclear
    strikes against U.S. bases in Guam to prevent the flow of
    forces and logistics to the Korean Peninsula. Pyongyang could
    also use long range ground and sea launched cruise missiles.
        North Korea has repeatedly threatened to attack Guam. I
    provided a compilation of these threats in my written
    testimony. Some examples include the U.S. should not forget
    that the Andersen Air Force Base on Guam is within striking
    range of North Korea's precision strike means, and all the U.S.
    military bases and the operational theater in the Pacific,
    including Guam, will face ruin in the face of an all-out and
    substantial attack. In November 2023 North Korea successfully
    launched its first military reconnaissance satellite. Pyongyang
    announced the satellite surveilled Andersen Air Force Base,
    Apra Harbor, and other major U.S. military bases in Guam.
        And four, threatening the U.S. mainland. North Korea has
    developed a series of ICBMs capable of attacking anywhere in
    the continental United States, including the Hwasong-17, the
    world's largest mobile missile, which may carry three or four
    nuclear warheads, and the Hwasong-18 and 19 solid fuel ICBMs.
    Pyongyang's deployment of more missiles on mobile launchers
    with multiple warheads risks overwhelming the limited U.S.
    missile defenses protecting the American homeland.
        North Korea's future capabilities open dangerous doors. In
    a few years, North Korea could have 100 to 200 nuclear
    warheads, dozens of mobile ICBMs, and hundreds of improved,
    survivable ground-based missiles, as well as submarine launched
    missiles. Greater North Korean nuclear capabilities could
    undermine the effectiveness of existing Allied military plans.
    North Korea's ability to target American cities with
    thermonuclear weapons could inhibit U.S. responses or
    exacerbate growing Allied concerns about the viability of the
    U.S. extended deterrence guarantee.
        What should the U.S. do? Affirm America's commitment to
    defend its allies. Washington should make absolutely clear to
    friend and foe alike that it will defend its allies by
    continually reaffirming its extended deterrence guarantee to
    use all necessary force, including nuclear weapons, in response
    to a North Korean attack.
        Enhanced strategic defense of the American homeland. The
    U.S. should continue plans to augment the current force of 44
    ground-based interceptors to 64 by fielding the next generation
    interceptor which has improved capabilities to better engage
    North Korea's advanced missiles.
        Augment U.S. regional ballistic missile defense.
    Pyongyang's expanding missile force increases the threat to
    U.S. forces in the Indo-Pacific region. Washington should
    augment the existing THAAD missile defense system on Guam,
    which is a critical node in U.S. regional military plans. The
    United States should deploy an Aegis Ashore system on Guam
    while simultaneously initiating an effort to improve the system
    incrementally with additional sensors and shooters, and
    complete modernization programs for U.S. nuclear forces.
        In conclusion, the United States must ensure that it can
    protect the American homeland and U.S. forces in the Indo-
    Pacific region against the growing North Korean nuclear and
    missile threat. Washington should coordinate with South Korea
    and Japan to improve comprehensive Allied missile defenses. The
    U.S. and its allies must also have sufficient offensive
    capabilities to reduce the number of North Korean missiles that
    are launched.
        Thank you for the honor of appearing before you, and I look
    forward to your questions.

        [The prepared statement of Mr. Klingner follows:]
       Prepared Statement of Bruce Klingner, Senior Research Fellow for
                    Northeast Asia, The Heritage Foundation

        My name is Bruce Klingner. I am Senior Research Fellow in the Asian
    Studies Center at The Heritage Foundation. I have focused on North and
    South Korea for 32 years while at the Heritage Foundation and
    previously with the Central Intelligence Agency and Defense
    Intelligence Agency. The views I express in this testimony are my own
    and should not be construed as representing any official position of
    The Heritage Foundation.
        North Korea's nuclear, missile, and conventional forces are a
    formidable threat to the United States and its forces, citizens, and
    bases in the Indo-Pacific. Pyongyang's history of provocation and
    intimidation is a consistent indicator of the regime's intent to
    achieve its political objectives through the threat or execution of
    force.
        North Korean leader Kim Jong-un directed an expansive
    diversification of North Korea's arsenal and accelerated nuclear and
    missile testing. New weapons overcame the shortcomings of their
    predecessors and now pose a far greater threat to allied forces,
    including missile defense systems.
        Pyongyang's continuing development of nuclear and missile programs
    beyond the necessary requirements for deterrence suggests that the
    regime strives for a true warfighting strategy. Such a development
    would not only further increase the military threat but also raise the
    potential for greater willingness to engage in ever more provocative
    behavior as well as coercive diplomacy.
    Strategic Objectives of North Korea's Nuclear Program
        The regime's nuclear weapons concurrently fulfill several domestic,
    foreign policy, and military objectives. Specifically, they:

         Provide leadership legitimacy. Kim Jong-un linked his
                personal prestige and legitimacy as leader to North Korea's
                nuclear and missile programs. Kim's gaining of de facto
                international recognition of North Korea as a nuclear
                weapons state is a source of national pride and perceived
                as achieving equal status with the United States.

         Preserve the nation and the Kim regime. Pyongyang
                justifies its nuclear weapons as guaranteed protection
                against the U.S. ``hostile policy'' of military attacks and
                regime change against authoritarian regimes.

         Decouple the U.S. from its alliances. Pyongyang's
                increasing ability to target the continental U.S. with
                nuclear weapons has aggravated South Korean and Japanese
                concerns about U.S. capability, resolve, and willingness to
                defend their countries. North Korea seeks to erode the
                credibility of the U.S. extended deterrence guarantee by
                sowing doubt that Washington would come to allies' defense
                once the American homeland is under nuclear threat.

         Enhance coercive diplomacy. Attaining an unambiguous
                nuclear intercontinental ballistic missile (ICBM)
                capability could lead North Korea to perceive that it has
                immunity from any international response. Pyongyang could
                feel emboldened to act even more belligerently and seek to
                intimidate the U.S. and its allies into accepting North
                Korean diktats.

         Augment warfighting capability. Nuclear weapons are the
                great equalizer. North Korean nuclear weapons deter allied
                preemptive or decapitation attacks, inhibit allied military
                responses to North Korean actions, and threaten the
                American homeland. Preemptive nuclear attacks could target
                U.S. forces arriving on the Korean Peninsula and allied
                forces preparing a counteroffensive advance into North
                Korea, hold allied and U.S. cities at risk, and potentially
                provide the means for Pyongyang to reunify the peninsula on
                its terms.

        Pyongyang has repeatedly declared that it would never abandon its
    nuclear arsenal and that ``only fools will entertain the delusion that
    we will trade our nuclear deterrent for petty economic aid.'' \1\ The
    North Korean leadership has affirmed that the country's nuclear weapons
    ``are not goods for getting U.S. dollars'' and not ``a political
    bargaining chip.'' \2\ Pyongyang has declared that is nuclear arsenal
    provides a ``trusted shield'' \3\ and ``treasured sword'' \4\ to
    support both defensive and offensive missions.
    ---------------------------------------------------------------------------
        \1\ ``North Korea Pledges Not to Abandon Nukes,'' The Korea Herald,
    February 21, 2010, https://www.asiaone.com/News/Latest%2BNews/Asia/
    Story/A1Story20100221-199951.html.
        \2\ ``2013 Plenary Meeting of WPK Central Committee and 7th Session
    of Supreme People's Assembly,'' North Korean Economy Watch, April 1,
    2013, https://www.nkeconwatch.com/2013/04/01/2013-plenary-meeting-of-
    wpk-central-committee-and-supreme-peoples-assembly/.
        \3\ ``N. Korea Says No Plans to Give up Nuclear Capabilities,''
    Yonhap News Agency, May 28, 2013, https://en.yna.co.kr/view/
    AEN20130528008400315.
        \4\ Josh Smith, `` `Treasured Sword': North Korea Seen as Reliant
    as Ever on Nuclear Arsenal as Talks Stall,'' Reuters, November 13,
    2018, https://www.reuters.com/article/us-northkorea-missiles-nuclear-
    analysis/treasured-sword-north-korea-seen-as-reliant-as-ever-on-
    nuclear-arsenal-as-talks-stall-idUSKCN1NI132
    ---------------------------------------------------------------------------
        After assuming power in December 2011, Kim Jong-un directed the
    North Korean military to develop a new strategy to invade and occupy
    Seoul within three days and all of South Korea within seven days.
    Accomplishing this objective would necessitate early use of nuclear
    weapons and missiles against superior allied conventional forces.\5\
    North Korea has warned that ``any military conflict on the Korean
    Peninsula is bound to lead to an all-out [nuclear] war'' that will be
    an ``ultra-harsh war of reaction targeting the entire U.S. mainland.''
    \6\
    ---------------------------------------------------------------------------
        \5\ Jeong Yong-soo and Ser Myo-ja, ``Kim Jong-un Ordered a Plan for
    a 7-Day Asymmetric War: Officials,'' Korea JoongAng Daily, January 7,
    2015, http://koreajoongangdaily.joins.com/news/article/
    Article.aspx?aid=2999392.
        \6\ Max Fisher, ``Here's North Korea's Official Declaration of
    War,'' The Washington Post, March 30, 2013, https://
    www.washingtonpost.com/news/worldviews/wp/2013/03/30/heres-north-
    koreas-official-declaration-of-war/, and Yonhap News Agency, ``N. Korea
    Threatens `Ultra-Harsh Action' on U.S. Soil over Hacking Allegation,''
    December 21. 2014, https://www.pri.org/stories/2014-12-21/north-korea-
    threatens-ultra-harsh-action-us-soil-over-hacking-allegation.
    ---------------------------------------------------------------------------
        Troubling Changes to North Korea's Nuclear Doctrine. In September
    2022, Pyongyang passed a law that codifies long-standing nuclear
    doctrine that disturbingly lowered the threshold for its use of nuclear
    weapons. The new legislation affirms a decade of North Korean
    statements that highlighted both the defensive nature of its nuclear
    arsenal while concurrently threatening pre-emptive nuclear attacks on
    the United States and its allies in response to even perceived
    preparations for an attack.
        Given its poor intelligence and reconnaissance capabilities,
    Pyongyang might misconstrue allied actions, such as routine military
    exercises or response to a North Korean provocation, as a prelude to an
    actual attack. Pyongyang might assume the worst and rush to pre-empt
    the perceived pre-emption, raising the risk of inadvertently stumbling
    into a nuclear conflict.
    North Korea's Diversified Nuclear Attack Strategy
        Pyongyang is producing a new generation of advanced mobile missiles
    that, in addition to being more accurate, more mobile, and more
    difficult to detect and target, have an enhanced ability to evade
    allied missile defenses. North Korea's evolving nuclear and missile
    forces increasingly provide the regime with the ability to conduct a
    preemptive first strike, retaliatory second strike, and battlefield
    counter-force attacks. Pyongyang has an extensive and diversified
    military force to attack targets in South Korea, Japan, U.S. bases in
    the Pacific, and the continental United States.
        Targeting South Korea. To prevent the U.S. from augmenting forces
    in South Korea during a conflict, North Korea could use nuclear weapons
    to attack South Korean ports and airfields. Pyongyang could threaten
    South Korean leadership and military targets with a nuclear attack to
    coerce Seoul to surrender or abandon a counteroffensive attack on North
    Korea. U.S. bases in South Korea would be high-priority targets.
        The U.S. and its allies have assessed for a decade that North Korea
    has nuclear weapons for short-range and medium-range Scud and No-dong
    missiles that could target South Korea and Japan. In January 2021, Kim
    Jong-un declared that the regime had created ``ultra-modern tactical
    nuclear weapons including new-type tactical rockets.'' \7\
    ---------------------------------------------------------------------------
        \7\ ``On Report Made by Supreme Leader Kim Jong Un at Eighth Party
    Congress of WPK,'' Korea Central News Agency, January 9, 2021, https://
    kcnawatch.org/newstream/1610155111-665078257/on-report-made-by-supreme-
    leader-kim-jong-un-at-8th-congress-of-wpk/.
    ---------------------------------------------------------------------------
        While not all North Korean missiles would have nuclear warheads,
    Pyongyang could saturate missile defenses with large numbers of
    conventionally armed missiles. North Korea has demonstrated the ability
    to fire a salvo of several missiles at once, which could overwhelm
    allied BMD systems. The regime also has deployed more capable, longer-
    range artillery and multiple rocket launchers to augment missile
    attacks.
        Removing Japan from the Equation. Pyongyang could threaten nuclear
    attacks to intimidate Tokyo into rejecting the use of Japanese ports,
    airfields, and bases for U.S. and U.N. Command operations against North
    Korea.
        In 2017, North Korea threatened to ``reduce the U.S. mainland into
    ashes and darkness'' and warned that ``[t]he four islands of the
    [Japanese] archipelago should be sunken into the sea by [our] nuclear
    bomb . . . Japan is no longer needed to exist near us.'' \8\ North
    Korea also identified the Japanese cities of Tokyo, Kyoto, Nagoya,
    Osaka, and Yokohama as targets. \9\
    ---------------------------------------------------------------------------
        \8\ Jack Kim and Kiyoshi Takenaka, ``North Korea Threatens to
    `Sink' Japan, Reduce U.S. to `Ashes and Darkness,' '' Reuters,
    September 14, 2017, https://www.reuters.com/article/us-northkorea-
    missiles/north-korea-threatens-to-sink-japan-reduce-u-s-to-ashes-and-
    darkness- idUSKCN1BP0F3.
        \9\ Japan Ministry of Defense, White Paper, Defense of Japan 2017,
    Part I, Chapter 1, Section 2, ``Korean Peninsula,'' p. 60, https://
    warp.da.ndl.go.jp/info:ndljp/pid/11591426/www.mod.go.jp/e/publ/w-paper/
    pdf/ 2017/DOJ2017_1-2-2_web.pdf.
    ---------------------------------------------------------------------------
        Attacking U.S. Bases in Guam. North Korea could use the Hwasong-12
    liquid-fueled and Hwasong-16 solid-fueled intermediate-range ballistic
    missiles, both with two variants of maneuverable warheads, to conduct
    theater nuclear strikes against U.S. bases in Guam to prevent the flow
    of forces and logistics to the Korean Peninsula. Pyongyang could also
    use the Hwasal-1/2 long-range ground-launched cruise missile and
    Bulwhasal-3-31 sea-launched cruise missile.
        Cruise missiles can fly lower than ballistic missiles and with
    maneuverable, less predictable trajectories to evade missile defense
    radars. Cruise missiles can hit their target from any direction,
    thereby posing difficulties for missile defense systems such as THAAD
    that do not have 360-degree radar coverage.

        North Korea has repeatedly threatened to attack Guam:

         In October 2012, the National Defense Commission warned
                its strategic rocket forces can hit the continental United
                States and American bases in South Korea, Japan, and
                Guam.\10\

        \10\ ``North Korea Says Its Rockets Could Hit Continental US,''
    Chosun Ilbo, October 12, 2012.
    ---------------------------------------------------------------------------
         In March 2013, the Supreme Command of the Korean People's
                Army warned that ``the U.S. should not forget that the
                Anderson Air Force Base on Guam . . . and naval bases in
                Japan and Okinawa . . . are within the striking range of
                the DPRK's precision strike means.'' \11\

        \11\ ``N. Korea Warns of `Precision Strike' on U.S. Bases,'' CBS
    News, April 5, 2013, https://www.cbsnews.com/news/n-korea-warns-of-
    precision-strike-on-us-bases/.
    ---------------------------------------------------------------------------
         In March 2013, North Korea put all of its artillery and
                rocket forces on the highest state of wartime alert,
                including units ``assigned to strike bases of the U.S.
                imperialist aggressor troops in the U.S. mainland and on
                Hawaii and Guam and other operational zone in the
                Pacific.'' \12\ The Korea Workers Party Central Committee
                warned that its first strike ``will blow up the U.S. bases
                for aggression in its mainland and in the Pacific
                operational theatres including Hawaii and Guam.'' \13\

        \12\ Jethro Mullen, North Korea issues new threat to U.S. bases,
    CNN, March 26, 2013, http://www.cnn.com/2013/03/26/world/asia/north-
    korea-us-threats/
    index.html?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+rs
    s%2Fcnn_ world+%28RSS%3A+World%29.
        \13\ ``North-South Relations Have Been Put at State of War: Special
    Statement of DPRK,'' Korea Central News Agency, March 30, 2013, http://
    www.kcna.co.jp/item/2013/201303/news30/20130330-07ee.html.
    ---------------------------------------------------------------------------
         In March 2016, the National Defense Commission warned of a
                preemptive attack and ``offensive means have been deployed
                to put major strike targets in the operation theaters of
                South Korea within the firing range and the powerful
                nuclear strike means targeting the U.S. imperialist
                aggressor forces bases in the Asia-Pacific region and the
                U.S. mainland are always ready to fire.'' \14\

        \14\ ``National Defense Commission, Foreign Ministry Issues
    Statements on Foal Eagle, Key Resolve,'' NK Leadership Watch, March 6,
    2016, https://nkleadershipwatch.wordpress.com/2016/03/06/national-
    defense-commission-foreign-ministry-issues-statements-on-foal-eagle-
    key-resolve/

         In April 2016, Pyongyang declared ``the Korean People's
                Army has long put into the range of its precision strike
                the U.S. bases and logistic bases for invading the DPRK,
                including the Anderson Air Force Base on Guam where B-52Hs
    ---------------------------------------------------------------------------
                are deployed and naval bases for nuclear submarines.'' \15\

        \15\ ``National Defense Commission Spokesman Issues Statement on
    Peninsula Security,'' North Korea Leadership Watch, June 21, 2016,
    https://nkleadershipwatch.wordpress.com/2016/06/21/national-defense-
    commission-spokesman-issues-statement-on-peninsula-security/.
    ---------------------------------------------------------------------------
         In August 2017, the Ministry of Foreign Affairs declared
                that ``all the U.S. military bases in the operational
                theater in the Pacific including Guam will face ruin in the
                face of all--out and substantial attack.'' \16\ To
                emphasize its threat, Pyongyang announced that it was
                considering ``making an enveloping fire at the areas around
                Guam with medium-to-long-range strategic ballistic rocket
                Hwasong-12 in order to contain the U.S. major military
                bases on Guam.'' \17\ The plan was to have the missiles
                impact 30-40 kilometers on either side of Guam.\18\

        \16\ Clynt Ridgell, ``North Korea Threatened Guam Numerous Times in
    the Past,'' PNC [Pacific News Center], August 9, 2017, https://
    www.pncguam.com/north-korea-threatened-guam-numerous-times-in-the-
    past/.
        \17\ Christine Kim and Soyoung Kim, ``North Korea Says Seriously
    Considering Plan to Strike Guam: KCNA,'' Reuters, August 8, 2017,
    https://news.yahoo.com/north-korea-says-seriously-considering-plan-
    strike-guam-222757124.html.
        \18\ Jung In-hwan, ``Is N.Korea Raising Peninsula Tensions in Bid
    for US Negotiations?'' Hankyoreh, August 11, 2017, http://
    english.hani.co.kr/arti/english_edition/e_northkorea/806473.html.
    ---------------------------------------------------------------------------
         In October 2017, North Korea renewed a threat to launch
                missiles toward Guam, warning that ``reckless moves'' by
                the U.S. would compel Pyongyang to take action. ``We have
                already warned several times that we will take
                counteractions for self-defense, including a salvo of
                missiles into waters near the US territory of Guam.'' \19\
                Foreign Minister Ri Yong-ho declared that North Korea might
                conduct a nuclear airburst test of a hydrogen bomb over the
                Pacific. \20\

        \19\ Will Ripley, ``North Korea Revives Guam Threat Ahead of US-
    South Korea Drills,'' CNN, October 15, 2017, https://www.cnn.com/2017/
    10/13/asia/north-korea-guam-threat/index.html
        \20\ ``North Korea Ramps up Threat to Test Hydrogen Bomb over
    Pacific,'' The Guardian, October 26, 2017, https://www.theguardian.com/
    world/2017/oct/26/north-korea-threat-test-hydrogen-bomb-pacific.
    ---------------------------------------------------------------------------
        In November 2023, North Korea successfully launched its first
    military reconnaissance satellite after two previous failures.
    Pyongyang announced the satellite surveilled Anderson Air Force Base,
    Apra Harbor and other major U.S. military bases in Guam.\21\
    ---------------------------------------------------------------------------
        \21\ ``Respected Comrade Kim Jong Un Visits Pyongyang General
    Control Center of NATA,'' Korea Central News Agency, November 22, 2023,
    https://kcnawatch.org/newstream/1700640563-425435469/respected-comrade-
    kim-jong-un-visits-pyongyang-general-control-center-of-nata/.
    ---------------------------------------------------------------------------
        Threatening the U.S. Mainland. North Korea has developed a series
    of ICBMs capable of attacking the United States. In 2013, Kim was
    photographed in front of a map labelled ``U.S. Mainland Strike Plan,''
    with missile trajectories aimed at Washington, D.C.; Indo-Pacific
    Command in Hawaii; San Diego (a principal homeport of the Pacific
    Fleet); and Barksdale Air Force Base in Louisiana (home of Air Force
    Global Strike command).\22\
    ---------------------------------------------------------------------------
        \22\ Jeffrey Lewis, ``North Korean Targeting,'' Arms Control Wonk,
    April 8, 2013, https://www.armscontrolwonk.com/archive/206515/north-
    korean-targeting/.
    ---------------------------------------------------------------------------
        In 2017, North Korea conducted three successful tests of the
    Hwasong-14 (KN-20) and Hwasong-15 (KN-22) ICBMs to replace the earlier,
    less capable KN-08 and KN-14 ICBMs. The missiles were launched on
    lofted trajectories so as to not fly over Japan. Extrapolating the
    range indicated the missiles would be able to reach anywhere in the
    continental United States if launched on a regular attack trajectory.
        In October 2020, Pyongyang unveiled the Hwasong-17 ICBM, the
    world's largest mobile missile on a launch vehicle. This missile,
    larger than North Korea's previous ICBM models, may be capable of
    carrying three or four nuclear warheads. In May 2023, North Korea
    tested the Hwasong-18 solid-fueled ICBM which can be launched more
    quickly than liquid-fueled ICBMs making it more difficult for the U.S.
    to identify and target the missile. In October 2024, Pyongyang test-
    launched the Hwasong-19, an even larger solid-fuel ICBM. Since North
    Korean solid-fuel ICBMs can already target all of the continental
    United States, the reason for a larger missile would be to carry
    multiple warheads.
        Pyongyang has also revealed that it can indigenously produce mobile
    ICBM transporter-erector--launchers. The regime had previously been
    constrained in the number of ICBMs it could deploy by the small number
    of large logging vehicles purchased from China and converted to carry
    missiles. Pyongyang's ability to deploy more missiles on mobile
    launchers with multiple warheads risks overwhelming the limited U.S.
    missile defenses of 44 Ground-Based Interceptors protecting the
    American homeland.
        In June 2024, North Korea claimed the first successful test of
    multiple independently-targetable reentry vehicle (MIRV) technology
    using the first state engine of a solid-fuel hypersonic IRBM. Pyongyang
    announced that warheads were guided to three separate targets. However,
    it will likely require several additional tests of longer duration and
    higher altitude before such capability is deployed.
        North Korea has not yet conducted an ICBM flight test that
    successfully demonstrated a reentry vehicle capability. However, the
    CIA has assessed that North Korea's ICBM reentry vehicles would likely
    perform adequately if flown on a normal trajectory to continental U.S.
    targets.\23\
    ---------------------------------------------------------------------------
        \23\ Ankit Panda, ``US Intelligence: North Korea's ICBM Reentry
    Vehicles Are Likely Good Enough to Hit the Continental US,'' The
    Diplomat, August 12, 2017, https://thediplomat.com/2017/08/us-
    intelligence-north-koreas-icbm-reentry-vehicles-are-likely-good-enough-
    to-hit-the-continental-us/.
    ---------------------------------------------------------------------------
    Future Capabilities Open Dangerous Doors
        North Korea's continually advancing proficiencies suggest Pyongyang
    may be on the path to developing capabilities that go beyond deterrence
    to a viable offensive warfighting strategy. In a few years, North Korea
    could have 100-200 nuclear warheads, dozens of mobile ICBMs, and
    hundreds of improved, survivable short-range, medium-range, and
    intermediate-range missiles as well as submarine-launched missiles.
        Pyongyang could feel emboldened to use nuclear threats to coerce
    Seoul into accepting regime demands and deter the United States from
    responding. Pyongyang might also assume that conditions for military
    action had become favorable if it believed the U.S. extended deterrence
    guarantee had been undermined.
        Greater North Korean nuclear capabilities could undermine the
    effectiveness of existing allied military plans. Washington and Seoul
    could be deterred from implementing all phases of Operations Plan 5015,
    the comprehensive combined force plan for responding to large-scale
    hostilities with North Korea. The strategy includes options for
    preemptive attacks on North Korean leadership, nuclear, and missile
    targets as well as follow-on phases in which allied forces would enter
    North Korea after rebuffing initial regime attacks.
        North Korea's ability to target American cities with thermonuclear
    weapons could inhibit U.S. responses or exacerbate growing allied
    concerns about the viability of the U.S. extended deterrence guarantee.
    South Korea and Japan have already questioned the willingness of the
    United States to risk its cities for theirs.
        A more survivable North Korean nuclear force could create first-
    strike uncertainty for the United States with respect to whether it is
    able to target all of North Korea's nuclear weapons. The regime's
    ability to hold numerous American cities at risk of attack by hydrogen
    bombs could lead allies to perceive that Washington would not respond
    to North Korean actions.
    What the United States Should Do
         Affirm America's commitment to defend its allies. North
                Korea is unlikely to attack South Korea or Japan as long as
                it perceives the U.S. commitment to its allies is beyond
                doubt. Washington should make absolutely clear to friend
                and foe alike that it will defend its allies by continually
                reaffirming its extended deterrence guarantee to use all
                necessary force, including nuclear weapons, in response to
                a North Korean attack. To deter North Korean attacks,
                Washington must maintain current levels of U.S. forces in
                the region until North Korean nuclear, missile, and
                conventional force threats have been sufficiently reduced.
                Washington and Seoul should maintain extensive allied
                conventional military exercises.

         Enhance strategic defense of the American homeland. North
                Korea's growing ICBM force with potential multiple warheads
                and more launchers poses problems for American homeland
                missile defenses. The U.S. currently has only 44 Ground-
                Based Interceptors. The U.S. should augment the force to 64
                interceptors by fielding the Next Generation Interceptor
                (NGI). In addition to a necessary interceptor capacity
                increase, the NGI will have advanced capabilities that can
                address North Korea's advanced missiles more effectively.

         Augment U.S. regional ballistic missile defense.
                Pyongyang's expanding force of tactical missiles and
                submarine-launched ballistic missiles (SLBMs) increases the
                threat to U.S. forces in the Indo-Pacific region that are
                critical for responding to contingencies on the Korean
                Peninsula. Washington should assess necessary upgrades to
                defend U.S. forces, including augmenting the existing
                Terminal High Altitude Area Defense (THAAD) system on Guam,
                a critical node in U.S. regional military plans. The United
                States should deploy an Aegis Ashore system on Guam while
                simultaneously initiating an effort to improve the system
                incrementally with additional sensors and shooters.

         Ensure the effectiveness of both offensive and defensive
                deterrence. The United States and its allies must have the
                capacity not only to defend against incoming North Korean
                missiles, but also to reduce the number of missiles that
                are launched. Doing so requires comprehensive systems to
                monitor, identify, track, and target North Korean missiles,
                including mobile land-based and submarine-based versions.

         Complete modernization programs for U.S. nuclear forces.
                All components of the U.S. nuclear triad, including
                delivery systems and the warheads they carry, were built
                during the Cold War and will lose credibility due to aging
                effects if their replacements are not delivered on
                schedule. Ensuring that these modernization programs remain
                on track is essential for assuring allies of the U.S.
                commitment to extended deterrence.
    Conclusion
        North Korea has steadily improved both the quality and the quantity
    of its nuclear and missile arsenals. In recent years, Pyongyang has
    unveiled tactical and strategic missile systems that pose greater risk
    to the United States and its allies.
        The United States must ensure that it can protect the American
    homeland and U.S. forces in the Indo-Pacific region against this
    growing North Korean nuclear and missile threat. To this end,
    Washington should coordinate with South Korea and Japan to improve
    comprehensive allied missile defenses. The United States and its allies
    must also have sufficient offensive capabilities to reduce the number
    of North Korean missiles that are launched.

                                   * * * * *

    The Heritage Foundation is a public policy, research, and educational
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    Members of The Heritage Foundation staff testify as individuals
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    Foundation or its board of trustees.

                                     ______

       Questions Submitted for the Record to Mr. Bruce Klingner, Senior
           Research Fellow, The Heritage Foundation, Washington D.C.

                Questions Submitted by Representative Westerman

        Question 1. What should the United States government, including the
    Department of the Interior, prioritize from a strategic standpoint to
    counter North Korea's threats to the Pacific territories?

        Answer. The defense of Guam is critical for U.S. national security
    and its ability to project power in the western Pacific.
        As the Heritage Foundation assessed,\1\ to counter growing missile
    threats from North Korea and China, Guam needs a full-spectrum,
    permanent, 360-degree missile defense capability. While Indo-Pacific
    Command and the Missile Defense Agency have requested funding for
    improving U.S. missile defenses in the Pacific, new capabilities will
    take time to develop and deploy.
    ---------------------------------------------------------------------------
        \1\ Robert Peters, ``The Plan to Defend Guam from Missile Threats
    Is Years from Completion: More Investment Is Needed Now,'' Heritage
    Foundation Issue Brief No. 5336, January 9, 2024, https://
    www.heritage.org/sites/default/files/2024-01/IB5336.pdf.

         The MDA requested more than $800 million to design and
                build missile defense on Guam, including Lower Tier Air and
                Missile Defense Sensors, Patriot defenses, and an
                assortment of mid-range and indirect fire launchers.\2\
    ---------------------------------------------------------------------------
        \2\ Missile Defense Agency, ``Fiscal Year (FY) 2024 Budget
    Estimates Overview,'' January 2023, https://www.mda.mil/global/
    documents/pdf/MDA%20FY24%20Budget%20Booklet.pdf.

         Aegis Ashore, a missile defense capability that can track,
                engage, and destroy mid-course and terminal missile
                threats, is still years away from deployment on the island
    ---------------------------------------------------------------------------
                of Guam.

         An expanded Terminal High Altitude Area Defense (THAAD)
                systems should also be included since it provides effective
                defenses against ballistic missiles over a broad area and
                augment the existing short-range, highly effective Patriot
                (PAC-3) air defenses on Guam.

        Since this missile defense architecture will not be complete for
    years, the United States should implement a near-term, ready-to-employ
    defense. The United States should:
         Assign an Aegis Afloat capability to Guam until permanent,
                robust missile defenses are put in place, as per
                INDOPACOM's request in the Pacific Deterrence Initiative
                (PDI).

         Deploy an adequate counter-rocket, artillery, and mortar
                (C-RAM) capability to Guam to provide added defenses
                against cruise missile threats. C-RAMs are short-range
                terminal engagement systems that resemble advanced, high-
                velocity, high-capacity Gatling guns. Such systems have
                been used effectively in overseas forward operating bases
                and are well suited to defend against cruise missile
                threats. They would be an effective augmentation for PAC-3s
                when it comes to smaller enemy aircraft or sea-skimming
                cruise missiles and drones.

         Continue apace with the MDA's sequenced approach that
                integrates Patriot point defenses and THAAD, with the
                ultimate goal of the MDA providing a 360-degree missile
                defense capability on Guam.

        Question 2. Given North Korea's increased aggression in surrounding
    regions, how has the assessed threat to the U.S. Pacific territories
    changed?

        Answer. In January 2021--Kim Jong-un established a 5 year strategic
    plan for expanding and improving North Korea's nuclear and missile
    forces, including the development of:

      1.  Tactical nuclear weapons

      2.  Hypersonic glide warheads

      3.  Missiles with multiple warheads

      4.  Cruise missiles

      5.  Reconnaissance satellites

      6.  A nuclear-powered submarine and underwater-launched nuclear
                strategic weapon

      7.  Solid-fuel missiles, including ICBMs

        Each of these categories could pose a greater threat to the U.S.
    Pacific territories, particularly Guam which North Korea has repeatedly
    threatened by name.\3\ Since then, North Korea has completed or made
    substantial progress on each of these categories.
    ---------------------------------------------------------------------------
        \3\ I provided a compendium of North Korea threats to Guam in my
    prepared testimony.
    ---------------------------------------------------------------------------
    Tactical nuclear weapons
         In March 2023, Kim Jong-un displayed the ``Hwasan-31''
                tactical nuclear weapon which would augment the higher
                yield strategic nuclear weapons revealed previously. A wall
                poster behind Kim indicated that the tactical nuclear
                weapons could be fitted on eight different ground-and sea-
                based missile systems.\4\
    ---------------------------------------------------------------------------
        \4\ The KN-23, KN-24, KN-25, Hwasong-11D, Haeil underwater drone,
    the Hwasal-1 and Hwasal-2 strategic cruise missiles and an unidentified
    missile.
    ---------------------------------------------------------------------------
    Hypersonic missiles with maneuverable warheads
         The Hwasong-12 liquid-fueled intermediate-range ballistic
                missile was first tested in 2017 and demonstrated it has
                sufficient range to target the Pacific territories. The
                Hwasong-16 solid-fueled IRBM was tested during 2022-2024
                and, like the Hwasong-12, has sufficient range to target
                the Pacific territories and is assessed as capable of
                carrying nuclear warheads.
         Solid-fueled missiles, such as the Hwasong-16, are more
                difficult for the U.S. and its allies to identify and
                target since they are pre-packaged with fuel whereas
                liquid-fueled missiles require a lengthy fueling process
                out in the field, exposing them for longer periods of time
                to reconnaissance satellites and aircraft.
         Both the Hwasong-12 and Hwasong-16 have variants with a
                hypersonic wedge-shaped maneuverable glide vehicle and a
                hypersonic conical maneuverable warhead (Marv). The
                hypersonic flight path and maneuverable warheads would be
                more difficult for U.S. missile defense systems to
                intercept.
    Missiles with multiple warheads
         The Hwasong-17 liquid-fueled and Hwasong-19 solid-fueled
                ICBMs are assessed as capable of carrying multiple nuclear
                warheads, though they would likely be targeted on the
                continental United States.
         However, in 2024, North Korea conducted the first test of
                a multiple independently targetable re-entry vehicle (MIRV)
                using the first stage of a Hwasong-16 intermediate--range
                ballistic missiles. Pyongyang announced that the warheads
                successfully targeted three separate targets and the
                missile also had a decoy system to make interception more
                difficult.
         Potentially, Hwasong-16 missiles could target the Pacific
                territories with multiple nuclear warheads in addition to
                maneuverable hypersonic warheads.
    Cruise missiles (ground-and sea-launched)
         Beginning in 2021, North Korea has tested the Hwasal-1 and
                Hwasal-2 strategic long--range ground-launched cruise
                missiles with sufficient range to reach the Pacific
                territories. These missiles have been launched from an
                experimental missile submarine, a new warship and ground-
                based vehicles.
         In 2023, Pyongyang first tested the Bulwhasal-3-31 sea-
                launched cruise missile.
         The Hwasal and Bulwhasal missiles would be capable of
                carrying nuclear warheads.
    Military reconnaissance satellite
         After several unsuccessful attempts, North Korea
                succeeded in 2023 in launching the Malligyong-1
                reconnaissance satellite on Chollima-1 rocket. Pyongyang
                announced the satellite surveilled Anderson Air Force Base,
                Apra Harbor and other major U.S. military bases in Guam.
    Nuclear-powered submarine
         In September 2023, North Korea displayed what it claimed
                was ``a Korean-style tactical nuclear attack submarine,''
                however most analysts assess it is actually a diesel/
                electric--powered sub since it was an old Romeo submarine
                which had its hull lengthened. The submarine has 10
                 launch tubes--four tubes for launching
            submarine-launched ballistic missiles and 6 tubes for launching
            land-attack cruise missiles.
         In March 2025, Kim Jong-un inspected a ``nuclear-powered
                strategic guided missile submarine'' under construction.
                Pyongyang may have gained nuclear-propulsion technology
                from Moscow. The submarine is much larger than the
                submarine revealed in 2023 and may have 10 launch tubes for
                submarine-launched ballistic missiles.
    Underwater attack systems
         In 2023 and 2024, North Korea tested the Haeil-1, Haeil-2,
                and Haeil 5-23 underwater nuclear strategic attack weapon
                system which can be fitted with nuclear weapons. In some
                tests, the system cruised for 59 hours in an oval pattern.
                Pyongyang claims the system can stealthily attack allied
                ships and create a ``radioactive tsunami.''

                                     ______

        Mr. Hurd. Thank you very much, Mr. Klingner, for that
    testimony. The Chair now recognizes Mr. Francisco Bencosme for
    5 minutes.
        Mr. Bencosme.

             STATEMENT OF FRANCISCO BENCOSME, FORMER CHINA
              POLICY LEAD, U.S. AGENCY FOR INTERNATIONAL
                     DEVELOPMENT, WASHINGTON, D.C.

        Mr. Bencosme. Thank you, Chairman Hurd, Ranking Member
    Leger Fernandez, and members of the Subcommittee for the
    opportunity to testify before you today.
        Earlier this year, I ended my appointment as the China
    Policy Lead for the USAID. And prior to that I was the deputy
    for the compact negotiations, which we worked closely with the
    Subcommittee to negotiate and ultimately pass. I have been
    asked to focus my remarks on the impact of closing USAID has
    had on the Pacific Islands for peace and security, and I will
    make three points.
        First is that presence matters to compete with our
    adversaries. The United States is at risk of ceding its
    influence in the Pacific Islands and repeating the same
    mistakes we failed to learn after World War II. The PRC has
    stepped into our breach, and has exploited the United States's
    absence. In response we spent the last 6 years saying the
    United States would be intensifying our engagement in the
    region, and we did so. USAID announced it was opening its
    office in Suva, Fiji, and established a country representative
    in Papua New Guinea. We also upped our diplomacy by opening up
    new embassies in the region.
        USAID was our ground game for strategic competition, a key
    alternative to China's Belt and Road Initiative. While
    diplomats would focus on high-level diplomacy, USAID would
    reach out to local communities and demonstrate American support
    in a tangible way. USAID programs were visible signs of U.S.
    leadership expanding in the Pacific Islands, oftentimes working
    alongside our military and diplomats. Gutting foreign
    assistance limits our ability to influence and address the
    challenges in the Pacific. The sudden U.S. withdrawal from
    programs in the Pacific, where we co-funded with our allies and
    withdrew without consulting or notifying them, leaves multiple
    partners and allies in the lurch. It is the United States, not
    the PRC, that now runs the risk of being seen as unreliable and
    unpredictable.
        The perfect example is Taiwan. In 2019 Taiwan enjoyed six
    diplomatic alliances with Pacific island nations. That number
    went down to three in just 5 years, not only due to Taiwan's
    expertise on development issues, but also because it helped
    expand its international space. USAID established the Pacific
    and American Fund, a 5-year, multi-year project co-funded with
    Taiwan that benefited eight Pacific Island countries by
    providing grants on resilience, food security, access to water,
    health, education, and natural resource management. This was
    USAID's signature area of cooperation with Taiwan in the
    region.
        While China is signing new alarming development deals with
    the Cook Islands, and threatening peace and stability in the
    Tasman Sea against our allies, Australia and New Zealand,
    Washington is withdrawing from the region. In the last couple
    of years the U.S. started to invest in the region with an
    affirmative economic agenda to compete with China. For example,
    USAID partnered with Australia and Japan to support the
    development of an undersea spur cable, Palau's second, that
    will connect the country to the world's longest undersea cable
    and increase the Internet bandwidth needed to spark greater
    economic growth. Undersea cables are also central to strategic
    competition, given the potential for the cable to be used for
    espionage and to cut off vital nodes of communication.
        Second, climate change also remains an existential threat
    for the Pacific. Sea level rise continues to be above the
    global average, and ocean heating and acidification are
    threatening to harm ecosystems and livelihoods. For many
    Pacific Island countries, this is the single greatest threat to
    the people of the PICs. In recent years USAID had announced
    multiple climate initiatives, including the Pacific Islands
    Climate Finance Activity to strengthen the capacity of the
    PICs, to increase access to and improve the management of
    financing and investments to support climate change mitigation.
        Interconnected but also distinct is the propensity of
    natural disasters. The Pacific island countries are one of the
    most natural disaster-prone regions in the world, and the
    compacts designated USAID to be the main agency responsible for
    disaster response. With the demolition of USAID, no other U.S.
    agency has the authority, expertise, capacity, or resources to
    respond to a natural disaster in the Pacific. We are one
    natural disaster away from the U.S. ceding one of the places
    where we had a comparative advantage in the Pacific Islands.
        Finally, food security also remains a challenge in the
    Pacific Islands as the region faces the triple burden of
    malnutrition combined with poverty, climate change impacts,
    which compounds food and malnutrition insecurity risk.
        As the PRC, which has the largest deep sea fleet with
    17,000 vessels, the majority of which operate in the Pacific,
    one factor is illegal, unreported, and unregulated fishing.
    USAID was working closely with NOAA to support the civilian
    capacity of our partners so they can at least detect and
    counter unreported fishing. Destroying a crucial national
    security tool, the trust of our allies, basically overnight has
    not made the United States safer, stronger, and more
    prosperous. It does not put America first. It puts the People's
    Republic of China first and our Pacific prosperity and security
    last. Thank you.

        [The prepared statement of Mr. Bencosme follows:]
      Prepared Statement of Francisco Bencosme, Former China Policy Lead,
                   U.S. Agency for International Development

        Thank you Chairman Hurd, Ranking Member Leger Fernandez, and
    members of the Subcommittee for the opportunity to testify before you
    today and provide my views on threats to peace and security in the
    Pacific Islands. Earlier this year, I ended my appointment as the China
    Policy Lead for the U.S. Agency for International Development (USAID),
    where my team and I worked to align our U.S. development priorities in
    relation to strategic competition with the People's Republic of China.
    Prior to that, I worked closely with this Committee as the Deputy to
    the Compact of Free Association (COFA) negotiations at the Department
    of State, to codify $7.1 billion in economic assistance to the Freely
    Associated States.
    U.S. Leadership in the Pacific
        The United States has unilaterally disarmed one of the three
    pillars of our national security tools--defense, diplomacy, and
    development--by dismantling the U.S. Agency for International
    Development, and causing irreparable damage to our standing in the
    Pacific.
        The United States is at risk of ceding its influence in the Pacific
    Islands and repeating the mistakes we failed to learn after World War
    II. Our partners in the Pacific are calling it our ``yo-yo'' policy
    toward the region.\1\ We spent the last six years saying the United
    States would be intensifying our engagement in the region, and we did
    so, only to now pull back our U.S. presence on the ground and self-
    sabotage our influence.\2\ Gutting foreign assistance limits our
    ability to influence and address challenges in the Pacific, especially
    around topics such as Pacific regionalism, strategic competition,
    economic resilience, climate change, disaster response, and food
    security.
    ---------------------------------------------------------------------------
        \1\ The ``yo-yo'' comment was made to me by a senior Pacific Island
    official in preparation for this testimony.
        \2\ Reuters, Biden vows U.S. commitment to Pacific Islands at
    summit, September 29, 2022, https://www.yahoo.com/news/bidens-pacific-
    strategy-heralds-engagement-130027512.html
    ---------------------------------------------------------------------------
        The Pacific Islands countries do not want a ``militarized''
    competitive approach to the region and are extremely sensitive to great
    power competition undermining their sovereignty.\3\ However, in order
    to project power across the Pacific and have access to the skies and
    seas we need to win the hearts and minds of the Pacific. In the Pacific
    community, there is no distinction between hard power and soft power,
    and instead the two are intertwined. For example, in the 2018 Boe
    Declaration, the Pacific Community embraced a broader definition of
    ``security inclusive of human security, humanitarian assistance,
    prioritizing environmental security, and regional cooperation in
    building resilience to disasters and climate change''.\4\ USAID was
    pivotal to responding to these security threats. USAID was working side
    by side with our diplomats and military officers to help the United
    States project power across the Pacific.\5\
    ---------------------------------------------------------------------------
        \3\ Fiji Times, Waqa: Climate change single greatest threat, June
    25, 2024, https://www.fijitimes.com.fj/waqa-climate-change-single-
    greatest-threat/
        \4\ Boe Declaration on Regional Security/Pacific Islands Forum
    Secretariat, September 05, 2018, https://forumsec.org/publications/boe-
    declaration-regional-security
        \5\ Post Courier, High Level U.S. delegation arrives in PNG_Post
    Courier, July 15, 2024, https://www.postcourier.com.pg/high-level-us-
    delegation-arrives-in-png/
    ---------------------------------------------------------------------------
        Presence matters. USAID was the ground-game for strategic
    competition. While diplomats would focus in the halls of power, USAID
    would reach out to local communities and demonstrate American support
    in a tangible way. USAID announced it was opening up its office in
    Suva, Fiji and established a country representative in Papua New
    Guinea.\6\ The Department of State announced new embassies in Solomon
    Islands, Kiribati, Vanuatu, and Tonga. USAID programs are now frozen,
    and there are reports that the Trump administration will be cutting our
    diplomatic presence abroad as well.\7\ USAID programs were visible
    signs of U.S. leadership expanding in the Pacific Islands and tangibly
    helped build relationships with communities ``for the American
    people''.\8\ Our support for local organizations were oftentimes the
    only way remote communities would see tangible presence of U.S.
    leadership. To take it a step further, I worry the high-profile attacks
    on the U.S. assistance programs by the Trump Administration might have
    poisoned the well so much with our partners and with local communities
    that it might be impossible to regain their trust and to be a reliable
    provider of bilateral assistance ever again. USAID's investments in the
    Pacific Islands region were a critical part of the United States'
    vision for a free and open Indo-Pacific that contributed to greater
    global security and prosperity.
    ---------------------------------------------------------------------------
        \6\ U.S. Embassy Suva, USAID Highlights Pacific Expansion and
    Development Partnerships in Fiji_U.S. Embassy in Fiji, Kiribati, Nauru,
    Tonga, and Tuvalu, October 12, 2022, https://fj.usembassy.gov/usaid-
    highlights-pacific-expansion-and-development-partnerships-in-fiji/
        \7\ ABC News, U.S. embassies instructed to prepare for staff
    reductions: Sources_ABC News, February 12, 2025, https://
    abcnews.go.com/Politics/us-embassies-instructed-prepare-staff-
    reductions- sources/story?id=118755936
        \8\ ``For the American people'' refers to USAID's motto and
    branding on USAID assistance.
    ---------------------------------------------------------------------------
        In the past few years, the United States woke up to the
    consequences of ignoring our Pacific partners. The People's Republic of
    China stepped into our breach and exploited the United States' absence.
    There is no question that the United State's national security is
    intrinsically tied to the security and prosperity of the broader
    Pacific region, and has been since the very founding of our Republic.
    However, with the recent actions of the Trump Administration of
    dismantling our foreign assistance architecture including USAID and
    withdrawing from the Paris Accords and the World Health Organization,
    we are seen as not prioritizing the Pacific and our mutual interests
    for achieving regional security. As a Pacific power, the United States
    should demonstrate its leadership and support for our broader Pacific
    family and seek meaningful engagement and partnership with the Freely
    Associated States and the entire Pacific region.
    Partners and Allies
        The sudden U.S. withdrawal from programs in the Pacific where we
    co-funded with allies and withdrew without consulting or notifying them
    leaves multiple partners and allies in the lurch. It is the United
    States, not the PRC, that now runs the risk of being seen as
    unreliable. The Pacific Islands could face significant buyer's remorse
    for initiatives like the ``Partners in the Blue Pacific''.\9\
    Australia, New Zealand, and Japan have co-founded multiple USAID
    programs in the region and now find themselves uncertain as to not only
    the future of specific initiatives but the U.S. commitment to the
    region.\10\ This also undermines our allies commitment to the region--
    as many PIC partners or recipients will wonder why they should accept
    in the future ``latticework'' forms of aid if political upheaval could
    paralyze support for their development needs.\11\
    ---------------------------------------------------------------------------
        \9\ UK Statement on Establishing the Partners in the Blue Pacific
    (PBP): joint statement_GOV.UK, June 25, 2022, https://www.gov.uk/
    government/news/joint-statement-on-the-establishment-of-the-partners-
    in-the-blue-pacific-pbp
        \10\ A good example is the Palau undersea cable who's future is
    uncertain; The United States Partners with Australia and Japan to
    Expand Reliable and Secure Digital Connectivity in Palau_United States
    Department of State; October 29, 2022, https://2017-2021.state.gov/the-
    united-states-partners-with-australia-and-japan-to-expand-reliable-and-
    secure-digital-connectivity-in-palau/
        \11\ Latticework refers to the Biden's Administration Indo-Pacific
    strategy use of the phrase; ``We will pursue this through a latticework
    of strong and mutually reinforcing coalitions.'' U.S.-Indo-Pacific-
    Strategy.pdf, https://bidenwhitehouse.archives.gov/wp-content/uploads/
    2022/02/U.S.-Indo-Pacific-Strategy.pdf
    ---------------------------------------------------------------------------
        Both because it is in our U.S. interest and because it offers
    resilience against the PRC, the United States had been bolstering
    Pacific regionalism--a regionalism consistent with our interests and
    values. The first-ever Pacific Partner Strategy elevated regionalism as
    a central goal stating ``The Pacific Islands are stronger when regional
    institutions are strong. The United States will continue to support the
    Pacific Islands Forum (PIF), ensuring it remains at the center of the
    regional architecture.'' \12\ USAID was central to supporting Pacific
    regionalism, for example by working with the Pacific Islands Forum
    Secretariat to provide funding to support the Implementation Plan for
    the 2050 Strategy for the Blue Pacific Continent.\13\ USAID worked hard
    to leverage its strong partnerships with key regional institutions,
    including the Pacific Islands Forum, the Secretariat of the Pacific
    Regional Environment Programme, and the Pacific Community to drive
    development progress.\14\ This comes as the PRC has been dividing
    Pacific Island countries unity, and exerting its influence at the last
    Forum to change the language in the official communique to remove
    mentions of Taiwan.\15\
    ---------------------------------------------------------------------------
        \12\ U.S. Embassy Canberra Press Release, FACT SHEET: President
    Biden Unveils First-Ever Pacific Partnership Strategy_U.S. Embassy &
    Consulates in Australia, September, 22, 2022, https://au.usembassy.gov/
    fact-sheet-president-biden-unveils-first-ever-pacific-partnership-
    strategy/
        \13\ Archived Press Release on Pacific Island, Online by Gerhard
    Peters and John T. Woolley, The American Presidency Project, FACT
    SHEET: Following Through on the U.S.-Pacific Islands Partnership 53rd
    Pacific Islands Forum (PIF) Leaders Meeting in Nuku'Alofa, Tonga,
    August 27, 2024, https://www.presidency.ucsb.edu/documents/fact-sheet-
    following-through-the-us-pacific-islands-partnership-53rd-pacific-
    islands-forum
        \14\ Ibid
        \15\ Gordon Peake, Ph.D.; Camilla Pohle; Andrew Scobell, Ph.D., At
    Pacific Islands Forum, Tensions Flare Over Taiwan, Geopolitics and
    Climate/United States Institute of Peace; September 05, 2024, https://
    www.usip.org/publications/2024/09/pacific-islands-forum-tensions-flare-
    over-taiwan-geopolitics-and-climate
    ---------------------------------------------------------------------------
    Taiwan
        Three of Taiwan's 12 remaining diplomatic allies are Pacific Island
    nations--the Marshall Islands, the Republic of Palau, and Tuvalu. In
    2019, Taiwan enjoyed six diplomatic alliances with Pacific Island
    nations.\16\ That number went down to three in just five years. Not
    only due to Taiwan's expertise on development issues but also because
    it helped expand its international space, USAID established the Pacific
    American Fund, a five-multi-year project, co-funded with Taiwan, that
    benefited eight Pacific Island countries--including the FAS, by
    providing grants on community resilience, food security, access to
    water, health, education, good governance, and natural resources
    management. This was USAID's signature area of cooperation with Taiwan
    in the region and a key deliverable for the U.S.-Taiwan partnership
    dialogue.\17\
    ---------------------------------------------------------------------------
        \16\ Alayna Parlevliet, Support Threefold: Taiwan's Pacific Island
    Allies/New Perspectives on Asia/CSIS; July 17, 2024, https://
    www.csis.org/blogs/new-perspectives-asia/support-threefold-taiwans-
    pacific-island-
    allies#::text=In%202019%2C%20Taiwan%20enjoyed%20six%20diplomatic
    %20alliances%20with,September%202019%2C%20four%20days%20after%20the%20So
    lomon%20 Islands.
        \17\ American Institute of Taiwan, U.S.-Taiwan Cooperation on
    International Development and Humanitarian Assistance_American
    Institute in Taiwan; November 04, 2022, https://www.ait.org.tw/us-
    taiwan-cooperation-on-international-development-and-humanitarian-
    assistance/
    ---------------------------------------------------------------------------
    Strategic Competition
        The People's Republic of China will take advantage of the U.S.
    withdrawal. The People's Republic of China's influence in the Pacific
    has grown substantially in the last two decades. The PRC's objectives
    in the region include establishing a security presence in the region,
    influencing the region's voting power at the United Nations, and
    gaining access to the region's rich natural resources such as gold,
    nickel, critical minerals and fish, and isolating Taiwan's remaining
    diplomatic partners. While Xi Jinping's signature initiative--the Belt
    and Road Initiative--elevates global development as a legacy
    initiative, President Trump seeks to dismantle the United States' own
    development agency.
        By elevating international development and trade, the PRC
    established partnerships with several Pacific Island countries, notably
    the Solomon Islands and Kiribati. This is on top of the PRC's expansion
    of it's Belt and Road projects into the Pacific Islands which often
    meant leveraging development and building of dual-use port and airport
    facilities, including in Vanuatu and the Solomons, and deepening dual-
    use agreements with the Cook Islands and Kiribati to extend its
    security interest in the region. These projects include visible
    economic projects such as ports, roads, sports facilities, government
    facilities, and regional conference venues. This also coincided with
    tourism and high-level government official visits.
        According to the Lowy Institute's Pacific Aid Map, the PRC total
    aid spending rose to $256 million in 2022.\18\ This puts the PRC as the
    second-largest bilateral aid donor, though still behind Australia but
    ahead from Japan, New Zealand, and the United States.\19\ According to
    the recent numbers, the PRC has also transitioned from a loan-
    infrastructure player to a grant-based donor in the Pacific.\20\ Almost
    two thirds of PRC assistance to the region is now grant-based, which
    means less chance of inducing unsustainable debt and hewing closer to
    the U.S. grant-based model. Many commentators believe that PRC
    influence comes exclusively in the form of infrastructure deals and,
    while that has been a main feature of analysis for the first decade of
    BRI investment, the PRC has adapted and pivoted in some regions to
    ``smaller'' projects and in other sectors.\21\ Their assistance now
    takes the form of modular renewable energy projects, vehicle donations,
    agricultural equipment for farmers, cash grants to schools.\22\ The PRC
    has also flexed its humanitarian assistance via their military
    responding to the volcano eruption in Tonga and tsunami disaster in
    2022 as well.\23\ The PRC's assistance also comes in the shape of
    people-to-people engagements, for example, as the PRC pledged 2500
    government scholarships and 3000 short-term professional trainings to
    Pacific candidates between 2020 and 2025. In other words, the PRC is
    stepping up, and the U.S. has now unilaterally abandoned the field.
    ---------------------------------------------------------------------------
        \18\ Alexandre Dayant, Riley Duke, Nasirra Ahsan, Roland Rajah,
    Herve Lemahieu, Pacific Aid Map: 2024 Key Findings_Lowy Institute
    Pacific Aid Map; Lowy Institute, November 19, 2024, https://
    pacificaidmap.lowyinstitute.org/analysis/2024/key-findings/
        \19\ Ibid
        \20\ Ibid
        \21\ Victor Chen, China's strategic shift to `small but beautiful'
    projects/The Strategist, November 27, 2024, https://
    www.aspistrategist.org.au/chinas-strategic-shift-to-small-but-
    beautiful-projects/
        \22\ Renew Econo, Australia to invest $125m in Pacific island off-
    grid and community scale renewables/RenewEconomy, November 16, 2024,
    https://reneweconomy.com.au/australia-to-invest-125m-in-pacific-island-
    off-grid-and-community-scale-renewables/
        \23\ Reuters, China, West rush tsunami relief supplies to tsunami-
    hit Tonga/Reuters, January 26, 2022, https://www.reuters.com/world/
    asia-pacific/china-west-rush-tsunami-relief-supplies- tsunami-hit-
    tonga-2022-01-27/
    ---------------------------------------------------------------------------
        Meanwhile, recent events in the South Pacific where the Chinese
    People's Liberation Army Navy (PLAN) launched live-fire exercises in
    the Tasman Sea without any warning to the Australian or New Zealand
    governments has sent alarm bells across the region.\24\ Maybe most
    concerning has been the muted response from Washington. At a time when
    our partners and allies need U.S. resolve U.S. leadership has been
    absent. The live-fire exercises demonstrated the PRC's power projection
    abilities in the South Pacific, normalize PLAN's presence, and signal
    to Australia and New Zealand that the PRC is flexing its naval muscles.
    ---------------------------------------------------------------------------
        \24\ Anne-Marie Brady, A Shot Across the Bow: China Signals New Era
    of Sea Power in the Southwest Pacific, The Diplomat, February 28, 2025,
    https://thediplomat.com/2025/02/a-shot-across-the-bow-china-signals-
    new-era-of-sea-power-in-the-southwest-pacific/
    ---------------------------------------------------------------------------
        Deeply concerning has been the uptick of attacks by the PRC on
    USAID's work. Last April, I reported to my leadership that the PRC
    Ministry of Foreign Affairs issued a 20-page attack on USAID's work,
    offering up a litany of false claims about how the United States had
    ``acted recklessly, committed numerous misdeeds and committed numerous
    crimes.'' \25\ In 2023, Chinese and Russian state-backed media spread
    disinformation before the 2024 general election in the Solomon
    Islands.\26\ This came as the safety of some of our partners on the
    ground were put at risk. The false claims suggested that USAID planned
    to incite riots and orchestrate ``color revolutions''. Many of these
    same talking points have recently been parroted and lobbed domestically
    against USAID as justifications for its dismantlement.
    ---------------------------------------------------------------------------
        \25\ Chinese Ministry of Foreign Affairs, The Hypocrisy and Facts
    of the United States Foreign Aid_Ministry of Foreign Affairs of the
    People's Republic of China, April 19, 2024, https://www.mfa.gov.cn/
    mfa_eng/xw/wjbxw/202405/t20240530_11344003.html
        \26\ U.S. Embassy in Papua New Guinea Press Release, Disinformation
    Regarding our Election Partnership with the Solomon Islands_U.S.
    Embassy to Papua New Guinea, Solomon Islands, and Vanuatu, April 15,
    2024, https://pg.usembassy.gov/partnership-with-solomon-islands/
    ---------------------------------------------------------------------------
    Economic Resilience
        The United States cannot compete with the Belt and Road Initiative
    with nothing to offer. In the last couple of years, the United States
    started to invest in the region with an affirmative economic agenda for
    a free and open region. It is with this in mind that USAID joined the
    U.S.-Federal States of Micronesia Joint Economic Management Committee
    to offer an economic development perspective to our allies given the
    important role that economic security has now become a national
    security issue. Regionally as well USAID started to invest more on
    economic resilience. This included key sectors like telecommunications,
    supply chains, fisheries, and infrastructure where the PRC was
    significantly growing its presence. For example, in Palau, USAID
    partnered with Australia and Japan to support the development of an
    undersea spur cable--Palau's second--that will connect the country to
    the world's longest undersea cable and increase the internet bandwidth
    needed to spark greater economic growth.\27\ This was administered and
    funded by USAID's Transaction Advisory Fund (TAF), a Trump
    Administration priority program in its first term, which served as a
    ``rapid response'' program to fund legal, engineering, and technical
    design services for strategic infrastructure projects in key
    sectors.\28\ Undersea cables are also central to U.S.-PRC strategic
    competition--given the potential for cables to be used for espionage
    and to cut off vital nodes of communications.\29\
    ---------------------------------------------------------------------------
        \27\ Department of State Press Release, The United States Partners
    with Australia and Japan to Expand Reliable and Secure Digital
    Connectivity in Palau_United States Department of State, October 29,
    2022, https://2017-2021.state.gov/the-united-states-partners-with-
    australia-and-japan-to-expand-reliable-and-secure-digital-connectivity-
    in-palau/
        \28\ Department of State website, Infrastructure Transaction
    Advisory Services_United States Department of State, https://
    www.state.gov/development-finance/taf
        \29\ Joe Brock, U.S. and China wage war beneath the waves_over
    internet cables; March 24, 2023, https://www.reuters.com/investigates/
    special-report/us-china-tech-cables/
    ---------------------------------------------------------------------------
        Another key undersea cable program funded by TAF includes the East
    Micronesia undersea cable. This internet cable would have connected
    Kosrae in Micronesia, Nauru, and Tarawa in Kiribati with the existing
    cable in Pohnpei providing faster, higher quality, and more secure
    internet connectivity through a submarine cable.\30\ This had the
    potential to connect 100,000 people across three Pacific Island
    countries for the first time.\31\ In the Marshall Islands, USAID
    provided technical assistance for the country to modernize its
    telecommunications sector. This helped expand RMI's digital
    connectivity to remote areas for the time and provide the entire
    country with more reliable, faster, and secure internet access.\32\
    ---------------------------------------------------------------------------
        \30\ AIFFP, Improving digital connectivity in the Federated States
    of Micronesia, Kiribati and Nauru via submarine cable/The Australian
    Infrastructure Financing Facility for the Pacific (AIFFP), https://
    www.aiffp.gov.au/investments/investment-list/improving-digital-
    connectivity-in-the-federated-states-of-micronesia-kiribati-and-nauru-
    via-submarine-cable
        \31\ Ibid
        \32\ Marianas Business Journal, U.S. suspends foreign aid for 90
    days, potentially affecting Micronesia/Marianas Business Journal,
    January 28, 2025, https://mbjguam.com/us-suspends-foreign-aid-90-days-
    potentially-affecting-micronesia
    ---------------------------------------------------------------------------
        This included leveraging market power and private sector investment
    in the region. For example, USAID established a $50 million
    microfinance facility for micro-, small, and medium-sized enterprises;
    while also launching a program to support public financial management
    and domestic resource mobilization; facilitate greater trade and
    private investment; and improve business resiliency in the Pacific
    Islands region.\33\ USAID also helped leverage a public-private sector
    partnership in the fisheries sector so that Pacific Island countries
    can more directly benefit from the global tuna value chain. This
    included a partnership between USAID, the Development Finance
    Corporation, in partnership with the Australians in the fishery sector
    in the Marshall Islands.\34\
    ---------------------------------------------------------------------------
        \33\ Australia_Pacific Islands Business Council, U.S. announces
    initiatives to boost trade, finance in Pacific_Australia Pacific
    Islands Business Council, May 27, 2024, https://apibc.org.au/news/us-
    announces-initiatives-to-boost-trade-finance-in-pacific/
        \34\ Relief Web, News Press Release, USAID Announces Additional
    Support to Pacific Island Countries_Fiji/ReliefWeb, October 04, 2024,
    https://reliefweb.int/report/fiji/usaid-announces-additional-support-
    pacific-island-countries
    ---------------------------------------------------------------------------
        In the Solomon Islands, USAID worked with partners at all levels to
    advance the country's economic competitiveness and inclusiveness, with
    specific emphasis on developing the agribusiness sector and improving
    natural resources governance.\35\ Finally, USAID even worked hard to
    expand new partners like MASHAV, Israel's development agency, to the
    region in the form of a joint project focused on human capital
    development through knowledge transfer and capacity building.\36\ This
    focused on community resilience, digitization, and water management
    throughout the Pacific.
    ---------------------------------------------------------------------------
        \35\ U.S. Mission to Papua New Guinea, USAID's SCALE Project
    Supports Agriculture in Malaita_U.S. Embassy to Papua New Guinea,
    Solomon Islands, and Vanuatu, December 19, 2022, https://
    pg.usembassy.gov/usaids-scale-project-supports-agriculture-in-malaita/
        \36\ Nabilah, Tech In Pacific News, Israel and USAID Launch
    Partnership with Fiji_Tech In Pacific, August 31, 2024, https://
    www.techinpacific.com/israel-and-usaid-launch-partnership-with-fiji/
    ---------------------------------------------------------------------------
        With the dismantling of USAID, economic resilience in the region is
    now at greater risk from PRC predatory practices, where the PRC has
    used economic coercion as a weapon against Pacific Island nations in
    the past. President Whipps of Palau has stated the PRC weaponized
    tourism as a form of economic coercion as punishment for continuing to
    recognize Taiwan.\37\ Supporting U.S. allies and partners economically
    to diversify their economies is not just a good economic strategy but
    also a matter of national security. Just as the United States was
    rising to meet the challenge posed by the PRC economically in the
    region--we are now withdrawing.
    ---------------------------------------------------------------------------
        \37\ Charlotte Graham-McClay, Associated Press, China is
    weaponizing lucrative tourism over his refusal to break Taiwan ties,
    Palau's president says/AP News, August 16, 2024, https://apnews.com/
    article/palau-china-surangel-whipps-beijing-pacific-influence-
    045ec0a4f8e67e48d2a4adf0cbd13918
    ---------------------------------------------------------------------------
    Climate Change
        Climate change remains an existential threat for the Pacific
    Islands. Sea level rise continues to be above the global average and
    ocean heating and acidification are threatening to harm ecosystems and
    livelihoods.\38\ For many Pacific Island countries this is the ``single
    greatest threat'' to the people of the PICs, as shown at the 49th
    Pacific Island Forum's Boe Declaration in 2018.\39\ At the COP26 United
    Nations climate summit, the Tuvalu Foreign Minister, Mr. Simon Kofe
    delivered a speech, while standing ankle-deep in water, stating that
    when it comes to addressing climate change, ``there really are no good
    guys and bad guys.'' \40\ This past year, the Pacific Island Forum
    secretary general stated very clearly ``Geopolitical manoeuvring means
    nothing to Pacific peoples who have cyclones coming over the horizon .
    . . Geopolitical manoeuvring means nothing to Pacific peoples who have
    water lapping at their doorsteps due to sea level rise . . .
    Geopolitical manoeuvring means nothing to Pacific peoples who are
    focused on building resilience, peace and prosperity for our families,
    communities, nations and our region''.\41\
    ---------------------------------------------------------------------------
        \38\ World Meteorological Program, Press Release, Climate change
    transforms Pacific Islands, August 27, 2024,
        \39\ Boe Declaration on Regional Security/Pacific Islands Forum
    Secretariat, September 05, 2018, https://forumsec.org/publications/boe-
    declaration-regional-security
        \40\ Tuvalu minister says both China, U.S. needed for climate
    change action/Reuters
        \41\ Fiji Times, Waqa: Climate change single greatest threat, June
    25, 2024, https://www.fijitimes.com.fj/waqa-climate-change-single-
    greatest-threat/
    ---------------------------------------------------------------------------
        In recent years, USAID had announced the Pacific Islands Climate
    Finance Activity to strengthen the capacity of the Pacific Island
    Countries--including the FAS--to increase access to and improve
    management of financing and investments to support climate change
    mitigation and adaptation efforts.\42\ We also announced the expansion
    of Papua New Guinea (PN) Electrification Partnership through the
    Pacific Islands. This expanded energy access in the rest of the Pacific
    Islands through a multilateral partnership with Australia, Japan, and
    New Zealand--and was an example of how we leveraged small amounts of
    U.S. investment and multiplied it with U.S. partners and allies.\43\
    With rising sea levels, increased flooding, and stronger tropical
    cyclones, the Pacific Islands are on the frontlines of the climate
    crisis. Accurate weather forecasting is as important as ever in the
    light of this reality, as it gives communities time to prepare,
    potentially saving lives. Now this top priority for the PICs has been
    abandoned by the Trump Administration removing climate change
    vocabulary, pulling out of multilateral fora, and withdrawing support
    to phase this existential crisis.
    ---------------------------------------------------------------------------
        \42\ USAID Press Release, The United States announces more than $10
    million in additional support at the Pacific Islands Forum
    DevelopmentAid, August 29, 2024, https://www.developmentaid.org/news-
    stream/post/184226/usa-support-at-the-pacific-islands-forum
        \43\ Department of State Press Release, Joint Statement on the
    United States_Papua New Guinea Strategic Partnership Dialogue, October
    14, 2024, https://2021-2025.state.gov/joint-statement-on-the-united-
    states-papua-new-guinea-strategic-partnership-dialogue/
    ---------------------------------------------------------------------------
    Natural Disasters
        The Pacific Island countries are one of the most natural disaster
    prone regions in the world.\44\ Disaster related events are both
    seasonal and cyclical, with the small size, remoteness, and fragile
    biodiversity making them exceptionally vulnerable.\45\ The Compacts,
    codified by this Committee, designated USAID to be the main agency
    responsible for disaster response to all three Freely Associated
    States. With the demolition of USAID, no other U.S. agency has the
    authority, expertise, capacity, or resources to respond to a natural
    disaster in the Pacific. Prior to recent events, USAID funded an
    existing network of warehouses with pre-positioned relief supplies and
    recovery materials.\46\ Pre-positioning supplies has proven to be much
    cheaper and more efficient than bringing resources after a disaster has
    struck.\47\ Given the extremely remote location of these islands and
    their outer-island populations, response planning must include
    preparedness, pre-positioning, and qualified and trained staff able to
    provide the response.\48\ This emergency assistance provided life-
    saving shelter, WASH, and non-food items via the prepositioning.\49\
    Being able to have relief readily accessible and appropriate can make
    all the difference in a disaster life-saving response.
    ---------------------------------------------------------------------------
        \44\ United Nations Office of Coordination for Humanitarian
    Affairs, Pacific Islands/OCHA, https://www.unocha.org/pacific
        \45\ Robert Guild and Hanna Uusimaa, Asia Development Bank,
    Disaster Risk Reduction and Management in the Pacific, August 2013,
    https://www.adb.org/sites/default/files/publication/30374/disaster-
    risk-reduction-management-pacific.pdf
        \46\ Reuters, Pacific Islands to build climate disaster warehouses/
    Reuters, August 08, 2024, https://www.reuters.com/world/asia-pacific/
    pacific-islands-build-climate-disaster-warehouses-2024-08-09/
        \47\ Ibid
        \48\ Ibid
        \49\ USAID Medium Post, Preparing the Pacific Islands. 6 ways USAID
    is strengthening early . . . /by USAID/U.S. Agency for International
    Development/Medium, October 25, 2024, https://medium.com/usaid-2030/
    preparing-the-pacific-islands-aede762f0461
    ---------------------------------------------------------------------------
        Further, USAID, through it's partner Catholic Relief Services,
    strived to enhance the capacity of RMI and FSM to more effectively
    prepare for and manage disaster and climate-related risks by supporting
    locally led responses to small to medium scale disasters.\50\ By
    introducing disaster-resilient agricultural techniques and establishing
    village savings and lending groups in outer-island communities to allow
    individuals outside of the banking system to have access to savings
    during family or community-wide shocks. In addition, USAID would have
    supported a collaborative initiative through the International
    Organization for Migration that brings together disaster response
    authorities in the Philippines and select Pacific Island nations to
    share best practices, strategies, and identify and address gaps in
    disaster preparedness and response.\51\ Regionally, as part of its
    Partners in the Blue Pacific initiative, the United States announced
    USAID assistance to bolster the Pacific Islands' ability to detect and
    respond to natural disasters.\52\
    ---------------------------------------------------------------------------
        \50\ Testimony for Craig Hart, USAID Bureau for Asia Deputy
    Assistant Administrator House Committee on Foreign Affairs,
    Subcommittee on Indo-Pacific ``Renewed U.S. Engagement in the Pacific:
    Assessing the importance of the Pacific Islands'', Microsoft
    Word_WRITTEN 2023 0314_HFAC COFA Hearing for DAA Hart (1), March 23,
    2023, https://www.congress.gov/118/meeting/house/115525/witnesses/HHRG-
    118-FA05-Wstate-HartC-20230323.pdf
        \51\ USAID Press Release, The United States Announces More Than $10
    Million in Additional Support at the Pacific Islands Forum_Fiji/
    ReliefWeb, August 28, 2024, https://reliefweb.int/report/fiji/united-
    states-announces-more-10-million-additional-support-pacific-islands-
    forum
        \52\ Ibid
    ---------------------------------------------------------------------------
        USAID's three-pronged approach--to enhance emergency response
    systems, improve disaster preparedness, and strengthen first-responder
    capabilities--promoted self-reliance, enabling partner countries to
    lessen the impacts of natural hazards and respond more effectively to
    disasters, has been largely abandoned. For the first time in three
    decades, three tropical cyclones are ravaging through the South
    Pacific.\53\ If they hit any of our Pacific partners, the United States
    would have no capacity to respond to the crisis if called upon. If it
    hits our Freely Associated States allies, the United States could
    potentially be in violation of the COFA agreement and the law. The
    United States expertise and capacity to respond to humanitarian
    disaster was unrivaled--it was an invaluable tool of U.S. leadership
    vis-a-vis the PRC--where we clearly had unparalleled advantage, now all
    squandered.
    ---------------------------------------------------------------------------
        \53\ Ben Noll, Washington Post, Three tropical cyclones churn in
    South Pacific_all at once_The Washington Post; February 25, 2025,
    https://www.washingtonpost.com/weather/2025/02/25/tropical-cyclones-
    alfred-rae-seru-south-pacific/
    ---------------------------------------------------------------------------
    Food Insecurity and Illegal, Unreported, and Unregulated Fishing
        Food insecurity remains a real challenge in the Pacific Islands--as
    the region faces the triple burden of malnutrition, combined with
    poverty and climate change impacts compounds food and malnutrition
    security risks.\54\ Before the closure, USAID, in partnership with
    Australia and New Zealand, launched the Pacific Vision for Adapted
    Crops and Soils initiative which would have built more climate-
    resilient food systems in Pacific island countries, in partnership with
    the Pacific Community and New Zealand.\55\ It supported regional
    Pacific efforts such as the Unlocking Blue Pacific Prosperity
    initiative to increase targeted investments in diverse, nutritious, and
    climate-adapted crops grown in healthy soils and sustainably managed
    landscapes. In partnership with the regional initiative it was also
    working with the private sector to diversify supply chains in the
    region.
    ---------------------------------------------------------------------------
        \54\ FAO. 2021. Poverty, malnutrition and food security in Pacific
    Small Island Developing States. Bangkok with the Pacific Community and
    New Zealand.
        \55\ Archived Press Release on Pacific Island, Online by Gerhard
    Peters and John T. Woolley, The American Presidency Project, FACT
    SHEET: Following Through on the U.S.-Pacific Islands Partnership 53rd
    Pacific Islands Forum (PIF) Leaders Meeting in Nuku'Alofa, Tonga,
    August 27, 2024, https://www.presidency.ucsb.edu/documents/fact-sheet-
    following-through-the-us-pacific-islands-partnership-53rd-pacific-
    islands-forum
    ---------------------------------------------------------------------------
        USAID also ran a program called ``Our Fish Our Future'' initiative
    which partners with the University of Rhode Island to support the
    management of critical fisheries and ecosystems.\56\ By supporting the
    management of critical fisheries and ecosystems, the project sought to
    improve food security and maintain tuna stocks, a key economic resource
    for the United States fishing industry, processing plants, and other
    American businesses downstream. American consumers eat over 1 billion
    pounds of canned tuna every year.
    ---------------------------------------------------------------------------
        \56\ University of Rhode Island Press Release, URI Coastal
    Resources Center lands $15 million to help countries, communities
    tackle unsustainable fishing practices in Pacific Islands region_Rhody
    Today, June 08, 2022, https://www.uri.edu/news/2022/06/uri-coastal-
    resources-center-lands-15-million-to-help-countries-communities-tackle-
    unsustainable-fishing-practices-in-pacific-islands-region/
    ---------------------------------------------------------------------------
        One factor in food security is illegal, unreported, and unregulated
    fishing (IUUF). In general, IUUF costs the global economy between $26
    and $50 billion annually, harming local and international
    economies.\57\ The tuna industry in the Pacific Islands, commercially
    generated $22 billion in 2012 and accounts for more than 45% of state
    revenues in most Pacific Island countries.\58\ For many Pacific Island
    countries IUUF poses an existential threat to their populations, where
    people rely on fish for 30% of their diet and more than 50% of their
    protein.\59\
    ---------------------------------------------------------------------------
        \57\ World Economic Forum, Pacific countries: data sharing can
    drive down IUU fishing/World Economic Forum, January 10, 2024, https://
    www.weforum.org/stories/2024/01/davos24-pacific-countries-drive-down-
    illegal-fishing/
        \58\ Tony Long and Amanda Nickson, Illegal Fishing Costs Pacific
    Islands Millions Annually in Lost Tuna Revenue, May 02, 2016, https://
    www.pewtrusts.org/en/research-and-analysis/articles/2016/05/02/illegal-
    fishing-costs-pacific-islands-millions-annually-in-lost-tuna-revenue
        \59\ Joseph Hammond, Chinese Fishing Fleet Poses Threat to Pacific
    Island Economies, Indo-Pacific Defense Forum, 21 Jun 2021, available at
    https://ipdefenseforum.com/2021/06/chinese-fishing-fleet-poses-threat-
    to-pacific-island economies/.
    ---------------------------------------------------------------------------
        Combatting IUUF in the Pacific Islands also helps protect their
    national sovereignty. For example, many Pacific Islands countries do
    not have military capabilities to police their entire exclusive
    economic zones. Recent U.S. Coast Guard ship rider agreements allow PIC
    country law enforcement to patrol and improve their countries'
    enforcement capabilities.\60\
    ---------------------------------------------------------------------------
        \60\ Indo-Pacific Defense Forum Staff, Long-standing shiprider
    agreements boost Free and Open Indo-Pacific, protect EEZs, April 28,
    2024, https://ipdefenseforum.com/2024/04/long-standing-shiprider-
    agreements-boost-free-and-open-indo-pacific-protect-eezs/
    ---------------------------------------------------------------------------
        There is also a geopolitical dimension as well, as the PRC's deep
    sea fleet is the largest with almost 17,000 vessels, the majority of
    which operate in the Pacific.\61\ According to the Global Initiative
    Against Transnational Organized Crime, the PRC was ranked as the worst
    offender of IUU fishing.\62\ We will never be able to have enough U.S.
    Coast Guard fleet to compete with the PRC's fleet--however USAID and
    other environmental agencies have been supporting the civilian capacity
    of our partners so they can at least detect and counter IUUF. USAID's
    work in this crucial part of maritime security has now been gutted--
    potentially risking Pacific prosperity and security.
    ---------------------------------------------------------------------------
        \61\ Ibid
        \62\ Secretariat, Global Initiative Against Transnational Crime,
    IUU Fishing index 2021/Global Initiative, December 24, 2021, https://
    globalinitiative.net/analysis/iuu-fishing-index-2021/
    ---------------------------------------------------------------------------
    Conclusion
        To be clear, there is nothing wrong with wanting to reform the U.S.
    foreign assistance architecture--in fact, it is much warranted.
    However, to dismantle the entire USAID system and terminate programs
    without so much an actual strategic review process is national security
    malpractice. It does not put America first. It puts the People's
    Republic of China first--and Pacific prosperity and security last.
        The policy chosen by this Administration to bulldoze first and pick
    up the pieces afterwards is nothing short of disastrous, endangering
    U.S. security and raising serious legal and constitutional questions.
    Destroying a crucial national security tool, the trust of our allies,
    and all basically overnight, has not made the United States safer,
    stronger, and more prosperous.
        Instead it strengthens the People's Republic of China and
    undermines our partnership with the Pacific Island countries. We find
    ourselves tremendously weaker due to mistakes of the past 6 weeks--
    mistakes that will take a very long time to recover from and where it
    may only be possible to mitigate the damage if large parts are reversed
    as soon as possible--and where Congress has both the power and the
    responsibility to act.

                                     ______

    Questions Submitted for the Record to Francisco Bencosme, Former USAID
                               China Policy Lead

    Mr. Bencosme did not submit responses to the Committee by the
    appropriate deadline for inclusion in the printed record.

                 Questions Submitted by Representative Huffman

        Question 1. Before unelected billionaire Elon Musk's indiscriminate
    and callous purge of the USAID workforce, your work directly countered
    China's expanding influence in the Pacific by supporting our allies in
    the region. Can you outline some of the critical services and programs
    USAID has provided to our allies in the Pacific? Given USAID's
    significant role, how does its dismantling create vulnerabilities that
    China is poised to exploit?

        Question 2. We have extensive documentation of the People's
    Republic of China's (PRC) illegal and coercive actions against Pacific
    Island nations--including economic pressure and cyber-attacks targeting
    the governments of Palau and the Marshall Islands. The Trump
    administration's decision to scale back the U.S. presence in the region
    has weakened our ability to counter these threats. How does this
    shortsighted retreat affect our Pacific allies' ability to resist
    Beijing's influence campaigns?

                                     ______

        Mr. Hurd. Thank you very much, Mr. Bencosme, for that
    testimony.
        I just would like to briefly note for the record that Mr.
    Bencosme was a political appointee in the previous
    administration, and had resigned prior to the start of the
    Trump administration.
        Last, but certainly not least, I want to introduce and
    recognize Ms. Cleo Paskal for 5 minutes.
        Ms. Paskal.

         STATEMENT OF CLEO PASKAL, NON-RESIDENT SENIOR FELLOW,
                FOUNDATION FOR DEFENSE OF DEMOCRACIES,
                            WASHINGTON, D.C.

        Ms. Paskal. Chairman Hurd, Ranking Member Leger Fernandez,
    thank you.
        The Pacific territories are deeply experienced at
    geopolitics. All became part of the United States as a result
    of wars or strategic contests. Today we will talk mostly about
    China and North Korea. One hundred and twenty-seven years ago
    for Guam it was Spain, then for American Samoa it was Germany
    and Britain, for CNMI it was Japan and the Soviets. By the
    1920s, once the Japanese mandate took shape in what is now CNMI
    and the FAS, it was clear that if a hostile power had control
    of the Central Pacific, America was not safe.
        Strategists talk of Mackinder's 1904 heartland theory that
    the Eurasian land mass is the geopolitical pivot, it comes down
    from the center of Russia and China, and control there
    determines the direction of the world. With evolutions in naval
    power and the battle for systems between the U.S. and China, a
    case can now be made that it is the Oceania heartland that
    determines the direction of the Indo-Pacific, if not the world.
        The strategic core of Oceania is the U.S. territories and
    the FAS. For the last 80 years, the Oceania heartland has
    mostly been a model of a free and open Indo-Pacific, benefiting
    countries worldwide. China, however, sees things differently.
    It wants to be in a position to reshape the world to its own
    liking, including being able to take the territory of other
    countries without effective opposition. We have known this for
    a while. In 2008, Admiral Keating said a senior Chinese
    official suggested to him, ``You take Hawaii East; we will take
    Hawaii West.''
        China has been pursuing its goals in ways General Brawner
    of the Philippines describes as illegal, coercive, aggressive,
    and deceptive, known by its initials as ICAD. We have seen
    extensive and pervasive disruptive PRC ICAD behavior in
    Oceania. There are many examples from my colleagues, from the
    members themselves, and in my written testimony. China knows,
    as long as the pivot of the Oceania heartland is not under its
    control, it cannot do what it wants to do in terms of expanding
    its aggression and its ambitions, including with Taiwan.
        So what can OIA do? Work both to block the threats while
    building prosperity. One won't succeed without the other. China
    uses the allure of commercial engagement with countries, but
    doesn't actually want economic engagement to lead to growth. It
    wants to create economic dependencies. So any attempts at
    building real prosperity also has to block the expected PRC
    ICAD attacks. DOI and its OIA are leads in the American
    territories.
        OIA has less than 30 people, and 2 are judges in American
    Samoa. Currently, there is no assistant or deputy assistant
    secretary. It has massive responsibilities for highly strategic
    zone. My recommendations are structured to maximize the
    efficiency and build on Chairman Hurd's opening comments.
        On blocking, Interior Secretary Burgum has a seat on the
    NSC. Perhaps this NSC role could be expanded to oversee and
    coordinate the defense and reinforcement of the Pacific
    territories and the FAS, which are America's western border, as
    part of the hemispheric defense approach being adopted by the
    Trump administration. This could be done in conjunction with
    the revitalization of the interagency group on the FAS, which
    is co-chaired by the Secretaries of the Interior and State.
    That could function to focus and reinforce efforts of OIA. OIA
    field agents could play an important block-and-build role by
    coordinating locally with other departments and with
    Washington, including the interagency, and informing via
    Secretary Burgum's office, the NSC.
        A key entry point for PRC ICAD activity is corruption. OIA
    could focus on technical assistance programs designed to
    counter corruption, waste, fraud, and abuse. The Governor of
    CNMI has repeatedly asked for Federal investigations into
    illegal activities and corruption. A few good Federal
    investigators, perhaps even reservists, might provide the
    territories and the FAS with more security than any number of
    F-35s, and make it more likely F-35s will be able to operate
    from there if required.
        Also helpful is the establishing an FBI field office on
    Guam and satellite offices in CNMI and American Samoa that can
    support counter-ICAD activities there and in the FAS. To better
    advise and coordinate, the territories could set up national
    security coordinators or councils. That is something Palau has
    done with great effect.
        In keeping with the America-first investment policy,
    attention should be paid to proposed investments from foreign
    entities. Homeland should require all those entering CNMI to
    have the same visas as those entering the rest of the U.S.
        Building requires ground-level assessments, which could be
    facilitated by OIA field agents. The three core areas to focus
    on are the costs of energy, transportation, and communications,
    all of which are prohibitively high in the territories.
        Some examples of the small things that would make a big
    difference are a waiver from cabotage, the establishment of a
    fast ferry service between Guam and Rota, hearings on the
    operations of United Airlines, work to unlock the potential of
    American Samoa fisheries, centralized tracking and oversight of
    Federal programs.
        The PRC has made its trajectory clear. It wants to control
    the Oceania heartland, and it will destroy American communities
    and families to do it. The goal of OIA should be to ensure that
    the people of the American territories can build prosperity
    without the community and security destruction caused by ever-
    present ICAD activities. As American nationals and citizens, it
    is the least they deserve. Thank you.

        [The prepared statement of Ms. Paskal follows:]
        Prepared Statement of Cleo Paskal, Non-resident Senior Fellow,
                     Foundation for Defense of Democracies

        Chairman Hurd, Ranking Member Leger Fernandez, thank you for the
    privilege and honor of being able to testify before you today on this
    important topic.
        The three Pacific territories covered by the Office of Insular
    Affairs are American Samoa, Guam, and the Commonwealth of Northern
    Mariana Islands (CNMI). Combined, they have a population of about
    250,000. All three are experiencing a rise in external threats to peace
    and security, primarily due to actions linked to the People's Republic
    of China (PRC), exacerbated by economic stress.
        This testimony details the profound importance of the territories
    to the rest of the United States (including their defensive role). The
    testimony also covers the commensurate importance to the PRC in
    undermining relations between the territories and the U.S. federal
    government in order to exert corrosive influence in the territories and
    render them less able to defend themselves, let alone the American
    mainland.
        The testimony then uses a ``block and build'' framework (blocking
    illegal, coercive, aggressive, and deceptive PRC-linked activity while
    building economic and social resilience) to make recommendations for
    how to defend against PRC attacks while fostering prosperity and
    ensuring the American nationals and citizens of the territories can
    live in peace.
    Pacific Territories' Role in National Defense
        All three territories (for a map, please see Annex 1) became part
    of the United States as a result of war or strategic concerns (for
    more, please see Annex 2). Since then, they have played an outsized
    role in the defense of the nation. Guam and CNMI make up the Mariana
    Islands, a north-south chain that is a core part of the Second Island
    Chain running from Japan through Micronesia, and form the fallback line
    of defense should the PRC take Taiwan. To get a sense of how close to
    Asia they are, the Exclusive Economic Zone of CNMI abuts that of Japan,
    and Guam is an eight-hour flight west of Honolulu and four hours east
    of Manila. American Samoa is the only part of the United States in the
    Southern Hemisphere, and Pago Pago harbor is one of the best ports in
    the Southern Pacific. It gives the United States a footprint in the
    heart of the Southern Pacific, a zone of increasing importance as PRC
    ties to Latin America grow. It is pivotal for keeping this part of the
    Indo-Pacific free and open.
        In the words of Gov. Arnold Palacios of CNMI: 1 ``The
    U.S. territories of the Northern Marianas, Guam, and American Samoa
    firmly anchor America's position in the Pacific, and together with the
    Freely Associated States, create a vast corridor of peace and security
    that spans nearly three million square miles and connects to the seas
    of other allied nations.''
        When President Ronald Reagan visited Guam in 1984, he said,
    ``[Guam] may be nearly 9,000 miles from our nation's capital, but it's
    a real pleasure to know that we're among fellow Americans . . . In
    times of crisis, few Americans have been more steadfast in the defense
    of our shared values and few have made more sacrifices to preserve
    them.'' 2 All three territories, for example, have higher
    than average enlistment rates in the U.S. military.
        Given their locations, they are also highly sensitive to strategic
    shifts, as they are on America's frontline and at the end of long
    logistics lines. Currently, Guam is home to several key U.S. military
    installations, including Naval Base Guam, Andersen Air Force Base, and
    Camp Blaz. Guam Gov. Lourdes A. Leon Guerrero, in her August 24, 2023,
    congressional testimony, explained the strategic importance of Guam:

    From 1521 to the present day, Guam has been, and continues to be, a
    linchpin of every Pacific Power. The reasons for this are simple. On
    the axis that crosses 5,000 miles of the Pacific between Hawai'i and
    Asia, Guam is the only island with a protected harbor and sufficient
    land for major airports. Guam is also the largest landfall for
    communications, shipping, and military installations on the nearly
    3,000-mile north axis from Japan to Papua New Guinea and Australia . .
    . For these reasons, Guam has played a unique and pivotal role in
    nearly every major American conflict in the late 20th and early 21st
    centuries. As a result of American engagement in [Guam and the islands
    around Guam] and the larger Pacific region, the United States won an
    unparalleled period of peace, economic trade, and shared prosperity in
    the Pacific.3

        The governor was concerned that that period was coming to an end,
    adding: ``[A]s time passed and other priorities drew America's watchful
    eye away from Pacific Island Countries, China emerged . . . because
    Guam can project power throughout the Indo-Pacific region, China is
    working to project equal power onto Guam and its sister islands.''
        Congresswoman Uifa'atali Aumua Amata Coleman Radewagen,
    representing American Samoa, has underlined the need for more U.S.
    military engagement in American Samoa, in particular the Coast Guard,
    saying:

    We need to continue to strengthen the Coast Guard's capabilities
    including total cutters, and the ability to add deployment of cutters
    to the Pacific . . . I continue to urge the strongest possible
    consideration of stationing fast cutters in American Samoa, one of the
    vast Pacific's finest harbors. This would be a powerful statement of
    U.S. commitment to the South Pacific during a time of CCP (Chinese
    Communist Party) regional efforts and influence, and the Pacific
    concerns of Illegal, Unreported, and Unregulated Fishing.4

        CNMI is seeing hundreds of millions of dollars of investments by
    the U.S. military as World War II sites, such as the North Field on
    Tinian, are rehabilitated and new training grounds are put in. At the
    February 2025 Interagency Group on Insular Affairs meeting in
    Washington, DC, CNMI Gov. Arnold Palacios said:

    Our need to be vigilant as America's front-line state in preserving the
    peace and freedom we enjoy in the Pacific as part of the American
    family really hit home with me about a month ago when the media
    reported that China had launched what was described as the `world's
    largest amphibious attack ship:' the Sichuan.
    Amphibious vessels are something we on Saipan know something about
    because it was just 80 years ago last summer that American forces came
    ashore in amphibious vessels to bring freedom to our islands and some
    of our older folks who were children at that time still vividly
    remember the American Flag coming up on the beach. So, the launching of
    the world's largest amphibious attack ship is something that makes us
    sit up and pay attention. After all, when I describe CNMI as America's
    frontline state, I mean that literally. We are the closest American
    soil to mainland China. I would be exaggerating to say Shanghai is
    swimming distance from our northern most island but it is just 1,630
    miles away and it would not take all that long for a new warship to get
    there.

        As mentioned by leaders in American Samoa, Guam, and CNMI, a major
    concern is the People's Republic of China. CNMI and Guam, along with
    the relationship between the United States and the Freely Associated
    States (FAS) (Palau, the Federated States of Micronesia (FSM), and the
    Republic of the Marshall Islands), ensure that the United States has a
    ``corridor of freedom,'' including freedom of deployment secured with
    strategic denial, through the central Pacific to the First and Second
    Island Chains, including treaty ally the Philippines and American bases
    in Japan. It functionally pushes the U.S. Pacific defense perimeter off
    the coast of Asia, guaranteeing the safety of Americans in Guam and
    CNMI and underpinning free trade for all nations across the central
    Pacific.
    External Threats to Peace and Security
        For those who have a different vision of the Pacific, this is a
    problem. In 2022, details of the PRC comprehensive plan to gain
    influence, if not control, in as many Pacific Islands as possible was
    seen in the texts of its proposed China-Pacific Island Countries Common
    Development Vision and China-Pacific Island Countries Five-Year Action
    Plan on Common Development (2022-2026).
        Elements of the Vision 5 and Plan 6 included
    cooperation on law enforcement, customs, inspections, quarantine,
    network governance, cyber security, laboratory construction used for
    fingerprint testing, forensic autopsy, drugs, electronic and digital
    forensics, supporting airlines to operate air routes and flights
    between China and Pacific Island Countries, the possibility of a China-
    Pacific Island Countries Free Trade Area, thousands of government
    scholarships, and establishing a ``China-Pacific Island Countries
    Disaster Management Cooperation Mechanism,'' including a prepositioned
    ``China-Pacific Island Countries Reserve of Emergency Supplies.''
        Combined, the Vision and Plan are a blueprint for extraordinary
    control in sovereign countries. For example, it would put the PRC in a
    position to move people and supplies with limited external oversight
    and to infiltrate investigation and prosecution operations, stymying
    the rule of law and attempts to counter illegal PRC activities that can
    lead to bribery, coercion, and military prepositioning. This was clear
    to then FSM President David Panuelo when he wrote about the Vision and
    Plan: ``All of this, taken together, is part of how China intends to
    form a `new type of international relations' with itself as the
    hegemonic power and the current rules-based international order as a
    forgotten relic. That's a direct quote, I should emphasize a `new type
    of international relations'--and an explicit goal on behalf of China
    from the Common Development Vision.'' 7
        Some elements of the Vision and Plan are already in place, and they
    demonstrate how fundamentally different Beijing's vision is for the
    future of the region--one in which Beijing's rules take precedence
    rather than the rule of law. The degree to which rights and democracy
    have been eroded in the Solomon Islands under PRC pressure is a case in
    point, with those opposed to increased PRC influence in the country
    being targeted--including one elected member of a provincial
    legislature having his elected seat taken away for not recognizing
    China's definition of the One China Policy.8
        This has been building for a while. In 2008, Adm. Timothy Keating
    said a senior Chinese official suggested to him: ``You take Hawaii
    east. We'll take Hawaii west. We'll share information, and we'll save
    you all the trouble of deploying your naval forces west of Hawaii.''
    9 For the PRC, the key to pushing the United States back to
    Hawaii is undermining the relationship with the territories and the
    Freely Associated States (FAS)--much in the same way that the Japanese
    Mandate (1921-1944) that covered CNMI and what are now the FAS was a
    problem for American forces trying to dislodge Imperial Japan.
        The People's Liberation Army (PLA) has studied the Pacific War.
    It's unlikely to be accidental that, when the PRC gains a foothold in a
    Pacific nation, it tries to secure real estate that was strategic in
    World War II, for example, Tulagi in the Solomon Islands.10
    According to Dr. Toshi Yoshihara's Chinese Lesson from the Pacific War:
    Implications for PLA Warfighting: ``The Pacific War covered a
    geographic expanse that roughly overlaps with areas where the PLA would
    likely fight in the coming years. China's Rocket Force now boasts long-
    range missiles that can reach Guam, while its diplomats are attempting
    to secure access across the Pacific Islands, the bloody battlegrounds
    of the Pacific War.''
        It's not just PRC diplomats. The CCP and its proxies use a range of
    methods, including public and private loans, bribery, blackmail,
    coercion, investment, and influence, to advance their interests. This
    has included outright attempts at the destruction of a country if
    breaking it into pieces is seen as advantageous. (This is consistent
    with PRC unrestricted and ``disintegration'' warfare.) 11
    According to President Panuelo, the PRC has been involved in backing
    separatist movements in the FSM: ``It is not a coincidence that the
    common thread behind the Chuuk State secession movement, the Pohnpei
    Political Status Commission and, a to lesser extent, the Yap
    independence movement, include money from the PRC and whispers of PRC
    support.'' 12
        Often an approach is ``braided,'' with three mutually reinforcing
    strands: commercial, strategic, and criminal elements.13
    Chinese organized crime is often a part of PRC operations in the
    Pacific islands. They bribe, enforce, smuggle, blackmail, and more.
    While largely free to make their own money and develop their own
    networks, Chinese criminals do so with the understanding that they must
    be useful to Beijing when required.14 As per China's 2017
    National Intelligence Law, every Chinese citizen and organization is
    legally obligated to support the government's intelligence
    operations.15
        The U.S. territories (in particular CNMI and Guam) and the FAS have
    been targets of multi-year, broad-spectrum political warfare attacks
    that seek to overwhelm them and open the path for conditions more
    friendly to the PRC.16 As President Panuelo put it, one of
    the tactics is bribery: ``we are bribed to be complicit, and bribed to
    be silent . . . The practical impact of this is that some senior
    officials and elected officials take actions that are contrary to the
    FSM's national interest, but are consistent with the PRC's national
    interest.'' 17
        One of those interests, Panuelo writes, is: ``China is seeking to
    ensure that, in the event of a war in our Blue Pacific Continent
    between themselves and Taiwan, that the FSM is, at best, aligned with
    the PRC (China) instead of the United States, and, at worst, that the
    FSM chooses to `abstain' altogether.'' 18
        In Guam or CNMI, a goal along those lines might be to make U.S.
    forces unwelcome or to push for independence.19 This is not
    to say there aren't legitimate concerns about U.S. military activity or
    the relationship with the federal government but that those concerns
    can be exploited and distorted by outside actors who don't have the
    best interest of locals at heart.
    [GRAPHIC] [TIFF OMITTED] T9555.008

    PRC-Linked Activity in CNMI
        In CNMI, from 2009, PRC nationals have been allowed to enter CNMI
    without visas as required in the rest of the United
    States.20 According to CNMI Gov. Arnold Palacios' August
    2023 congressional testimony,21 due to the need for economic
    development: ``We turned to Chinese gambling, legalizing casino gaming
    on Saipan even after the venture previously failed on Tinian. An
    exclusive license was nevertheless awarded to a Chinese casino
    operation that has been mired in litigation and criminal investigation
    practically from the start . . . The Chinese casino on Saipan at its
    peak raked in billions of US dollars in monthly rolling chip volumes
    from just 16 VIP tables, outdoing even the glitziest casinos in
    Macau.''
        This boosted the economy but also, according to Palacios, ``was
    fraught with controversy--from human trafficking to birth tourism,
    labour abuse, money laundering, and public corruption.'' Chinese have
    been found traveling illegally to Guam by boat (and roaming on military
    installations), using the U.S. postal service to distribute illegal
    drugs, selling illegal drugs, and buying U.S. driver's
    licenses.22 There is no similar link to such extensive
    criminal activity with any other single nationality in CNMI.
        There has also been the appearance of PRC-linked businesses in
    strategic locations where there is little commercial justification. For
    example, a Chinese-linked casino opened on Tinian's dual--use harbor.
    Tinian has a population of around 2,000 and relatively little tourism.
    Unlike the previous casino on Tinian, it wasn't part of a hotel, was
    open irregular hours, and visibly didn't prosper. However, it opened at
    a time when the U.S. military was spending hundreds of millions
    resurrecting old airfields on the island, with at least some of that
    activity passing in front of the casino. It shut down in December
    2024.23
        Regardless, there is continuous pressure for more access from China
    into CNMI, including attempts to get the Department of Transportation
    to lift the cap on direct flights from China to CNMI.24 The
    argument is that the CNMI needs more tourists, specifically Chinese
    ones. There is a conspicuous lack of alternatives offered--for example,
    offering similar EVS-TAP 25 entry conditions to Indian
    tourists and business people or pushing for changes to cabotage to make
    things easier for the Japanese market.26 The default is
    always China, China, China. And those who question it are attacked in
    the media and online,27 in addition to real-world
    intimidation such as the slashing of car tires.
        The narrative warfare is pervasive. Glen Hunter, CNMI special
    assistant for broadband policy development, wrote:

    [G]roups and influencers in the CNMI have transitioned over the past
    decade to oppose military development due to concerns about
    environmental damage and cultural loss. However, these same influencers
    have readily embraced large-scale investments backed by the CCP, such
    as garment factories and casinos, without expressing similar concerns
    about potential societal, environmental, and cultural impacts on the
    islands. This double standard highlights a paradoxical stance where
    resistance is shown against U.S. military presence due to perceived
    negative consequences while simultaneously endorsing extensive Chinese
    enterprise development without similar scrutiny.28

        This dominance by PRC-linked pressure groups is also rumored to be
    a factor in dissuading investors from other countries from entering
    CNMI. Officials and locals have repeatedly raised concerns about PRC-
    linked practices destabilizing the local economy and placing undue
    pressure on CNMI's social cohesion.29 Hunter also wrote:

    ``The governor's commitment to this pivot [away from Chinese tourists]
    is a significant setback for the CCP, limiting their ability to use the
    CNMI as a stepping stone to expand their influence throughout Pacific
    Island nations. In response, China has predictably increased its
    efforts to destabilize our economy, hoping to force a change in our
    administration's stance or if unsuccessful a change in the
    administration itself.'' 30

    PRC-linked Activity in Guam
        Guam has seen many of the activities described above, with the
    addition of being the target of PRC-linked cyberattacks on its critical
    infrastructure, a serious security concern given the role of the
    American bases in defending the region.31
        It is also the target of information warfare, with a constant
    stream of messaging designed to create insecurity in the population
    that could lead to breaks with the federal government. For example, PRC
    media has called China's DF-26 ballistic missile the ``Guam Killer,''
    32 feeding the narrative of those who ask why should Guam
    put itself at risk for the rest of the United States--especially given
    dissatisfaction with the nature of the relationship.
        According to Guam Gov. Leon Guerrero, the counter is: ``Some say
    that by allowing the U.S. military to base in Guam, we are making
    ourselves a target. That's nonsense. We are a target because of
    geography. And I'd much prefer the U.S. military be here than the
    Chinese military.'' 33
        Debate is healthy--and American. So is transparency and more
    openness about funding sources for narratives in order to be helpful
    for an informed electorate.
    PRC-linked Activity in American Samoa
        At a February 13, 2025, House Foreign Affairs Committee hearing,
    Congresswoman Radewagen said: ``In the past two weeks, independent
    Samoa and the Cook Islands have signed deals with the PRC. With
    Kiribati to the north, independent Samoa to the east, and Cook Islands
    to our east, my home district of American Samoa is now surrounded on
    three sides by China-friendly nations.'' 34
        Among the specific new concerns for American Samoa is the signing
    of a visa waiver agreement between independent Samoa and China that
    will allow for an increase in unvetted arrivals next door.35
    Already, there is substantial PRC citizen-related crime in independent
    Samoa. One recent letter to the editor of the Samoa Observer captured a
    common sentiment:
        [T]here are growing concerns about the hidden operations of Chinese
    nationals in various sectors. Some are allegedly secretly operating
    rentals, serving as agents for customs and immigration, and even acting
    as tax agents. There have also been rumours of Chinese nationals
    establishing a political presence in Samoa . . . it is becoming evident
    that some Chinese nationals may be arming themselves with weapons for
    protection. This raises concerns about the potential for further
    violence, and I fear that Samoa is becoming a breeding ground for
    criminal activity, influenced by external actors who do not have our
    best interests at heart.36
        American Samoa additionally has issues with illegal, unreported,
    and unregulated fishing that, given the economic potential of the
    fisheries, is a major concern.37
    What To Do? Block and Build.
        The basic framework is a ``Block and Build'' 38 approach
    in which Chinese behavior that is illegal, coercive, aggressive, and
    deceptive (ICAD--as Philippines General Romeo Brawner calls
    it39) is blocked while simultaneously building domestic,
    economic, and legal security. Given the advanced state of PRC ICAD
    activity, especially in Guam and CNMI, one must assume that any major
    projects designed to provide economic, political, or security
    independence (build), especially ones that make them less reliant on
    China, will be targeted by PRC agents and slowed down through a range
    of tactics. Unless that targeting is blocked, it will be hard to build.
    Given the goals of the PRC, its ICAD activity should be countered and
    attacked with the same focus and vigor that is directed toward
    preparing for future kinetic warfare. The PRC has made its trajectory
    clear. Failing to address Chinese aggression in America's Pacific
    homeland now will make the likely eventual confrontation with the PRC
    more difficult and more costly.
        This is a whole-of-government effort. However, the U.S. Department
    of the Interior's mandate regarding the territories and the FAS gives
    it a leadership position. Interior Secretary Doug Burgum has a seat on
    the National Security Council (NSC) due to his position as head of the
    National Energy Council.40 Perhaps, this NSC role could be
    expanded to oversee and coordinate the defense and reinforcement of the
    Pacific territories and the FAS--America's Western border--as part of
    the hemispheric defense approach being adopted by the Trump
    administration.
        That approach could function to focus and reinforce efforts of the
    Office of Insular Affairs (OIA). For example, OIA has a field agent in
    each territory; however, their role is vague. Instead, OIA field agents
    could play a greater block and build role by coordinating locally with
    other departments and with Washington--including the interagency--and
    informing, via Secretary Burgum's office, the NSC. Historically, OIA
    has been ``low key''--at best, reactive in times of crises. With more
    coordination and information flows, and direction from Secretary
    Burgum, the chances of getting ahead of issues improve. Some
    suggestions on how to do that at a more tactical level are below.
    Block
        A key entry point for PRC ICAD is corruption. The territories (and
    the FAS) are not equipped to investigate and counter this scale and
    complexity of penetration on their own. The U.S. territories (and the
    FAS) urgently need assistance to investigate and prosecute illegal
    activities, in particular, strategic corruption. Currently, there is
    little downside to selling out to the PRC and significant economic and
    social downsides for those who take a stand. There is a pervasive
    atmosphere of fear in these tight-knit societies, so investigators and
    prosecutors would ideally come in from outside the region. At this
    point, a few good investigators and aggressive lawyers might provide
    the territories (and the FAS) with more security than any number of F-
    35s.
        OIA could focus on technical assistance programs designed to
    counter corruption, waste, fraud, and abuse. It could also coordinate
    with other relevant government departments. There is a lot to work
    with. For example, the Federal Bureau of Investigation has an enormous
    amount of data taken from the Saipan offices of the Hong Kong-based
    casino operator Imperial Pacific International during their searches in
    relation to illegal activities.41 It is perplexing why no
    major changes have been made.
        Other departments have a role to play as well, ideally, in
    coordination with Interior. For example, Interior and the Department of
    Defense could develop a clear reporting mechanism for ICAD activity.
    Once the scope is determined, others could be included through the
    interagency process to counter, including in the FAS.
        Regardless, for any defense plan to be accurate, the Department of
    Defense would need to include countering ICAD in its plans for
    assessing and countering threats in the territories (and the FAS).
    Counters could include the Department of Defense substantially
    increasing the appropriate U.S. military presence in the territories--
    including deploying reservists who can help with combating strategic
    corruption--and, in particular, establish a permanent Coast Guard
    presence in American Samoa. This isn't about numbers; this is about the
    right people for the job at hand.
        Other sample blocking actions that could be encouraged and/or
    coordinated through Interior:

         The Department of Homeland Security should require all
                tourists entering CNMI to have the same visas as tourists
                entering the rest of the United States.

         Immigration and Customs Enforcement could publish records
                showing the numbers of foreigners entering CNMI and Guam
                without exiting when their visas expire.

         The State Department could raise concerns with Samoa about
                the visa waivers for PRC nationals affecting American
                Samoa.

         As recommended by Gov. Leon Guerrero,42 the
                territories could be supported in setting up national
                security coordinators/councils--and perhaps a regional
                council--to better advise and coordinate, including on
                countering ICAD threats. There are examples of PRC
                criminals who enter Palau using CNMI IDs. Fragmentation of
                the security environment benefits this sort of
                transnational criminality.

         In keeping with the America First Investment Policy
                43 and as proposed by Alexander Gray:
                ``Departments of Commerce, Treasury, Labor and appropriate
                regulatory bodies must pay particular attention to proposed
                projects and investments from foreign entities in U.S.
                Pacific territories.'' Also: ``Given the scale of PRC
                operations in the Western Pacific, an additional [FBI]
                field office on Guam and satellite offices, appropriately
                manned, in CNMI and American Samoa would support both
                defensive efforts but also assist in wider-regional
                intelligence and counterintelligence operations with
                Pacific Islands partners.'' 44 The FAS could
                also coordinate with that office.

    Build
        At the same time, proper attention should be paid to finding ways
    to keep the territories economically and socially healthy. This
    requires ground-level assessments, which perhaps could be facilitated
    by OIA field agents.
        One example of a `small' thing that would make a big build
    difference is a waiver from cabotage.45 Currently, only
    American carriers can fly between U.S. destinations. That has resulted
    in United having an effective monopoly on the Saipan to Guam route, and
    resulting airfares are some of the highest per mile in the world--with
    a 40-minute round trip flight costing around $580. This has put severe
    constraints on CNMI's ability to diversify tourism and develop
    alternative business, and it raises healthcare and education costs.
    Waiving cabotage would mean, for example, that a Japanese carrier could
    fly Tokyo-Saipan-Guam, lowering costs and opening up new markets.
    Indeed, United's role in the region as a whole deserves serious
    attention.
        Other sample build actions:

         Removing bureaucratic barriers to accelerate federally
                funded programs (including around FEMA support post-
                disasters) and implementing centralized tracking and
                oversight of these programs.

         Establishing a center, possibly at the Northern Marianas
                College, that works with the elders and local practitioners
                to research and educate on the political evolution of the
                region, including the Japanese era through the Trust
                Territory and onto the establishment of CNMI and the FAS.
                This is necessary so that narratives aren't hijacked by
                malign external actors, the region rebuilds its bonds, and
                those from Interior, State, Defense, and others who work in
                the area get an understanding of the unique nature of the
                region.

         Working to unlock the potential of the American Samoan
                fisheries. Along with the economic growth that fisheries
                can offer the people of American Samoa, it would bring
                friendly fleets into Samoan waters, putting it in a better
                position to observe and defend against those in Samoan
                waters with ill intent.

         Prioritizing the establishment of a fast ferry service
                between Guam and Rota to bring in military tourists and
                improve connectivity. This can offer travel options and
                growth to the people of Rota while forestalling the allure
                of PRC investment in a location so close to Guam.

        Fundamentally, the goal of all of this is to ensure that the cost/
    benefit analysis of taking Chinese money to sell out your country
    changes and that the people of the American territories are given a way
    to prosper without ever-present illegal, coercive, aggressive, and
    deceptive activity by the PRC destroying their communities, dividing
    their families, and making them live in fear. As American nationals and
    citizens, it's the least they deserve.
    ANNEX 1: Map of the Pacific Territories
    [GRAPHIC] [TIFF OMITTED] T9555.009

    ANNEX 2: A Brief Look at How American Samoa, Commonwealth of
            Northern Mariana Islands and Guam Came to Be Part of the United
            States
        While there are cultural and familial links across the Pacific
    territories, they have different modern histories and different legal
    relationships with the federal government. A basic understanding of
    these differences is an essential starting point not only to provide
    acceptable and effective outcomes but also because these differences
    can be exploited by powers keen to sow discord within the American
    family, for example, over the status of Guam.

              Selected Timeline of U.S. Relations With American Samoa
    ------------------------------------------------------------------------

    ------------------------------------------------------------------------
    1872...................................  Commander Richard W. Meade,
                                              United States Navy, agrees to
                                              a treaty with the leadership
                                              on Tutuila Island giving the
                                              United States exclusive rights
                                              to develop a naval station at
                                              Pago Pago harbor. The U.S.
                                              Senate, in an isolationist
                                              phase, refuses to ratify. The
                                              islanders consider it
                                              binding.46
    ------------------------------------------------------------------------
    1878...................................  Following a visit by Ambassador
                                              Chief Mamea to the United
                                              States, the Senate ratifies
                                              the Treaty for a Naval Station
                                              in Pago Pago but passes on
                                              annexing the islands.47
    ------------------------------------------------------------------------
    1899...................................  Tensions between Britain,
                                              Germany, and to a degree the
                                              United States and the Kingdom
                                              of Hawaii 48 contribute to
                                              Samoan civil wars. Britain,
                                              Germany, and the United States
                                              sign the Tripartite Convention
                                              giving Samoan islands east of
                                              the 171st meridian (including
                                              Tutuila) to the United States
                                              and the ones to the west to
                                              Germany.49
    ------------------------------------------------------------------------
    1900...................................  Presidential Executive Order
                                              125-A places American Samoa
                                              under U.S. Navy jurisdiction.
                                              Formal deeds of cession of
                                              Tutuila to the United States
                                              are signed by the Matai
                                              (Chiefs), obligating the
                                              United States to preserve
                                              local cultural traditions.50
    ------------------------------------------------------------------------
    1904...................................  Tui Manu'a signs a deed of
                                              cession of Manu'a to the
                                              United States.51
    ------------------------------------------------------------------------
    1925...................................  Swain Island is added by
                                              Congress to the boundaries of
                                              American Samoa.52
    ------------------------------------------------------------------------
    1929...................................  The United States formally
                                              ratifies deeds of cession,
                                              authorizing the president to
                                              administer relations
                                              consistent with cultural
                                              autonomy in local affairs.53
    ------------------------------------------------------------------------
    1951...................................  Authority of the president for
                                              relations with American Samoa
                                              is delegated to the secretary
                                              of the interior by executive
                                              order.54
    ------------------------------------------------------------------------
    1956...................................  Secretary of the Department of
                                              the Interior appoints American
                                              Samoa-born Peter Tali Coleman
                                              as the territory's first Samoa
                                              governor of Samoan descent. He
                                              later also serves as the first
                                              locally elected governor.55
    ------------------------------------------------------------------------

        With approvals by the secretary of the interior, the 1960 locally
    adopted constitution was revised in 1967 and 2025 based on local self-
    determination.
        Today, American Samoa's political status is that of an
    unincorporated territory of the United States, uniquely governed as
    authorized by congressional ratification of the deeds of cession,
    delegating federal authority to the president, delegated in turn to the
    secretary of the interior. This status is defined by a unique history
    in which American Samoa was never conquered, annexed, or sold by the
    legal mandate of colonial powers.
        Instead, the islands retain a legacy of sovereign-to-sovereign
    mutual agreement devolving to the United States sovereignty at a
    national level and federal relations-based preservation of cultural
    autonomy and self-determination as to local affairs. Accordingly,
    American Samoans choose to preserve statutory `national but not
    citizen' status for purposes of international travel and migration to
    the U.S. mainland and the option of reclassification as statutory
    ``citizens'' by individual choice. American Samoa also has petitioned
    the United Nations to remove it from the UN Charter Article 73 list of
    colonial areas.
        While this status means Samoans can't, for example, vote for
    president, the status is generally seen favorably, as it affords them
    other benefits, such as protection for their own system of land
    management.56 It sends an elected representative to Congress
    who serves, votes, and holds leadership position in the U.S. House of
    Representatives and committees thereof.

                   Selected Timeline of U.S. Relations With Guam
    ------------------------------------------------------------------------

    ------------------------------------------------------------------------
    June 20-21, 1898.......................  Guam had been part of the
                                              Spanish colonial empire since
                                              the 17th Century. The United
                                              States captures Guam as part
                                              of the Spanish-American War.57
    ------------------------------------------------------------------------
    December 10, 1898......................  The Treaty of Paris ends the
                                              Spanish-American War. Spain
                                              cedes Guam, along with the
                                              Philippines and Puerto Rico,
                                              to the United States.58
    ------------------------------------------------------------------------
    December 8-10, 1941....................  Within hours of the attack on
                                              Pearl Harbor, Imperial
                                              Japanese forces attacked Guam,
                                              taking it shortly after and
                                              occupying it until 1944.
    ------------------------------------------------------------------------
    July 21 to August 10, 1944.............  Liberation of Guam by U.S.
                                              forces.
    ------------------------------------------------------------------------
    August 1, 1950.........................  For most of its time under the
                                              United States, Guam was
                                              administered by the U.S. Navy.
                                              On this day, President Harry
                                              Truman signs the Organic Act
                                              of Guam, designating it an
                                              unincorporated organized
                                              territory of the United
                                              States, granting statutory
                                              U.S. citizenship to its
                                              inhabitants, establishing a
                                              civilian government with a
                                              legislature and governor, and
                                              transferring federal
                                              jurisdiction to the Department
                                              of the Interior.59
    ------------------------------------------------------------------------
    1969...................................  Voters in Guam reject
                                              unification with Northern
                                              Mariana Islands.60
    ------------------------------------------------------------------------
    1976-8.................................  Guam is authorized to establish
                                              its own constitution.61 A
                                              constitutional convention is
                                              held, and a draft Constitution
                                              is written.
    ------------------------------------------------------------------------
    1979...................................  In a referendum, 82 percent of
                                              Guamanian voters reject the
                                              proposed constitution, and the
                                              territory remains subject to
                                              the 1950 Organic Act.62
    ------------------------------------------------------------------------

        Guam is an organized, unincorporated territory. Its residents are
    U.S. citizens but cannot vote in presidential elections. It also sends
    an elected representative to Congress.

         Selected Timeline of U.S. Relations With Commonwealth of Northern
                                 Mariana Islands
    ------------------------------------------------------------------------

    ------------------------------------------------------------------------
    1944...................................  U.S. forces take Saipan and
                                              Tinian, expelling Imperial
                                              Japanese forces from the
                                              Northern Mariana Islands
                                              (NMI).
    ------------------------------------------------------------------------
    1947...................................  United Nations Security Council
                                              establishes the ``strategic''
                                              Trust Territory (which
                                              includes NMI and what are now
                                              Palau, the Federated States of
                                              Micronesia and the Republic of
                                              the Marshall Islands) and it
                                              is given to the United States
                                              to administer.63
    ------------------------------------------------------------------------
    1951...................................  Administration of the Trust
                                              Territory (including NMI) is
                                              transferred by President Harry
                                              Truman through an executive
                                              order from the Navy to
                                              Interior.64
    ------------------------------------------------------------------------
    1965...................................  Convening of the Congress of
                                              Micronesia in Saipan.65
    ------------------------------------------------------------------------
    1975...................................  Referendum votes in favor of
                                              becoming a U.S. territory in
                                              political union with the
                                              United States.66
    ------------------------------------------------------------------------
    1976...................................  The current ``Commonwealth
                                              Covenant'' is signed into law
                                              by President Gerald Ford.67
    ------------------------------------------------------------------------
    1986...................................  The United States terminates
                                              the Trust Territory agreement,
                                              and CNMI residents become U.S.
                                              citizens.68
    ------------------------------------------------------------------------

        CNMI is an organized, unincorporated territory with commonwealth
    status. Its residents are U.S. citizens but cannot vote in presidential
    elections. It too sends an elected representative to Congress.

                                     *****

    ENDNOTES

        1 Gov. Arnold I. Palacios, ``Peace Through Strength: The Strategic
    Importance of the Pacific Islands to U.S.-led Global Security,''
    Testimony before the U.S House Committee on Natural Resources, August
    24, 2023. (https://governor.gov.mp/news/oral-testimony-of-governor-
    arnold-i-palacios-commonwealth-of-the-northern-mariana-islands)
        2 Former U.S. President Ronald Reagan, ``Remarks on Arrival at Guam
    International Airport in Agana,'' In response to remarks by Gov.
    Ricardo J. Bordallo, April 25, 1984. (https://www.reaganlibrary.gov/
    archives/speech/remarks-arrival-guam-international-airport-agana)
        3 Gov. Lourdes A. Leon Guerrero, ``Peace Through Strength: The
    Strategic Importance of the Pacific Islands to U.S.-led Global
    Security,'' Testimony before the House Committee on Natural Resources,
    August 24, 2023. (https://naturalresources.house.gov/uploadedfiles/
    gov.--guerrero--testimony.pdf)
        4 Congresswoman Uifa'atali Aumua Amata Coleman Radewagen, Press
    Release, ``Amata Highlights Presidential Order, and Suggests Coast
    Guard Cutter Stationed at Pago Pago Harbor,'' January 24, 2024.
    (https://radewagen.house.gov/media-center/press-releases/amata-
    highlights-presidential-order-and-suggests-coast-guard-cutter)
        5 @CleoPaskal, Twitter, May 26, 2022. (https://twitter.com/
    CleoPaskal/status/1529867665992474626)
        6 @CleoPaskal, Twitter, May 26, 2022. (https://twitter.com/
    CleoPaskal/status/1529849187071926273)
        7 Former President of Micronesia David W. Panuelo, ``To FSM
    leaders,'' Letter to the 22nd FSM Congress, FSM Governors, and
    leadership of FSM state legislatures, March 9, 2023. (https://
    www.fdd.org/wp-content/uploads/2023/11/President-Panuelo-Letter-9-
    March-2023-to-FSM-leaders-on-political-warfare.pdf)
        8 Cleo Paskal, ``Daniel Suidani's arrest in the Solomons proves CCP
    is scared,'' The Sunday Guardian (India), October 13, 2024. (https://
    sundayguardianlive.com/investigation/daniel-suidanis-arrest-in-the-
    solomons-proves-ccp-is-scared)
        9 Donna Miles, ``China Requires Close Eye as It Expands Influence,
    Capability,'' American Forces Press Service, March 12, 2008. (https://
    www.dvidshub.net/news/17315/china-requires-close-eye-expands-influence-
    capability)
        10 Damien Cave, ``Chinese Lease of Entire Island Is Deemed Illegal
    in Solomons,'' The New York Times, October 24, 2019. (https://
    www.nytimes.com/2019/10/24/world/australia/solomon-islands-china-
    tulagi.html)
        11 U.S. House Committee on Oversight and Accountability, Majority
    Staff, ``CCP Political Warfare: Federal Agencies Urgently Need a
    Government-Wide Strategy,'' October 24, 2024. (https://
    oversight.house.gov/wp-content/uploads/2024/10/CCP-Report-10.24.24.pdf)
        12 Former President of Micronesia David W. Panuelo, ``To FSM
    leaders,'' Letter to the 22nd FSM Congress, FSM Governors, and
    leadership of FSM state legislatures, March 9, 2023. (https://
    www.fdd.org/wp-content/uploads/2023/11/President-Panuelo-Letter-9-
    March-2023-to-FSM-leaders-on-political-warfare.pdf)
        13 Cleo Paskal, ``How the Compacts of Free Association Support U.S.
    Interests and Counter the PRC's Influence,'' Testimony before the House
    Natural Resources Committee Subcommittee on Indian and Insular Affairs,
    June 14, 2023. (https://naturalresources.house.gov/uploadedfiles/
    testimony--paskal.pdf)
        14 Bernadette Carreon, Aubrey Belford, and Martin Young, ``Pacific
    Gambit: Inside the Chinese Communist Party and Triad Push into Palau,''
    Organized Crime and Corruption Reporting Project, December 12, 2022.
    (https://www.occrp.org/en/investigation/pacific-gambit-inside-the-
    chinese-communist-party-and-triad-push-into-palau)
        15 National Intelligence Law (as amended in 2018), trans. China Law
    Translate, June 27, 2017. (https://www.chinalawtranslate.com/en/
    national-intelligence-law-of-the-p-r-c-2017)
        16 Cleo Paskal, ``How the Compacts of Free Association Support U.S.
    Interests and Counter the PRC's Influence,'' Testimony before U.S.
    House Natural Resources Committee, Indo-Pacific Task Force, June 14,
    2023. (https://naturalresources.house.gov/uploadedfiles/testimony--
    paskal.pdf)
        17 Former President of Micronesia David W. Panuelo, ``To FSM
    leaders,'' Letter to the 22nd FSM Congress, FSM Governors, and
    leadership of FSM state legislatures, March 9, 2023. (https://
    www.fdd.org/wp-content/uploads/2023/11/President-Panuelo-Letter-9-
    March-2023-to-FSM-leaders-on-PRC-political-warfare.pdf)
        18 Ibid.
        19 Glen Hunter, ``LETTER: The subtle art of influence-China's
    strategic engagement in the CNMI,'' Pacific Daily News, May 24, 2024.
    (https://www.guampdn.com/opinion/letter-the-subtle-art-of-influence-
    chinas-strategic-engagement-in-the-cnmi/article--27226356-1894-11ef-
    ba26-9b67999cc1b5.html)
        20 Cleo Paskal, ``Northern Marianas: Time to close China's backdoor
    into the US,'' Pacific Island Times, September 3, 2023. (https://
    www.pacificislandtimes.com/post/northern-marianas-time-to-close-china-
    s-backdoor-into-the-us)
        21 Governor Arnold I. Palacios, ``Oral Testimony of Governor Arnold
    I. Palacios Commonwealth of the Northern Mariana Islands,'' Oversight
    Hearing of the U.S. House Committee on Natural Resources, August 24,
    2023. (https://governor.gov.mp/news/oral-testimony-of-governor-arnold-
    i-palacios-commonwealth-of-the-northern-mariana-islands)
        22 Alex Wilson, ``Chinese citizens use Northern Marianas as illegal
    pathway to Guam, authorities say,'' Stars and Stripes, February 27,
    2024. (https://www.stripes.com/theaters/asia--pacific/2024-02-26/guam-
    china-illegal-entry-northern-marianas-13130497.html); ``CNMI Customs
    confiscate $700K `ice' at post office,'' Islands Business (Fiji), March
    23, 2022. (https://islandsbusiness.com/news-break/cnmi-largest-drug-
    haul-in-five-years); U.S. Attorney's Office, Districts of Guam and the
    Northern Mariana Islands, News Release, ``Chinese Illegals: CNMI DMV
    Chief Convicted of License Fraud,'' December 18, 2023. (https://
    www.justice.gov/usao-gu/pr/bureau-motor-vehicle-chief-and-prc-citizen-
    sentenced-federal-prison-cnmi-drivers-license)
        23 Emmanuel T. Erediano, ``UPDATED (2): Tinian Diamond shuts
    down,'' Marianas Variety, December 30, 2024. (https://www.mvariety.com/
    news/local/updated-2-tinian-diamond-shuts-down/article--5833d830-c343-
    11ef-b978-1bbadaee7467.html)
        24 Rep. Kimberlyn King-Hinds, Press Release, ``Congresswoman King-
    Hinds Urges Department of Transportation to Reinstate Annex VI of U.S.-
    China Air Transport Agreement,'' February 9, 2025. (https://king--
    hinds.house.gov/media/press-releases/congresswoman-king-hinds-urges-
    department-transportation-reinstate-annex-vi-us)
        25 Implementation of the Commonwealth of the Northern Mariana
    Islands (CNMI) Economic Vitality & Security Travel Authorization
    Program (EVS-TAP), Department of Homeland Security, U.S. Customs and
    Border Protections Agency, 90 Federal Register 658, January 6, 2025.
    (https://www.federalregister.gov/documents/2025/01/06/2024-31326/
    implementation-of-the-commonwealth-of-the-northern-mariana-islands-
    cnmi-economic-vitality-and)
        26 Glen Hunter, ``LETTER: The subtle art of influence--China's
    strategic engagement in the CNMI,'' Pacific Daily News, May 24, 2024.
    (https://www.guampdn.com/opinion/letter-the-subtle-art-of-influence-
    chinas-strategic-engagement-in-the-cnmi/article--27226356-1894-11ef-
    ba26-9b67999cc1b5.html)
        27 Zaldy Dandan, ``Rock, meet hard place,'' Marianas Variety,
    February 28, 2025. (https://www.mvariety.com/views/editorials/rock-
    meet-hard-place/article--e969a34c-f4fe-11ef-bf89-130172796653.html)
        28 Glen Hunter, ``LETTER: The subtle art of influence--China's
    strategic engagement in the CNMI,'' Pacific Daily News, May 24, 2024.
    (https://www.guampdn.com/opinion/letter-the-subtle-art-of-influence-
    chinas-strategic-engagement-in-the-cnmi/article--27226356-1894-11ef-
    ba26-9b67999cc1b5.html)
        29 Ibid.
        30 Glen Hunter, ``Defending American Interests: Continuing to
    Safeguard Our Nation from Subtle Influences by the PRC,'' Kandit News
    Group, March 1, 2025. (https://kanditnews.com/defending-american-
    interests-continuing-to-safeguard-our-nation-from-subtle-influences-by-
    the-prc)
        31 Cybersecurity and Infrastructure Security Agency, Press Release,
    ``PRC State-Sponsored Actors Compromise and Maintain Persistent Access
    to U.S. Critical Infrastructure,'' February 7, 2024. (https://
    www.cisa.gov/news-events/cybersecurity-advisories/aa24-038a)
        32 Bill Gertz, ``China's `Guam killer' missile force expands
    quickly,'' The Washington Times, April 14, 2021. (https://
    www.washingtontimes.com/news/2021/apr/14/chinas-guam-killer-missile-
    force-expands-quickly)
        33 Cleo Paskal, ``War flashbacks in Guam as China projects power in
    the Pacific,'' The Sunday Guardian (India), September 17, 2023.
    (https://www.fdd.org/analysis/2023/09/17/war-flashbacks-in-guam-as-
    china-projects-power-in-the-pacific)
        34 House Foreign Affairs Committee Republicans, ``The USAID
    Betrayal,'' YouTube, February 13, 2025. (https://www.youtube.com/
    watch?v=s5Rsw0n30sk&t=1s)
        35 The Government of Samoa and Government of the People's Republic
    of China, Press Release, ``Agreement between the Government of Samoa
    and the Government of the People's Republic of China on Mutual Visa
    Exemption,'' January 23, 2025. (https://www.samoagovt.ws/2025/01/joint-
    press-release-agreement-between-the-government-of-samoa-and-the-
    government-of-the-peoples-republic-of-china-on-mutual-visa-exemption)
        36 Savrusa P. L. Sopoaga, ``Concern over immigration and border
    security,'' Samoa Observer, accessed March 3, 2025. (https://
    www.samoaobserver.ws/category/letters/112884)
        37 CDR Arthur M. Dehnz, ``Securing the Seas: Fishery Security Is
    Maritime Security in the Indo-Pacific Command Area of Responsibility,''
    Journal of Indo-Pacific Affairs, March 12, 2024. (https://
    www.airuniversity.af.edu/JIPA/Display/Article/3703818/securing-the-
    seas-fishery-security-is-maritime-security-in-the-indo-pacific-com)
        38 Cleo Paskal, ``Island-Hopping with Chinese Characteristics--What
    the PRC Is Doing in the Pacific Islands, Why It Matters, and Why the
    Time Has Come to `Block and Build,' '' Naval War College Review, 2023.
    (https://digital-commons.usnwc.edu/cgi/
    viewcontent.cgi?article=8381&context=nwc-review)
        39 Joyce Ann L. Rocamora, ``US Indopacom chief: Be ready vs.
    Chinese grey-zone operations,'' Philippine News Agency (Philippines),
    May 4, 2024. (https://www.pna.gov.ph/articles/1224037)
        40 Chris Megerian and Matthew Daly, ``Trump names Interior-designee
    Doug Burgum to head new White House council on energy,'' Associated
    Press, November 15, 2024. (https://apnews.com/article/donald-trump-
    transition-white-house-cheung-gor-f3e02df04ffece1b07a44062ee723d71)
        41 Alice Woodhouse, ``Saipan casino operator drops on FBI visit
    reports,'' The Financial Times (UK), March 31, 2017. (https://
    www.ft.com/content/12933764-130e-31ed-b690-8a97b1f4dbda)
        42 Cleo Paskal, ``War flashbacks in Guam as China projects power in
    the Pacific,'' The Sunday Guardian (India), September 17, 2023.
    (https://www.fdd.org/analysis/2023/09/17/war-flashbacks-in-guam-as-
    china-projects-power-in-the-pacific)
        43 The White House, Press Release, ``America First Investment
    Policy,'' February 21, 2025. (https://www.whitehouse.gov/presidential-
    actions/2025/02/america-first-investment-policy)
        44 Alexander B. Gray, ``Preserving U.S. Interests in the Indo-
    Pacific: Examining How U.S. Engagement Helps Deter Chinese Influence,''
    Testimony before the U.S. House Committee on Natural Resources,
    Subcommittee on Indian and Insular Affairs, May 16, 2023. (https://
    naturalresources.house.gov/uploadedfiles/testimony--gray.pdf)
        45 U.S. Department of Transportation, ``Cabotage definition and
    standards for emergency exemption,'' February 24, 2011. (https://
    www.doi.gov/sites/doi.gov/files/uploads/20-AviationCabotageDOT.pdf)
        46 U.S. National Park Service, ``National Park of American Samoa:
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    samoawwii.htm)
        47 Captain (Ret.) Edwin T. Pollock, ``American Samoa,'' U.S. Naval
    Institute, September 1927. (https://www.usni.org/magazines/proceedings/
    1927/september/american-samoa)
        48 Treaty Between the Kingdom of Samoa and the Kingdom of the
    Hawaiian Islands, Honolulu, HI, February 17, 1887. (https://
    www.hawaiiankingdom.org/treaty--samoa.shtml)
        49 Convention of 1899, American Samoa, December 2, 1899. (https://
    asbar.org/convention-of-1899)
        50 U.S. Department of the Interior, Office of Insular Affairs,
    ``Departmental Manual,'' April 27, 1989. (https://www.doi.gov/sites/
    doi.gov/files/elips/documents/575-dm-1.pdf)
        51 Treaty of Cession of Manu'a, Tutuila, Tau, July 16, 1904.
    (https://asbar.org/wp-content/uploads/attachments/cession2.pdf)
        52 Joint Resolution Extending the sovereignty of the United States
    over Swains Island and making the island a part of American Samoa,
    Resolution 294, 68th Congress (1926), page 119. (https://maint.loc.gov/
    law/help/statutes-at-large/68th-congress/session-2/c68s2ch563.pdf)
        53 U.S. Department of the Interior, Office of Insular Affairs,
    ``Departmental Manual,'' April 27, 1989. (https://www.doi.gov/sites/
    doi.gov/files/elips/documents/575-dm-1.pdf)
        54 Executive Order 10264, ``Transfer of the administration of
    American Samoa from the Secretary of the Navy to the Secretary of the
    Interior,'' June 29, 1951. (https://www.archives.gov/federal-register/
    codification/executive-order/10264.html)
        55 ``About,'' Congresswoman Uifa'atali Aumua Amata Coleman
    Radewagen, accessed February 28, 2025 (https://radewagen.house.gov/
    about)
        56 Michelle Broder Van Dyke, ``Why some American Samoans don't want
    U.S. citizenship,'' NBC News, December 17, 2019. (https://
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        57 ``War in the Pacific,'' U.S. National Park Service, accessed
    February 28, 2025. (https://www.nps.gov/parkhistory/online--books/
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        58 ``World of 1898: International Perspectives on the Spanish
    American War,'' Library of Congress, accessed February 28, 2025.
    (https://guides.loc.gov/world-of-1898/introduction)
        59 The Organic Act of Guam, 48 U.S.C. Sec. 1421. (https://
    www.guamcourts.org/CompilerofLaws/GCA/OrganicAct/Organic%20Act.pdf)
        60 Northern Mariana Islands Delegate Act, H.R. 4067, 104th Congress
    (1995-1996), Accompanying report. (https://www.congress.gov/
    congressional-report/104th-congress/house-report/856/
    1?outputFormat=pdf)
        61 An Act to provide for the establishment of constitutions for the
    Virgin Islands and Guam, Pub. L. 94-584, 90 Stat. 2899. (https://
    uscode.house.gov/statutes/pl/94/584.pdf)
        62 Joshua F. Tenorio and Dr. James Perez Viernes, ``Guam
    Constitutional Conventions (ConCon),'' Guampedia, June 29, 2024.
    (https://www.guampedia.com/guam-constitutional-conventions-concon)
        63 United Nations Security Council, ``Trusteeship of Strategic
    Areas,'' March 12, 1947, pages 16-21. (https://docs.un.org/en/S/RES/
    21(1947))
        64 Executive Order 10265, ``Transfer of The Administration of The
    Trust Territory of the Pacific Islands from the Secretary of the Navy
    to the Secretary of the Interior,'' June 29, 1951. (https://
    www.trumanlibrary.gov/library/executive-orders/10265/executive-order-
    10265)
        65 Norman Meller, The Congress of Micronesia: Development of the
    Legislative Process in the Trust Territory of the Pacific Islands
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    stable/j.ctvp2n5bt)
        66 Former U.S. President Jimmy Carter, ``A Proclamation''
    Proclamation 4534--Constitution of the Northern Mariana Island, October
    24, 1977. (https://www.presidency.ucsb.edu/documents/proclamation-4534-
    constitution-the-northern-mariana-islands)
        67 Covenant To Establish a Commonwealth of the Northern Mariana
    Islands in Political Union with the United States of America, Pub. L.
    94-241, 48 U.S.C. Sec. 1801. (https://cnmilaw.org/cov.php#gsc.tab=0)
        68 Former U.S. President Ronald Reagan, ``A Proclamation,''
    Proclamation 5564--United States Relations With the Northern Mariana
    Islands, Micronesia, and the Marshall Islands, November 3, 1986.
    (https://www.reaganlibrary.gov/archives/speech/proclamation-5564-
    united-states-relations-northern-mariana-islands-micronesia-and)

                                     ______

    Questions Submitted for the Record to Cleo Paskal, Non-Resident Senior
                 Fellow, Foundation for Defense of Democracies

                Questions Submitted by Representative Westerman

        Question 1. The CNMI's fiscal condition is worsening. Its tourism
    industry is not rebounding to pre-Covid levels, it is struggling to pay
    its mandatory pension payments, and it is facing significant financial
    management challenges. How can the United States government best
    support the CNMI in pursuing market-based solutions to these
    challenges?

        Answer. Currently the economic ground in CNMI is choked with the
    binding weeds of years of mismanagement and likely corruption. For
    healthy economic roots to grow, critical first steps are thorough
    investigations and, if warranted, prosecutions around past transfers of
    large amounts of federal funds, the PRC-linked casinos and other large
    scale money flows that continue to affect the economic health of CNMI
    and its reputation as a safe place for investment.
        Governor Palacios has repeatedly asked for help from the FBI,
    Treasury and other relevant agencies in cleaning up CNMI--including
    asking for a resident District Attorney. It would also help to have a
    permanent FBI field office in Guam with a satellite office in CNMI to
    help track and prosecute illegal activity moving through the
    territories. Currently the closest FBI field office is in Honolulu--an
    eight-hour flight away from Guam.
        This `weeding' of the economic environment will be painful, but it
    is necessary for anything healthy to grow.
        Once that's done, it will be easier to attract investment, and
    diversify away from sectors artificially emphasized by outside actors
    for their own interests. For example, it is likely Japanese investors
    have been discouraged from staying engaged because of the (at the
    least) perception of the role of Chinese influence in CNMI.
        As for specific market-based opportunities, once the ground is
    healthy, there are a range of options suggested in my written
    testimony, and deep local expertise in viable paths forward.
        Some will require policy changes (such as exemption from cabotage),
    others will require investigation (for example how the privileged
    position of United Airlines limits growth) and others will need new
    ways of looking at existing investments (for example building out
    Northern Marianas College (NMC) into a regional educational hub to
    bring in students from across the region and FAS). It might make sense
    to support an economic development research institute at NMC to
    research options outside the vested interests currently driving the
    discussions.

        1a) In what ways have the People's Republic of China (PRC) and
    North Korea contributed to the CNMI's economic deterioration?

        Answer. Chinese business interests--which can be regarded in many
    cases as an extension of the Chinese state as being given permission to
    take capital out of China is a political decision--have been appearing
    periodically since CNMI joined the U.S. They consistently present
    themselves as a panacea to bring prosperity to CNMI--indeed as the only
    option. Rather, they have mostly temporarily enriched a select number
    of locals and other Chinese. Consider the garment industry of the
    1980s, and the subsequent casino-linked operations--including on Tinian
    and Saipan.
        One is hard pressed to note any lasting economic or social benefit
    from these Chinese business schemes. Perhaps the most lasting outcomes
    are enormous, empty, dilapidated buildings (including the largest
    building in the capital, Garapan, that is built over a former grave
    site and resulted in the callous displacement of human remains) and a
    reputation for corruption and illegal activities that discourages
    others from investing in CNMI.
        The `sales' phase of these projects can involve lavish donations,
    including to CNMI coffers that can create a dependency on the allure of
    `Chinese money' that squeezes out efforts to diversify the economy and
    leads to a sort of `mental strait jacket' that prevents other
    initiatives to develop other sources of economic progress.
        And in the process it creates a pro-China constituency in CNMI--
    that tends to see rivals as enemies--and creates rifts in local
    society.
        As mentioned, there are reports that Chinese interests have pushed
    out Japanese and Korean tourism sector investors as well. This has the
    effect of closing off or narrowing potential markets and employment
    sources--along with the ripple effects hotels have on the local economy
    and employment with businesses supplying the hospitality industry.
        The Chinese Communist Party would prefer there to be no economic
    development in CNMI other than economic development that is dependent
    on China. China and its proxies will actively sabotage other pathways
    to development unless they are stopped. They want the narrative to be
    ``China is the only way'' and will destroy or sabotage viable
    alternatives to support that narrative.
        This has been going on a long time. As reported by Grant Newsham in
    Winning Without Fighting: Chinese and Russian Political Warfare
    Campaigns and How the West Can Prevail Volume II: Case Studies (Center
    for Strategic and Budgetary Assessments, 2019:

    https://csbaonline.org/uploads/documents/
    Winning_Without_Fighting_Annex_Final2 .pdf):

        In 2014, Chinese-owned casino company Best Sunshine opened in
    Saipan, a small island with a population of 50,000, promising multi-
    billion-dollar investments. For the island, the timing was seemingly
    fortuitous. Its economy was in the doldrums, and its government
    finances were on the verge of collapse. Amidst rumors of bribes, Best
    Sunshine was approved for business. Along with this company came a
    timely contribution to the public pension fund and to Saipan's
    utilities company. In addition, Chinese nationals migrated to the
    island, began leasing and buying property, and started other
    businesses. This, combined with visa-free entry for Chinese tourists,
    created a rapid growth Chinese presence that didn't exist a few years
    prior. This surge has generated a segment of the local population and
    political class that views the People's Republic of China (PRC)
    presence as a strong positive. As a result, anything that threatens to
    upset that relationship, such as U.S. military bases, is viewed as a
    problem.
        The casino is rapidly becoming a tool of political influence, with
    reports that the casino developers have funded several candidates in
    the 2018 elections. Saipan's governor also announced a $20.8 million
    special funding measure described as being generated by casino tax
    payments. The money appeared right before the election and included
    $3.5 million for CNMI retiree fund member bonuses and a $150,000 grant
    for the Marianas Political Status Commission, a body created solely to
    decide how to become independent from the United States.

        Question 2. What problems will Illegal, Unregulated, and Unreported
    fishing cause the Pacific territories if left unaddressed?

        Answer. One particular problem is environmental. There is no reason
    the Pacific territories can't find themselves like eastern Canada when
    the fisheries collapsed. This destroys local livelihoods, food security
    and one of the potential economic pillars of the Pacific territories--
    as well as depriving national governments of income from the fisheries.
        IUU fishing and attendant lawlessness also ties in to corruption of
    local officials and related organized crime activities can tear local
    societies apart--including through human and drug trafficking.
        This contributes to a demoralization on the part of honest
    officials and people who are trying run a proper government and manage
    national resources--but have to watch IUU take place while being unable
    to do anything about it.
        Additionally, China often uses its `fishing fleet' as a dual use
    weapon, using it for illegal, coercive, aggressive and deceptive
    activities, as seen in the Philippines, in order to advance Beijing's
    strategic interests.

        Question 3. There has been an exponential rise in the number of PRC
    nationals entering Guam illegally. How exactly are these PRC nationals
    illegally entering Guam?

        Answer. A large number come illegally from CNMI, mostly by boat.
    The island of Rota (CNMI) is less than 40 miles from Guam. Chinese
    nationals can enter CNMI legally easier than anywhere else in the
    United States. But they are not supposed to leave CNMI. At least in the
    hundreds, but likely much more, they travel to Guam illegally from
    CNMII. If the situation is like human smuggling by sea elsewhere--say,
    southern Florida and southern California--only a fraction of smuggling
    efforts are detected.

        3a) How does this threaten Guam?

        Answer. It provides vulnerable people for use by criminal networks
    (including drug and human trafficking) which undermines the rule of law
    and civil administration in Guam.
        Additionally, Chinese nationals can be resources for Chinese
    intelligence services (indeed, they are obligated to be under China's
    2017 National Intelligence Law). This is a serious security risk. A
    March 2025 Facebook post from the Commander of 36th Wing, Andersen Air
    Force Base, Guam read:

    (https://www.facebook.com/story.php?story
    fbid=122251726886028170&id=61550845118589&rdid=YHKivAoc9xnMyokN):

        We've had some significant upticks in number of attempted
    incursions on to our Air Base by citizens from non-allied Nations . . .
    especially when we are hosting major exercises. I know weird right? My
    team reports that with the installation of these new signs we can
    become more intrusive as we search these people trying to gain access.
        Between you and me, the excuses we get from these people as they
    try to get through our gates are pretty weak. Defender, ``Where are you
    trying to go on Andersen?'' Interloper, ``To the dog park.'' Defender,
    ``You don't have a dog bro!'' Alright China . . . Bring it! `Murica!

        This gives an indication of intent on the part of China, and
    concern on the part of U.S. forces in Guam. Combined with PRC-linked
    cyberattacks on its critical infrastructure, one has to be concerned
    about China having a locally-based network that can be activated at
    will to advance China's strategic goals. Even a few such people, say,
    using small armed drones could wreak havoc on U.S. military aircraft at
    Andersen Air Force Base and other critical installations on Guam.

        3b) Should addressing these threats while fostering economic
    prosperity be a priority for the U.S.-CNMI Section 902 consultations?

        Answer. Yes. As described above, unless the illegal, coercive,
    aggressive and deceptive Chinese activity is blocked to the maximum
    extent, economic prosperity becomes very difficult. Governor Palacios
    has repeatedly asked for assistance in cleaning up corruption and
    investigating past waste, fraud and abuse. Providing the needed
    economic support going forward, while ensuring the economic environment
    is rid of noxious elements would result in the necessary blocking and
    building to get to something sustainable.

        Question 4. Have there been any malign political efforts by the PRC
    in the Pacific territories? If so, please elaborate.

        Answer. Yes, there have been, for at least the last thirty years
    and in every corner of the Pacific--including U.S. territories, the
    Freely Associated States, and other independent nations.
        As one example, the President of Federated States of Micronesia,
    David Panuelo wrote in his March 9, 2023, letter:

        ``Senior officials and elected officials across the whole of our
    National and State Governments receive offers of gifts [from China] as
    a means to curry favor. The practical impact of this is that some
    senior officials and elected officials take actions that are contrary
    to the FSM's national interest, but are consistent with the PRC's
    national interests . . . So, what does it really look like when so
    [many] of our Government's senior officials and elected officials
    choose to advance their own personal interest in lieu of the national
    interest? After all, it is not a coincidence that the common thread
    behind the Chuuk State secession movement, the Pohnpei Political Status
    Commission and, to a lesser extent, Yap independence movement, include
    money from the PRC and whispers of PRC support.''
        I have detailed many, many other specific examples in my articles
    and Congressional testimonies, including in:

         Protecting the Corridor of Freedom to America's Asian
                Border (Journal of Indo-Pacific Affairs, July, 2024,
                https://www.airuniversity.af.edu/JIPA/Display/Article/
                3821582/protecting-the-corridor-of-freedom-to-americas-
                asian-border/)

         Island-Hopping with Chinese Characteristics--What the PRC
                Is Doing in the Pacific Islands, Why It Matters, and Why
                the Time Has Come to ``Block and Build'' (Naval War College
                Review, Autumn, 2023, https://digital-commons.usnwc.edu/
                cgi/viewcontent.cgi?article=8381&context=nwc-review)

         Testimony for U.S.--China Economic and Security Review
                Commission, 20 March 2025. https://www.uscc.gov/sites/
                default/files/2025-03/Cleo_Paskal_Testimony.pdf

         Testimony for House Natural Resources Subcommittee on
                Indian and Insular Affairs, 14 June 2023. https://
                naturalresources.house.gov/uploadedfiles/
                testimony_paskal.pdf

         Testimony for House Natural Resources Subcommittee on
                Indian and Insular Affairs, 16 May 2023. https://
                naturalresources.house.gov/uploadedfiles/
                testimony_paskal.pdf

        China's influence efforts follow a predictable pattern of
    commercial presence leading to political influence (almost invariably
    facilitated with bribery and other emoluments), with the intention of
    displacing the United States and Western nations from the region. The
    final step in the pattern is a desired military presence.

        4a) What are the short-term and long-term threats this presents to
    the Pacific territories?

        Answer. The short-term threats are shifts in once solidly pro-
    Western societies to at best societies riven by pro-West, pro-PRC
    factions, and even an element seeking to sever any links to the United
    States and the West. This obviously makes U.S. policy and strategic
    interests in the region far more problematic. Pacific island support at
    international organizations becomes even harder to obtain--while the
    PRC benefits.
        The PRC is able to use `success' in one place as a springboard to
    influence efforts and subversion in other locations.
        If you think of the Pacific map as a game board, you'll see more
    Chinese `markers' on the board and fewer `U.S./ Western markers.'
        It will become impossible for U.S. (and allies and partners) to do
    any `building'--much less `blocking'--as they are frozen out.
        Long-term we could find ourselves without any real friends in the
    region--and having to struggle to maintain a military (and even
    political) presence in peacetime--and having to fight for our presence
    in the region in wartime. We've taken for granted having free-access
    from the United States to the western edge of the Pacific. The bill for
    our lassitude toward Chinese influence efforts in the region may come
    due sooner than imagined.

        Question 5. Your written testimony highlighted the several federal
    agencies that play a role in ensuring the prosperity and security of
    the Pacific territories. How would robust coordination and organization
    of these federal agencies benefit the Pacific territories?

        Answer. It is essential to truly deliver security and prosperity.
    Some specific recommendations:

         Raise Pacific Hemispheric defense to the National Security
                Council (NSC) level. It is essential to ensure that
                clearing the Pacific of as much Chinese illegal, coercive
                aggressive and deceptive (ICAD) activity as possible and
                promoting economic and social resilience is a priority at
                the National Security Council so that all the tools of
                state can be deployed. At least part of that can be
                accomplished through the U.S. Department of the Interior's
                leadership mandate regarding the U.S. Pacific territories
                and the Compact states. They are America's western border
                and should be included as part of the hemispheric defense
                approach being adopted by the Trump administration.

          Expand the role of Interior Secretary Doug Burgum on the
                NSC. Due to his position as head of the National Energy
                Council, Secretary Burgum is on the NSC. Interior is also
                responsible for the U.S. territories and the Compact
                states. Expand his role to include overseeing and
                coordinating their defense and reinforcement.

          Revitalize the Interagency Group on the U.S. Compact
                states, which is co-chaired by the secretaries of the
                interior and state.

          Set up a special investigative interagency unit to
                uncover strategic corruption and prosecute criminal
                networks that operate across the region. This could focus
                initially on the U.S. territories and Compact states. Under
                the Compacts of Free Association, Washington has an
                ``obligation to defend the Marshall Islands and the
                Federated States of Micronesia [and Palau] and their
                peoples from attack or threats.'' One would think the
                deliberate attempts at economic destruction count as a
                threat. At this point, a few good investigators and
                aggressive lawyers from outside the region might provide
                them with more security than any number of F-35s. And it
                could ensure the F-35s (or their pilots) don't get
                sabotaged on the runway if the time ever comes that they
                are needed. Currently, given the degree of involvement of
                Chinese organized crime and the tight-knit nature of
                Pacific islands societies, there is difficulty going after
                the `big fish.' If this isn't done, it will be very hard to
                get anything else to work over the long run. The region is
                not equipped to investigate and counter this scale and
                complexity of penetration on its own. Currently, across the
                region, there is little downside to selling out to China
                and significant economic and social downsides for those who
                take a stand--including, as seen in the Solomon Islands,
                risks to livelihood and life. The corruption is destroying
                the rule of law, breaking up families, and becoming a
                conduit for illegal drugs, human trafficking, and more. It
                also creates a pervasive atmosphere of fear in these tight-
                knit societies. It would also make sense for the U.S.
                military to assist on some of the investigations. The
                Department of Defense has the largest American presence on
                the ground in the Compact states, and it knows and possibly
                values the region the most. As an example, the attorney
                general of Palau is consistently looking for lawyers.
                Perhaps look at using military reservists?

                Questions Submitted by Representative King-Hinds

        Question 1. In your testimony before the Committee, you provided
    that the CNMI was once a territory of the Soviet Union. Specifically,
    you stated: ``For CNMI it was Japan and the Soviets''. Living in the
    CNMI and spending my life studying CNMI history, I have never heard of
    the CNMI being a territory of the Soviet Union. Can you please provide
    your sources for such a claim? If this was a mistake, what other claims
    in your testimony built on your current understanding of the CNMI
    require additional review?

        Answer. This is a mischaracterization of my testimony. At no point
    did I say CNMI was a territory of the Soviet Union because, of course,
    it was not.
        My full quote is ``The three U.S. Pacific territories are deeply
    experienced at geopolitics. All became part of the U.S. as a result of
    wars or strategic contests. Today we will mostly talk about China and
    North Korea. 127 years ago, for Guam, it was Spain. Then, for American
    Samoa, it was Germany and Britain. For CNMI, it was Japan and the
    Soviets.''
        The context for American Samoa and CNMI becoming part of the United
    States was, as mentioned in the full quote, ``wars or strategic
    contests''. In the case of American Samoa, the rivalries in the region
    were between the U.S., Germany and Britain. In the case of CNMI, first
    there was the war with Japan, but then it was the strategic contest
    between the U.S. and the Soviet Union (the Cold War) that drove policy
    makers in the U.S. to work with leaders in Micronesia to create the
    Covenant that led to CNMI becoming part of the U.S. For a sense of how
    central concern over the Soviet Union was during that period, please
    see: https://www.c-span.org/program/public-affairs-event/pacific-
    island-issues/94623

        Question 2. Your testimony made several recommendations that seek
    to reshape the economy of the CNMI. Please expand on your experience
    conducting tourism market research, economic development policy
    analysis, or investment assessments in the CNMI that would justify
    these proposals. If you have not personally conducted these analyses,
    who are the experts in the region that assist you in providing these
    recommendations?

        Answer. I covered travel and the travel industry professionally for
    over two decades, including weekly columns for the National Post,
    presenting and producing shows for the British Broadcasting Corporation
    (radio) and writing for a wide range of publications from Lonely Planet
    to Conde Nast Traveller. My journalism has won over a dozen
    international awards, including Best Overall (twice) from the North
    American Travel Journalists Association.
        One of my areas of focus is countries with relatively small
    populations. For example, I produced a six-part series for BBC World
    Service on the unique character of small polities, including economics,
    politics, justice, and environmental issues.
        This work crosses over into policy research. For example, I was
    Guest Curator and Editor of an East-West Center (D.C.) series on
    Oceania and led Le Pole de Recherches sur l'Oceanie--The Oceania
    Research Project, a multi-year research project based at the Centre
    d'etudes et de recherches internationales de l'Universite de Montreal
    (CERIUM). I was also an Associate Fellow at Chatham House (Royal
    Institute of International Affairs) for over a decade-and-a-half, and
    was research lead on a multi-year Chatham House project looking at
    strategic shifts in the Indo-Pacific, including Oceania.
        I am currently leading a research project looking at how to
    increase security and rosperity in the U.S. Freely Associated States
    (FAS), Guam and CNMI. For this project I have spent most of the last
    three years focused on the region, including multiple trips to CNMI,
    Guam and the FAS, where I've learned from a wide range of local
    experts. A priority is to amplify the knowledge of those from the
    region so that decision makers elsewhere can hear first-hand of
    concerns. As a result, some of those interviews have been made public
    through articles, reports and events. Here, for example, is a public
    event held with Governor Arnold Palacios of CNMI. https://www.fdd.org/
    events/2024/02/22/strengthening-americas-asian-border-a-discussion-
    with-northern-marianas-governor-arnold-palacios/
        All that said, given the questions from Rep. King-Hinds, it seems
    as though the main area of disagreement is if CNMI should become more
    reliant on tourism from China. In that context, it is not solely
    expertise in ``tourism market research, economic development policy
    analysis, or investment assessments'' that is relevant, but an
    understanding of Chinese political warfare, including strategic
    corruption, patterns of Chinese tourism/investment weaponization and a
    general understanding of China's systematic use of illegal, coercive,
    aggressive and deceptive (ICAD) behavior to create deliberate social
    disintegration and economic dependency in target locations.
        This is also something I have worked on extensively in my research.
    For a better understanding of these issues, I would recommend:
        Prof. Kerry Gershaneck's Political Warfare : Strategies for
    Combating China's Plan to ``Win Without Fighting'' (Marine Corps
    University Press, 2020), available for free here: https://
    www.usmcu.edu/Portals/218/Political%20Warfare_web.pdf
        To see some of the approach described from a Chinese point of view,
    please see Unrestricted Warfare by two People's Liberation Army Air
    Force Colonels, Qiao Liang and Wang Xiangsui (PLA Literature and Arts
    Publishing House, 1999), available for free here: https://www.c4i.org/
    unrestricted.pdf
        Specific to the way China weaponizes tourism and investment in
    Micronesia, here is a public event with President Surangel Whipp Jr. of
    Palau in which he describes the economic attacks on his country:
    https://www.fdd.org/events/2023/07/17/the-united-states-and-palaus-
    strategic-partnership-a-conversation-with-president-surangel-s-whipps-
    jr/
        To understand how Chinese `unrestricted warfare' affects democracy
    and economic sustainability elsewhere in Micronesia, here is a public
    talk by former President David Panuelo of the Federated States of
    Micronesia. Also at this location are three letters he wrote detailing
    China's operations in his country, and his thoughts on the implications
    for the region (including CNMI). https://www.fdd.org/events/2023/12/01/
    chinas-pacific-coercion-a-conversation-with-former-president-of-
    micronesia-david-panuelo/

        Question 3. In your testimony, you stated that the lifting of
    cabotage restrictions would ``greatly increase the chances of increases
    in Japanese tourism.'' I am very interested in the market research and
    economic analysis you have conducted to support this claim. Given that
    Guam, which already receives direct flights from Japanese carriers,
    remains 34.4% below pre-pandemic Japanese arrival numbers this fiscal
    year to date, and considering the high value of the U.S. dollar and
    rising travel costs, what is your estimated projection of additional
    Japanese tourists to the CNMI if cabotage restrictions were eliminated?
    Additionally, what airlines have you consulted that have expressed
    interest or made commitments to providing direct air service to the
    CNMI should cabotage restrictions be lifted?

        Answer. A wide range of leaders in CNMI have mentioned how lifting
    cabotage restrictions would help, including with the Japanese market.
    For example, here is Rep. King-Hinds, from a 7 March 2025 article in
    Marianas Variety entitled `King-Hinds, Moylan push for air cabotage
    reform to improve travel access for NMI, Guam': ``H.R. 1536 would
    introduce much-needed airline competition by allowing specified
    carriers from Japan, South Korea, and the Philippines to operate
    flights between our islands and another U.S. point. This is a common-
    sense solution that would expand travel options, lower costs, and
    improve connectivity between the territories and the mainland U.S.''
    https://www.mvariety.com/news/local/king-hinds-moylan-push-for-air-
    cabotage-reform-to_improve-travel-access-for-nmi-guam/article_867d4c68-
    fa7e-11ef-ff5-740094ce02e.html

        Question 4. You stated that the CNMI can successfully compete for
    Chinese tourism with destinations like Los Angeles. However, in 2017,
    the Marianas Visitors Authority commissioned a study, Tourism
    Development in the U.S. Commonwealth of the Northern Mariana Islands,
    conducted by the international tourism consultancy Horwath HTL, which
    found that requiring visas for Chinese tourists would result in a
    decline of up to 80% in arrivals from that market. Please provide your
    economic analysis or market research that contradicts this report and
    supports your assertion that the CNMI could remain competitive under a
    visa requirement. Additionally, what projections do you have regarding
    the impact of such a policy on the CNMI's tourism revenue, employment,
    and overall economic stability?

        Answer. Again, this is a mischaracterization of my testimony. I did
    not state CNMI can successfully compete for Chinese tourism with
    destinations like Los Angeles. The exchange from the hearing was:
        Rep King-Hinds on Chinese tourists: ``if it's good for California,
    why is it not good for the Commonwealth?''
        My comment later in the hearing: ``If you are Chinese coming into
    California you need a visa and, as you've said, Chinese tourism in
    California is just fine so why would it affect Chinese tourism to
    CNMI?''
        The point was Chinese tourists going to California require a visa
    and yet, as Rep. King-Hinds states, California still gets tourists from
    China. So why would requiring a visa affect tourists going to CNMI?
        The study referenced by Rep. King-Hinds is eight years old, pre-
    pandemic, pre-typhoon and was done at a time that likely included
    (since then closed) casino-related tourism. Times have changed
    substantially, as evidenced by the fact that, even without requiring
    visas, tourism from China has collapsed.

        Question 5. Your testimony highlights PRC influence but does not
    prove that Chinese tourism in the CNMI poses a national security
    threat. Has any national security agency confirmed to you that Chinese
    tourists under EVS-TAP are a direct risk?

        Answer. Asking ``Has any national security agency confirmed to
    you'' implies a relationship I do not have with national security
    agencies. As a Member of Congress, Rep. King-Hinds has privileged
    access to national security agencies and so can ask directly. However,
    wording is important.
        The question above is extremely narrow. To understand the real risk
    to the people of CNMI, some sample questions Rep. King-Hinds might want
    to ask national security agencies are:

         Are Chinese entering CNMI under EVS-TAP vetted to the same
                standard as Chinese entering the rest of the United States?

         If not, does that discrepancy increase the risk of
                negative consequences for the CNMI and the rest of the
                United States?

         How many people who come in on EVS-TAP overstay?

         How does that compare to Chinese who come in to the rest
                of the United States with a visa?

         Are Chinese coming in on EVS-TAP illegally going to other
                parts of the United States?

         What crimes are being committed by Chinese who enter the
                CNMI on EVS-TAP visas?

        The issue isn't Chinese tourists per se, it is entry of Chinese who
    are vetted to a lower standard than those who enter in the rest of the
    United States. This lower threshold is logically likely to attract
    (among the many legitimate Chinese tourists) those who look for more
    lax entry requirements because they might not meet normal visa
    verification standards.

    From my written testimony:

        In CNMI, from 2009, PRC nationals have been allowed to enter CNMI
    without visas as required in the rest of the United States. According
    to CNMI Gov. Arnold Palacios' August 2023 congressional testimony, due
    to the need for economic development: ``We turned to Chinese gambling,
    legalizing casino gaming on Saipan even after the venture previously
    failed on Tinian. An exclusive license was nevertheless awarded to a
    Chinese casino operation that has been mired in litigation and criminal
    investigation practically from the start . . . The Chinese casino on
    Saipan at its peak raked in billions of U.S. dollars in monthly rolling
    chip volumes from just 16 VIP tables, outdoing even the glitziest
    casinos in Macau.''
        This boosted the economy but also, according to Palacios, ``was
    fraught with controversy--from human trafficking to birth tourism,
    labour abuse, money laundering, and public corruption.''
        Chinese have been found traveling illegally to Guam by boat (and
    roaming on military installations), using the U.S. postal service to
    distribute illegal drugs, selling illegal drugs, and buying U.S.
    driver's licenses. There is no similar link to such extensive criminal
    activity with any other single nationality in CNMI.
        The EVS-TAP is new and so extensive data is not yet available,
    however it is still a lower standard for entry and the same logic
    applies. The reason that those promoting more tourism from China laud
    it for (easier entry for Chinese short-term visitors to CNMI than to
    the rest of the U.S.) is the same reason it causes concern. Don't the
    people of CNMI deserve the same protections from those who want less
    scrutiny than have all other Americans?

        Question 6. If illegal entry is the concern, wouldn't enhanced
    enforcement--like EVS-TAP--be a more effective and economically
    responsible solution than banning travelers?

        Answer. The concern is not illegal entry, nor do I propose banning
    Chinese tourists. As explained above, the concern is entry of Chinese
    who are vetted to a lower standard than those who enter in the rest of
    the United States. This lower threshold is logically likely to attract
    (among the many legitimate tourists) those who look for more lax entry
    requirements because they might not meet normal visa verification
    standards.

        Question 7. In your written testimony, you stated, ``The Department
    of Homeland Security should require all tourists entering CNMI to have
    the same visas as tourists entering the rest of the United States.''
    However, when asked about this proposal, it appeared that you revised
    your position. Given that visitors from Japan and South Korea currently
    enter the CNMI visa-free, on what basis are you proposing to restrict
    their access by requiring them to obtain the same visas as tourists
    entering the rest of the United States? Assuming that your written
    testimony reflects your actual position, how does restricting access to
    all tourists to the CNMI--further collapsing the only existing
    industry--benefit American interests in the region?

        Answer. This is another mischaracterization that was addressed
    directly during the hearing. The relevant parts of the exchange are:
        Rep King-Hinds on Chinese tourists: ``if it's good for California,
    why is it not good for the Commonwealth''
        Later, Rep. King-Hinds said to me: ``In your testimony you propose
    requiring visas for tourists including Japan and South Korea.''
        My reply: ``I'm sorry, no, I don't. I think that people coming into
    any part of the United States should have the same entry points . . .
    If you are Chinese coming into California you need a visa and as you've
    said Chinese tourism in California is just fine so why would it affect
    Chinese tourism to CNMI?''
        I was clear that I did not think Japanese or South Korean tourists
    needed a visa (``no, I don't''). By the `same entry points' I meant
    those coming from a given country should enter into the United States
    in a uniform manner no matter what part of the U.S. they enter.
        My position seems to have been widely understood, except by Rep.
    King-Hinds. On the 19 March 2025 Good Morning Marianas show, Rep. King-
    Hinds appeared as a guest and brought this up. The host, Brad Ruszala
    clearly understood my meaning and tried to clarify for Rep.
        King-Hinds, as can been seen here: https://www.youtube.com/
    watch?v=WF4-ryMQ10c

        Question 8. The Office of the U.S. Trade Representative estimates
    that the value of trade between the United States and China was $582.4
    billion in 2024, including $143.5 billion in U.S. exports to China.
    Tourism is the CNMI's only export industry, and its primary markets
    include China. Based on your testimony, are you suggesting that the
    United States should cease all trade with China across all industries
    and in all Congressional districts to protect against foreign
    influence? If not, why would you propose that the CNMI alone be
    restricted from engaging in commercially viable trading opportunities
    while every other 1U.S. jurisdiction continues to benefit from trade
    with China? If trade with China is a security risk, should the U.S.
    halt subsidizing all industries who trade with the country?

        Answer. This is a conflation of one section of the tourism sector
    (Chinese tourists to CNMI who are not vetted to the same standard as
    Chinese tourists to the rest of the United States) and trade as a
    whole. My testimony was about the first, not the second. Also worth
    noting is that China is not now one of CNMI's ``primary markets''. In
    spite of not having reached the caps on direct flights from China,
    having the ability to have charter flights from China and there still
    being no visa requirements, Chinese tourism to CNMI in February 2025
    was 1,684 arrivals compared to 11,126 arrivals from South Korea.
        As for my position on trade with China, it aligns closely with the
    Presidential Action America First Investment Policy (February 2025).
    https://www.whitehouse.gov/presidential-actions/2025/02/america-first-
    investment-policy/

        Question 9. Above all, before engaging in economic policy
    discussions regarding the complexities of operating in the CNMI, can
    you provide your commitment to gain a deeper understanding of the
    challenges the CNMI is facing and the historical context of the region
    you are researching? Given the significant implications of your
    recommendations, will you take the time to engage directly with local
    leaders, businesses, and residents to ensure that any policy proposals
    you advocate for are informed by the realities on the ground?

        Answer. It is a great pleasure and privilege to learn from the
    elders, experts and others in CNMI. They are the ones who informed and
    shaped the recommendations in my written testimony and I am grateful to
    them for the time they take to educate me. For example, the
    recommendation for a ferry from Guam to Rota came out of meetings on
    Rota with the Mayor's office.
        I am keenly aware the people of CNMI often feel they don't have a
    voice in Washington--and sometimes even find it difficult to express
    themselves freely in CNMI for fear of vested lobbies coming after them
    (and possibly their families) in what is a tight-knot society. I take
    seriously my responsibility to ensure their vision for the future isn't
    mitigated and distorted by special interests.

        Question 10. Do you believe the PRC, and possibly even North Korea,
    have helped contribute to the CNMI's economic deterioration? Please
    explain your position.

        Answer. Over the decades, as Governor Palacios put it in his 2023
    Congressional testimony: ``Chinese investors were always conveniently
    there when we needed them, offering almost irresistible opportunities
    for new industries and revenue sources that also directly or indirectly
    advanced the interests of the PRC in the Marianas.''
        For decades, each simple Chinese `one-stop shop' economic panacea
    to CNMI's economic woes has created destabilizing booms and busts,
    including the garment sector, gambling and tourism. None has lasted. At
    this moment, when Chinese tourism is at a low anyway, there is a window
    to diversify not just in terms of tourism markets, but in terms of
    sectors (see some recommendations below).
        In Rep. King-Hinds discussion on Good Morning Marianas referenced
    above, she mentions that building up Chinese tourism will take time.
    Also, she said, things like getting the ferry from Guam to Rota will
    take time. So why not work on it all now? With effort and creativity,
    and a willingness to bring in more local expertise while leveraging
    interest in Washington, new pathways can be built. For example, a
    concern Rep. King-Hinds raised about the Rota ferry was the state of
    the wharf. Perhaps she can work with the U.S. military to see if it can
    assist to construct something suitable? More public discussions along
    these lines might bring to the fore new options rather than just the
    same old destabilizing booms and busts of the past.
        As Rep. King-Hinds said during the hearing; ``I agree with
    everything that everyone has said on this panel--we are on the same
    team. and we agreed that we must all do our part to address these
    threats.''

        Question 11. Would it be fair to say that the Office of Insular
    Affairs should make it a priority to find ways to help the CNMI address
    these economic challenges?

        Answer. It is the responsibility of the Office of Insular Affairs
    to do that for CNMI and all the other jurisdictions under its remit.

        Question 12. Do you have any recommendations for how OIA, or the
    U.S. government more broadly, can help the CNMI address its economic
    challenges?

        Answer. Yes, they are included in my written testimony, CNMI
    relevant ones are below.
        The basic framework is a ``Block and Build'' approach in which
    Chinese behavior that is illegal, coercive, aggressive, and deceptive
    (ICAD--as Philippines General Romeo Brawner calls it) is blocked while
    simultaneously building domestic, economic, and legal security. Given
    the advanced state of PRC ICAD activity, especially in Guam and CNMI,
    one must assume that any major projects designed to provide economic,
    political, or security independence (build), especially ones that make
    them less reliant on China, will be targeted by PRC agents and slowed
    down through a range of tactics. Unless that targeting is blocked, it
    will be hard to build.
        Given the goals of the PRC, its ICAD activity should be countered
    and attacked with the same focus and vigor that is directed toward
    preparing for future kinetic warfare. The PRC has made its trajectory
    clear. Failing to address Chinese aggression in America's Pacific
    homeland now will make the likely eventual confrontation with the PRC
    more difficult and more costly.
        This is a whole-of-government effort. However, the U.S. Department
    of the Interior's mandate regarding the territories and the FAS gives
    it a leadership position. Interior Secretary Doug Burgum has a seat on
    the National Security Council (NSC) due to his position as head of the
    National Energy Council. Perhaps, this NSC role could be expanded to
    oversee and coordinate the defense and reinforcement of the Pacific
    territories and the FAS--America's Western border--as part of the
    hemispheric defense approach being adopted by the Trump administration.
        That approach could function to focus and reinforce efforts of the
    Office of Insular Affairs (OIA). For example, OIA has a field agent in
    each territory; however, their role is vague. Instead, OIA field agents
    could play a greater block and build role by coordinating locally with
    other departments and with Washington--including the interagency--and
    informing, via Secretary Burgum's office, the NSC. Historically, OIA
    has been ``low key''--at best, reactive in times of crises. With more
    coordination and information flows, and direction from Secretary
    Burgum, the chances of getting ahead of issues improve. Some
    suggestions on how to do that at a more tactical level are below.
    Block
        A key entry point for PRC ICAD is corruption. The territories (and
    the FAS) are not equipped to investigate and counter this scale and
    complexity of penetration on their own. The U.S. territories (and the
    FAS) urgently need assistance to investigate and prosecute illegal
    activities, in particular, strategic corruption. Currently, there is
    little downside for local elites and others to sell out to the PRC and
    significant economic and social downsides for those who take a stand.
    There is a pervasive atmosphere of fear in these tight-knit societies,
    so investigators and prosecutors would ideally come in from outside the
    region. At this point, a few good investigators and aggressive lawyers
    might provide the territories (and the FAS) with more security than any
    number of F-35s.
        OIA could focus on technical assistance programs designed to
    counter corruption, waste, fraud, and abuse. It could also coordinate
    with other relevant government departments. There is a lot to work
    with. For example, the Federal Bureau of Investigation has an enormous
    amount of data taken from the Saipan offices of the Hong Kong-based
    casino operator Imperial Pacific
        International during their searches in relation to illegal
    activities. It is perplexing why no major changes have been made.
        Other departments have a role to play as well, ideally, in
    coordination with Interior. For example, Interior and the Department of
    Defense could develop a clear reporting mechanism for ICAD activity.
    Once the scope is determined, others could be included through the
    interagency process to counter, including in the FAS.
        Regardless, for any defense plan to be effective, the Department of
    Defense would need to include countering ICAD in its plans for
    assessing and countering threats in the territories (and the FAS).
    Counters could include the Department of Defense substantially
    increasing the appropriate U.S. military presence in the territories--
    including deploying reservists who can help with combating strategic
    corruption--and, in particular, establish a permanent Coast Guard
    presence in American Samoa. This isn't about numbers; this is about the
    right people for the job at hand.
        Other sample blocking actions that could be encouraged and/or
    coordinated through Interior:

         The Department of Homeland Security should require all
                tourists entering CNMI to have the same visas as tourists
                entering the rest of the United States.

         Immigration and Customs Enforcement could publish records
                showing the numbers of foreigners entering CNMI and Guam
                without exiting when their visas expire.

         As recommended by Gov. Leon Guerrero, the territories
                could be supported in setting up national security
                coordinators/councils--and perhaps a regional council--to
                better advise and coordinate, including on countering ICAD
                threats. There are examples of PRC criminals who enter
                Palau using CNMI IDs. Fragmentation of the security
                environment benefits this sort of transnational
                criminality.

         In keeping with the America First Investment Policy and as
                proposed by Alexander Gray: ``Departments of Commerce,
                Treasury, Labor and appropriate regulatory bodies must pay
                particular attention to proposed projects and investments
                from foreign entities in U.S. Pacific territories.'' Also:
                ``Given the scale of PRC operations in the Western Pacific,
                an additional [FBI] field office on Guam and satellite
                offices, appropriately manned, in CNMI and American Samoa
                would support both defensive efforts but also assist in
                wider-regional intelligence and counterintelligence
                operations with Pacific Islands partners.'' The FAS could
                also coordinate with that office.
    Build
        At the same time, proper attention should be paid to finding ways
    to keep the territories economically and socially healthy. This
    requires ground-level assessments, which perhaps could be facilitated
    by OIA field agents.
        One example of a `small' thing that would make a big build
    difference is a waiver from cabotage. Currently, only American carriers
    can fly between U.S. destinations. That has resulted in United having
    an effective monopoly on the Saipan to Guam route, and resulting
    airfares are some of the highest per mile in the world--with a 40-
    minute round trip flight costing around $580. This has put severe
    constraints on CNMI's ability to diversify tourism and develop
    alternative business, and it raises healthcare and education costs.
    Waiving cabotage would mean, for example, that a Japanese carrier could
    fly Tokyo-Saipan-Guam, lowering costs and opening up new markets.
    Indeed, United's role in the region as a whole deserves serious
    attention.

    Other sample build actions:

         Removing bureaucratic barriers to accelerate federally
                funded programs (including around FEMA support post-
                disasters) and implementing centralized tracking and
                oversight of these programs.

         Establishing a center, possibly at the Northern Marianas
                College, that works with the elders and local practitioners
                to research and educate on the political evolution of the
                region, including the Japanese era through the Trust
                Territory and onto the establishment of CNMI and the FAS.
                This is necessary so that narratives aren't hijacked by
                malign external actors, the region rebuilds its bonds, and
                those from Interior, State, Defense, and others who work in
                the area get an understanding of the unique nature of the
                region.

         Prioritizing the establishment of a ferry service between
                Guam and Rota to bring in military tourists and improve
                connectivity. This can offer travel options and growth to
                the people of Rota while forestalling the allure of PRC
                investment in a location so close to Guam.

        Fundamentally, the goal of all of this is to ensure (A) there is a
    risk for those who take Chinese money to sell out their country, and
    (B) the people the people of the American territories are given
    incentives to help them prosper without ever-present illegal, coercive,
    aggressive, and deceptive activity by the PRC.
        As it is now, communities of American nationals and citizens are
    being destroyed, families divided and populations are riven by fear.
    They deserve better.

                Questions Submitted by Representative Radewagen

        Question 1. Ms. Paskal, you have discussed the growing influence of
    China in the region, and point to unlocking the potential of the
    American Samoa fishery as a key way to push back against Chinese
    influence. The Biden administration had initiated a rulemaking to
    expand the Pacific Remote Island National Monument (PRMNM), which would
    prohibit fishing in bountiful waters within the U.S. Economic Exclusion
    Zone. Can you discuss how prohibiting fishing access within the U.S.
    EEZ would put the American Samoa fishery at a disadvantage and thus
    help foreign competitors?

        Answer. IUU fisheries will not be deterred by such prohibitions,
    and currently there is little capacity to protect much of these waters.
    It would be better if there was a U.S. commercial fleet fishing
    sustainably in areas that can support it not only for the benefit of
    U.S. commercial interests, but to add incentive and capacity for
    oversight in these strategically important locations.

        Question 2. Ms. Paskal, you have discussed Illegal, Unreported, and
    Unregulated (IUU) fishing practices from countries such as China. Can
    you discuss how supporting U.S. fisheries such as American Samoa is
    vital to pushing back on IUU fishing practices from foreign competitors
    in the region?

        Answer. Not only would supporting U.S. fisheries incentivize more
    security on the seas, as described above--and ideally through a
    permanent Coast Guard station in American Samoa--it would increase
    security and prosperity onshore by supporting the vital economic engine
    of the cannery in American Samoa.

        Question 3. The number of U.S.-flagged vessels based in American
    Samoa ha been on a steep decline Since 2015, the number of U.S. flag
    tuna fishing vessels, operating in the Western Pacific has fallen by
    over 65 percent. This is due to American Samoa ineligibility for Small
    Island Developing State (SIDS) status due to its status as an American
    territory. This puts U.S.-flagged ships operating in American Samoa at
    a competitive disadvantage compared to others SIDS. Can you discuss the
    importance of allowing vessels based in Pacific territories to operate
    on an equal playing field as foreign competitors?

        Answer. The technical aspect of this question is outside my area
    but, in general, there needs to be an understanding within the U.S.
    government that the operating realities in American Samoa are
    substantially different from the rest of the United States and, in some
    cases, especially those that would increase overall U.S. security--
    including human security--exceptions and adjustments should be made.

                                     ______

        Mr. Hurd. Thank you, Ms. Paskal, for that testimony. The
    Chair will now recognize members for 5 minutes for questions,
    and I will begin by recognizing myself for 5 minutes.
        Certainly, a number of eye-opening and sobering things we
    heard in that testimony. Mr. Cheng, I want to start with you.
    You mentioned in your opening statement that the PRC poses a
    multitude of threats to Pacific territories. In your opinion,
    which of those threats is the most pressing?
        Mr. Cheng. Mr. Chairman, that, unfortunately, is a little
    bit like asking which child do you love the most?
        I would suggest that, on the one hand, because the Chinese
    have more resources, they pose an economic challenge for all
    the reasons that my fellow panelists have noted. This is
    ongoing. This is every day. This is happening as we speak.
        As a defense security-focused analyst, I would say,
    however, that should it come to a conflict, armed conflict, the
    PLA poses a fundamentally different threat than we have ever
    faced before. It is more capable. It has a deeper bench in the
    sense that it has up-and-running munition supply lines. It will
    challenge us in cyber space, it will challenge us in the
    physical infrastructure of information. It will challenge us in
    space capabilities, where the Central Pacific provides key
    support.
        So in terms of day to day, they pose an economic and aid
    and diplomatic threat. But in the background, always present,
    is a looming and increasing military threat that is going to
    undermine the confidence of our allies throughout the region,
    both in the central and western Pacific.
        Mr. Hurd. Thank you, Mr. Cheng. It is multi-faceted, for
    sure.
        A question for Ms. Paskal: How is the presence of illegal,
    unreported, and unregulated, or IUU, fishing by PRC fishing
    fleets in the Pacific territorial waters, how is that impacting
    the economy of these islands?
        Ms. Paskal. It is devastating, and that is combined with
    some policies that America has put in place, including in
    American Samoa, that have made it more difficult for the people
    of the territories to develop the economies themselves.
        And I would also note that often the Chinese fleet has at
    least dual use, if not triple use capabilities. We can see in
    the Philippines the way that the fishing fleet has intimidated
    other navies and coast guards, but also there is often a
    criminal element. So it acts for smuggling, human smuggling,
    drug smuggling, and those sorts of things, as well.
        So it is a multi-faceted, corrosive effect on the economies
    and the societies and the people of the American territories in
    the region.
        Mr. Hurd. So my follow-up was going to be what other
    threats does that IUU fishing pose to Pacific territories. It
    sounds like you went through some of them: smuggling,
    surveillance, harassment, just general economic disruption. I
    assume potentially military----
        Ms. Paskal. Yes.
        Mr. Hurd [continuing]. Quasi-military operations, as well?
        Ms. Paskal. The way that China operates, things are often
    braided. So it will have a commercial front. Oh, you know, we
    are just a commercial fishery, don't worry about it. Then it
    will have a strategic component to it where they just happen to
    be hovering over cables, for example, or surveilling other
    activities. And then there is always this criminal element,
    where there is horrific slavery on the fishing fleets. They are
    smuggling stuff, they are doing bad things.
        So because of those commercial, strategic, and criminal
    elements being all braided together, one recommendation is you
    go after the criminality. You start charging people. You start
    making sure that there is a cost for doing business with the
    sort of ICAD activity that the Filipinos have identified, and
    that will weaken both their commercial argument and their
    strategic footprint.
        Mr. Hurd. Thank you, Ms. Paskal.
        Mr. Klingner, can you talk a little bit about the
    relationship between North Korea and Japan, specifically the
    effectiveness of the potential nuclear threats to the country
    of Japan?
        How effective are those in terms of impairing Japan's
    activities and its coordination with the United States?
        Mr. Klingner. The U.S. has assessed for at least a decade
    that North Korea has nuclear weapons that could be put on
    missiles that could attack Japan. We have also seen North Korea
    has specifically threatened Japan, naming specific cities that
    they would annihilate if Japan were to engage in supporting the
    U.S. or the UN command during a conflict on the Korean
    Peninsula.
        So a Japanese prime minister would be faced with the
    decision of potential attacks on his city with nuclear weapons
    if he allowed the U.S. and the UN command to flow forces
    through the region. So it would be a very dire decision by a
    Japanese prime minister.
        Mr. Hurd. Thank you very much. I yield my remaining time
    back, and at this time I would like to recognize the Ranking
    Member, Ms. Leger Fernandez, for 5 minutes.
        Ms. Leger Fernandez.
        Ms. Leger Fernandez. Thank you, Chairman. And I think that,
    as we listen to today's testimony, what is striking is our
    first two witnesses described in alarming detail the military
    threats posed by China to the United States, but that flows
    through this region. It is scary. You have done your job,
    right?
        But I would also note that many of your recommendations to
    this Committee address issues with regards to what will our
    military do in response. And our House Armed Services Committee
    will look at that really quickly.
        We then moved down the line and heard from our next two
    witnesses about the other aspect of how China is undermining
    the United States' role in this region, and specific
    recommendations about that.
        And I loved, Ms. Paskal, your description of the turmoil of
    going back and forth between this country and that country and
    what it must feel like. We have representatives here who know
    and whose communities tell them what does it feel like when you
    are pushed and abandoned. I think you said it, Mr. Bencosme,
    the yo-yo effect. And so the importance of creating sort of a
    consistency is really key.
        Would you agree, Ms. Paskal and Mr. Bencosme, that the
    importance of having the United States have a consistent
    approach and maintain its commitment not just on the military,
    but on the soft side, the hearts and minds?
        Ms. Paskal or Mr. Bencosme, whoever wants to go first.
        Mr. Bencosme. Absolutely. China feeds and fills in the void
    in unpredictability and in chaos.
        Ms. Paskal. And if I may, the role of the field officers
    from the Office of Insular Affairs are very important for that.
    They live in the country. In fact, one of the best just retired
    in the Marshall Islands, had been there many years. And that is
    the permanent physical presence of somebody who listens and is
    in a position to be able to bridge the gap between Washington
    and 12 time zones away.
        Ms. Leger Fernandez. Yes, it is a long ways away. My eyes
    were opened both in the travel and then in the stories that
    were told there. But when you have an office of about 30 and 4
    are terminated, that ripple effect of the morale, and then the
    ripple effect of what must it feel like to be in country. We
    visited USDA programs. We visited USAID programs. We visited
    many programs where the agencies, as you describe Ms. Paskal,
    are working in collaboration to build that support.
        And especially the Federated States of Micronesia have
    tended to drift closer to China. Is that correct? And Palau is
    under attack and their tourism is under attack. And so, we need
    to think about what are ways in which we need to work to
    strengthen that.
        And Mr. Bencosme, how do we do it? And what are you worried
    about in this moment, where there is chaos coming out of
    Washington itself? How is that impacting our standing in these
    States and territories?
        Mr. Bencosme. It is hugely detrimental to our leadership in
    the region. As I mentioned, we are one natural disaster, in the
    midst of cyclone season, away from USAID demonstrating it can
    no longer respond to something that historically, and as part
    of our compact agreements, we are legally obligated to respond
    to the FAS, and where China has oftentimes used its military
    forces to demonstrate and fill in the vacuum in places like
    humanitarian assistance, undermining our credibility and
    standing in the region.
        Ms. Leger Fernandez. Ms. Paskal, do you also agree that
    maintaining, and in fact, I think you do, because in your
    recommendations you say do more of this, do more of that. But
    would you agree that, to do that more, you actually need the
    people to carry it out? Does it happen without people?
        Ms. Paskal. You need the people and you need the linkage
    back to this town so that the people have the backing that they
    need to be able to deliver on. Again, it is difficult to
    underestimate how much effort the PRC is putting into
    destroying the communities across the territories, because by
    destroying the communities they can weaken the rule of law and
    it is much more easy for their ICAD activities to operate and
    for them to exert influence.
        Ms. Leger Fernandez. Right, which comes back to we have a
    military role to play, but do you agree that USAID plays an
    important role there, Ms. Paskal?
        Ms. Paskal. Across the region, but we are talking about the
    territories kind of less, right? Obviously.
        Ms. Leger Fernandez. All right, thank you so very much.
        I have exceeded my time. I think I took 5 seconds of yours,
    Mr. Chairman, I apologize but I yield back.
        Mr. Hurd. Thank you very much, Ranking Member Leger
    Fernandez. The Chair now recognizes the gentlewoman from
    American Samoa, Mrs. Radewagen.
        Mrs. Radewagen.
        Mrs. Radewagen. Talofa lava, and good morning. This is an
    important hearing for me, as we are talking directly about the
    issues my home of American Samoa faces. So I want to thank the
    Chairman for recognizing enhanced prosperity for American
    Samoa, Guam, and CNMI is vital to the success of the American
    model of democracy in the Indo-Pacific.
        So right now my congressional district is surrounded on
    three sides by countries that have increasingly entered China's
    orbit. And in the past month, independent Samoa and the Cook
    Islands have signed major deals with China. And separating us
    from Hawaii and the rest of the United States is Kiribati,
    which has begun to further align with China. On top of that,
    Chinese fishing vessels have increasingly penetrated American
    Samoa's EEZ in conducting IUU fishing in the region.
        To protect United States sovereignty, and it has been
    mentioned earlier, we must develop the economies of the Pacific
    territories. And to protect American Samoa's economy we need
    actually, a permanent U.S. Coast Guard presence to deter China
    in the region.
        I have quite a number of questions. Most of them will be
    submitted for the record, but I have a couple of questions here
    for Ms. Cleo Paskal.
        What is the current state of critical infrastructure in the
    Pacific territories?
        And would it be correct to say that the Pacific territories
    have severe infrastructure needs, and that if left unaddressed,
    would become threats to national security?
        Ms. Paskal. That is absolutely correct. And its critical
    infrastructure extends to communications, for example. Just so
    people who haven't been there know, when I land in Guam I can't
    use my roaming. And if you try to turn on your phone, your
    charges go up incredibly high. It is everything from the ports
    to the airports to the cables. All of it needs a very serious
    reevaluation and support for improvement.
        Mrs. Radewagen. So Ms. Paskal, would it be fair to say that
    support for critical infrastructure in the Pacific territories
    is vital for fostering economic prosperity, and that it should
    be a top priority for the OIA?
        Ms. Paskal. Yes, it is a key component of both blocking
    ICAD activity and building prosperity.
        Mrs. Radewagen. The PRC has recently signed a number of
    economic agreements with various Pacific Island nations. For
    instance, Samoa has signed a visa exemption agreement with the
    PRC to make travel easier for their citizens. Samoa is home to
    many workers in American Samoa who travel across the border to
    work in our industries, particularly the tuna cannery. At what
    cost and risks do these agreements pose for these nations
    signing these agreements with the PRC?
        Ms. Paskal. You have recently seen incidences in Samoa, for
    example, Chinese national kidnaping somebody and shooting at
    police officers. There is increasing drug use and drug
    distribution. There is very limited ability, and this is
    something that we also see in CNMI, to deport people who are
    creating a problem, and so they sit there and create this kind
    of social destruction. It is extremely disconcerting.
        And I would just flag up that reliance on Australia and New
    Zealand in these areas has not been effective. There have been
    repeated reassurances from Canberra and Wellington, ``Don't
    worry, we have got this covered.'' Canberra set up this
    policing initiative, but we haven't seen the results on the
    ground. And by grabbing that space and blocking direct American
    engagement, I think it has been detrimental to the people of
    the region.
        Mrs. Radewagen. Thank you, Ms. Paskal. Would you agree that
    these agreements come with strings attached, and that the PRC
    can easily use these agreements as leverage to get what it
    wants?
        My time is short.
        Ms. Paskal. Yes. That is, in fact, the purpose of the
    agreements.
        Mrs. Radewagen. And would you also agree that it should be
    a priority for the U.S. Government, including OIA, to remain
    vigilant on the potential impacts of these agreements for U.S.
    national security, especially for the agreements signed with
    countries in close proximity to the United States?
        Ms. Paskal. Yes. They are deliberately setting up
    footprints close to American territories in the FAS in order to
    undermine them for their own strategic advantage. And by
    ``they,'' I mean, of course, the Chinese Communist Party.
        Mrs. Radewagen. Thank you, Mr. Chairman. I yield back the
    balance of my time.
        Mr. Hurd. Thank you. The gentlewoman yields. The Chair now
    recognizes the Chairman of the House Natural Resources
    Committee, the gentleman from Arkansas, Mr. Westerman.
        Mr. Westerman.
        Mr. Westerman. Thank you, Chairman Hurd, and thank you to
    the witnesses for being here today.
        Mr. Klingner, North Korea has been increasing its hostile
    rhetoric towards the Pacific territories. How do you think this
    rhetoric and possibly actions impact the safety of Americans on
    the islands?
        Mr. Klingner. It certainly is an indication of North
    Korea's provocative behavior and its belligerent threats
    towards the region as a component of the threats against U.S.
    forces and citizens and allies, South Korea, Japan, as well as
    the American homeland. So certainly, it is trying to intimidate
    the U.S. and its allies to not respond to North Korean coercive
    behavior or aggressive action if it came to that.
        Mr. Westerman. Thank you.
        Ms. Paskal, kind of following up on Mrs. Radewagen's
    questioning, the OIA does play a very critical role in
    fostering economic prosperity in the territories. Do you think
    it was fair to say that OIA funding is critical for the Pacific
    territories, and it is important to ensure that these funds are
    used in a manner to meet U.S. interests, and obviously doing
    that in a fiscally responsible manner?
        Ms. Paskal. It is foundational, and it would be
    particularly helpful if it is combined with proper oversight so
    there is transparency and there is trust across the board that
    these funds are being used properly.
        Mr. Westerman. And can you give any specific examples how
    OIA activity has positively impacted the territories?
        Ms. Paskal. There are a lot of very effective technical
    training programs. In my testimony I suggest expanding them out
    to be able to counter corruption, because corruption is
    undermining a lot of the other good efforts that are being
    made. So yes.
        Mr. Westerman. Maybe talk about how some of those efforts
    have played a role in countering the PRC's malign activities in
    the area.
        Ms. Paskal. You mean specific funding to something else?
        Mr. Westerman. Or ways that the OIA efforts have played in
    countering the PRC's malign efforts.
        Ms. Paskal. Well, having those knowledgeable field officers
    in country, and building trust and being able to convey
    information back and forth between Washington and the region
    has been essential.
        Mr. Westerman. All right. And again, the importance of the
    territories to the United States I don't think can be
    overstated. Can you elaborate a little bit more on how the
    Pacific territories are vital to U.S. national security and the
    economy?
        Ms. Paskal. Sure. Well, they are the United States, and
    those are American citizens and American nationals, and they
    are being repeatedly targeted with things like co-panelists
    talked about in terms of the Guam killer missile, for example,
    or attempts to undermine their societies. They are a key
    component of the Trump administration's concept of hemispheric
    defense. They are America's Western border. And as such, they
    are being heavily targeted by the PRC in a similar way to
    undermine American security as a whole that you see a vast
    number of very odd people coming across the southern border,
    for example.
        Mr. Westerman. Thank you. Thank you again to the witnesses
    for being here today.
        And I yield back.
        Mr. Hurd. The gentleman yields. The Chair now recognizes
    the gentleman from California, Mr. LaMalfa.
        Mr. LaMalfa.
        Mr. LaMalfa. Thank you, Mr. Chairman. I appreciate it. I
    had a question for Mr. Cheng on the issue of the Department of
    the Interior and drones that they are in the possession of that
    have been produced by some, I would say, pretty questionable
    sources here. One is DJI and the software would be from Autel
    Robotics. Forgive me if you talked about this earlier, I was at
    a previous stop for a little bit.
        But these are both, again, Chinese-based companies that are
    known to be high security threats. Autel is linked to the PRC
    and their military directly, and our own Pentagon has
    blacklisted Autel Robotics, citing this threat. So I wonder why
    in the world would the Department of the Interior be using a
    product that our own Pentagon has blacklisted as being a
    threatening source of, you know, tracking whatever information
    might be pertinent that Interior is gathering or holding.
        Mr. Cheng. Congressman, I am certainly not in a position to
    explain the actions of the Department of the Interior.
        What I would say is the following, that first it is
    absolutely clear that Chinese robotic companies, like most
    Chinese companies, are part of the comprehensive threat posed
    to the United States. Chinese national security law has made
    very clear: one, all data must be stored in the PRC; two, that
    data will be accessed by relevant Chinese authorities,
    including the Ministries of Public Security, Ministry of State
    Security, and the People's Liberation Army at such time that
    any of those Chinese entities feel that it is incumbent or
    necessary to do so, there is no right to privacy, there is no
    restrictions, certainly no equivalent to any of the safeguards
    that are present in our system; third is that the Chinese have
    made very clear through things like Made in China 2025 that
    they intend to dominate the global market for robots and
    drones, whether it is desktop or whether it is larger,
    strategic-level counterparts of things like our Global Hawk
    system.
        All that being said, the Chinese have therefore succeeded
    through subsidies and, honestly, through efficient production,
    to make drones that work that are extremely inexpensive. And if
    I were to make a guess, and again, I want to emphasize, I am
    not personally aware of how the Department of the Interior
    makes its decisions, I would guess that they went with a
    lowest-bidder strategy without necessarily considering
    potential implications of loss of control of data.
        Mr. LaMalfa. Yes, yes, I appreciate that. I don't expect
    you to know the whole ins and outs of what Interior is doing.
    But I guess, as an overview, it seems probably a little
    dangerous that we would be having that Department using this
    type of technology that is so easily absorbing information and
    sending it right back to PRC, right?
        Mr. Cheng. Sir, given the purview of the Department of the
    Interior, which goes, obviously, beyond the Office of Insular
    Affairs, the Department of the Interior has knowledge of vast
    tracts of American land where oil drilling would occur, where
    other natural resource exploitation would occur. The drones
    would almost certainly be used to survey that land, and the
    Chinese would therefore be aware of, one, what is being
    surveyed and potentially what areas would be opened for leasing
    and other contractual arrangements.
        Recent discussions about Chinese acquisition of farmland
    has focused on where that farmland is, not the amount, but the
    location, which is often very close to sensitive and strategic
    sites.
        Mr. LaMalfa. Right.
        Mr. Cheng. I would suggest that that would include not only
    military, but also Department of the Interior sites.
        Mr. LaMalfa. Thank you. I appreciate that complete answer.
        Mr. Klingner, we have heard a lot about USAID and some of
    the really horrific expenditures that have been pushed through
    that, and the efforts of DOGE to narrow it back down to
    something that would be really the original mission of USAID.
    What would be the concerns about that, and then the possible
    overall effect in reduction of efforts? Some are contending
    that we are losing our place in the South Pacific by not having
    full funding of USAID as it was.
        Mr. Klingner. My apologies, sir, but the USAID is outside
    of my area of responsibility and expertise. There are other
    colleagues at the Heritage Foundation who could respond to that
    much better than I.
        Mr. LaMalfa. We don't have them here today. I know the
    Foundation has done a lot of work in that area. What do you
    surmise is the direction for that?
        Mr. Klingner. The overall direction would be that contracts
    have been let on issues that are not in either the best
    interest of the United States or excessive funding has been
    devoted to them.
        Mr. LaMalfa. Yes, OK. My time is already up.
        I yield back, Mr. Chairman, thank you.
        Mr. Hurd. Thank you, Mr. LaMalfa. The Chair now recognizes
    the gentlewoman from Oregon, Ms. Hoyle.
        Ms. Hoyle.
        Ms. Hoyle. Thank you. I yield my time to Congresswoman
    Leger Fernandez.
        Ms. Leger Fernandez. Thank you very much, Congresswoman
    Hoyle, and thank you for attending the hearing.
        And as I have mentioned to the Chair, I really look forward
    that we will be invited and be able to travel back and learn
    from our colleagues about what is happening, especially our
    colleagues who represent these incredibly important, I hate
    saying territories, but I guess that is the official word.
        So a question was asked about the USAID cuts, and Mr.
    Klingner mentioned that it wasn't his area of expertise, but
    that there were those who could answer that. We actually have
    somebody who it is his area of expertise.
        So Mr. Bencosme, would you respond to that question?
        Mr. Bencosme. Thank you so much, Congresswoman.
        Every administration has the authority and power to set new
    priorities. And so I think what is most disturbing about these
    cuts is that it really takes the baby out with the bath water.
    You can change the direction of priorities and types of
    programs that USAID does, but to destroy the entire development
    tool, to sell our offices or my previous employees' offices to
    the Customs Border Patrol, to lose generations of expertise,
    capacity, leadership in these important capabilities has a real
    detrimental effect to our national security.
        Ms. Leger Fernandez. Right. And I think what is really also
    important is, as Ms. Paskal noted, that the OIA is very small.
        And so when you have USDA, when you have USAID, you are
    increasing and supplementing the Americans on the ground,
    building trust. And I would ask this, Mr. Klingner. Do you
    believe it is important that our allies feel that they can
    trust the United States to live up to its commitments?
        Mr. Klingner. Very much so. That is one of the things that
    the U.S. should make very clear to our friends and foes, that
    we will abide by our treaty commitments, that our forces not
    only in the region, but follow-on forces would be there to
    hopefully deter or, if necessary, defend and defeat any attacks
    by North Korea or China on our allies or our strategic
    interests in the Indo-Pacific region.
        Ms. Leger Fernandez. And wouldn't you agree that trust is
    built by actually having a history of consistency, Mr.
    Klingner?
        Mr. Klingner. Very much so. We have had forces on the
    Korean Peninsula for 70 years. And recently the Trump
    administration affirmed the U.S. commitments, the ironclad
    commitments to defend our allies, and we saw that in, you know,
    President Trump's joint statement with Japanese Prime Minister
    Ishiba affirming our commitments to Japan.
        And then also Secretary of State Rubio has affirmed and
    Secretary of Defense Hegseth have also affirmed our commitment
    to defending South Korea.
        Ms. Leger Fernandez. Yes. And so I think that the real
    important thing is that when there is the yo-yo, when there is
    in different parts of the international stage a swinging back
    and forth of who we stand with and who we will not abandon,
    that that erodes trust. Because when you abandon one ally, when
    you engage in a tariff trade war with others like Canada and
    Mexico, you are creating a sense of distrust in the United
    States.
        I also want to thank the questions that our Chair talked
    about in terms of the importance of the office of the OIA, and
    I hope that the Committee will support additional personnel and
    additional funding for what has been described as a really
    essential office. So I do appreciate those.
        And I yield back my time to Ms. Congresswoman Hoyle, if she
    wants to add anything else.
        Mr. Hurd. Nothing else? Nothing further? OK.
        Ms. Hoyle. Nothing else. I yield again.
        Mr. Hurd. Thank you very much, Ms. Hoyle.
        The gentlewoman yields her time back. The Chair now
    recognizes the gentleman from Guam, Mr. Moylan, for 5 minutes.
        Mr. Moylan.
        Mr. Moylan. Thank you, Mr. Chairman, for this important
    hearing today, and thank you to the panel for all the
    information, professional information, that you provide. This
    is all very helpful, and I appreciate your time and effort.
        More than a quarter of a million Americans live in Guam,
    CNMI, and American Samoa. For decades our islands have been
    critical for national security and regional stability in the
    Pacific. Moreover, Americans in the Pacific territories serve
    at a higher rate than anywhere else in our nation, me included.
        Guam hosts three key bases which serve as a key logistical
    hub essential for the movement of personnel and supplies
    throughout the INDOPACOM. Additionally, Guam serves as the home
    port hub for submarines and supply ships, playing a crucial
    role in determining the rising threats from PRC and North
    Korea. Additionally, OIA provides essential funding for the
    territories and Freely Associated States, protecting our
    economy and national security. For Guam, these funding stems
    are critical for providing public service, increasing economic
    development, and protecting Americans in the western Pacific.
        But despite this, many programs for the territories remain
    unfunded and have not been adjusted for years. We must work to
    increasing funding for OIA to deal with problems such as the
    invasive and stray animal control, IUU fishing, and counter
    narcotics operations. And over the last several years
    methamphetamine use has skyrocketed, creating a public health
    and safety crisis. And recently we have even seen fentanyl
    enter our shores.
        We must take a nuanced approach to territorial policy-
    making. These issues that we have in Guam are not the same we
    face in our neighbors just 16 miles north. One-size-fits-all
    policies ignores the territory's unique situation, and we have
    the potential to negatively impact our economies, education
    institutions, and health care systems.
        And just one final statement. USAID, is not offered to the
    territories. This is all international-based, but it should be.
    And this is where we need the additional funding.
        So with that said, Mr. Chairman, I have no questions, but I
    wish to yield the balance of my time to my friend from the
    Northern Marianas, Mrs. King-Hinds. Thank you, Mr. Chairman.
        Mr. Hurd. The gentleman yields his time to Mrs. King-Hinds.
        Mrs. King-Hinds.
        Mrs. King-Hinds. Do I still get my full 5 minutes?
        Mr. Hurd. Yes, ma'am, you do.
        Mrs. King-Hinds. All right, Mr. Chairman, members of the
    Committee, thank you for the invitation, or the privilege today
    of joining today's hearing.
        I am the only representative from the Northern Mariana
    Islands, so it is my duty to speak on behalf of the Americans
    who live there.
        I will, in short order, be introducing a bill asking
    Congress for a $400 million bailout, as requested by my
    governor, because the CNMI is on the cusp of an economic
    collapse.
        And Mr. Chairman, I would like to submit for the record the
    CNMI Governor's letter requesting bailout legislation.
        Mr. Hurd. Without objection.

        [The information follows:]

                  Commonwealth of the Northern Mariana Islands

                            Office of the Governor

                                                  February 14, 2025

    Hon. Kimberlyn King-Hinds
    House Natural Resources Committee
    1324 Longworth House Office Building
    Washington, DC 20515

        Dear Congresswoman King-Hinds,

        I appreciate the opportunity to have met with you previously and am
    grateful for your attention to the issues we discussed. In our initial
    conversation, I respectfully mentioned the letter we sent to the Biden
    administration regarding our request to access the unused Pandemic
    Unemployment Assistance (PUA) funds ($231 million) and the Federal
    Pandemic Unemployment Compensation (FPUC) funds ($183 million) for a
    total balance of about $414 million.
        I am now writing to urgently request your support for legislation
    allowing the Commonwealth of the Northern Mariana Islands (CNMJ) to
    retain unused Pandemic Unemployment Assistance (PUA) funds from the
    American Rescue Plan Act.
        The downturn in tourism across the region has been exacerbated by
    the strength of the U.S. dollar, making travel to the CNMI less
    affordable for international visitors. Additionally, external factors
    such as geopolitical tensions and the global economic impacts have
    further complicated recovery efforts.
        To address this, our administration has actively supported
    diversification to secure new tourist markets and fostering other
    industries to reduce our dependency on a single sector. However, these
    efforts need financial support to truly take effect.
        Retaining these funds would enable us to:

         Stimulate economic recovery

         Strengthen critical public services

         Support the transition to a more resilient economy by
                aiding businesses and workers in both traditional and
                emerging sectors

        Your leadership and our collective efforts are crucial for our CNMI
    community's recovery and sustainable future. I appreciate your
    attention to this urgent matter and look forward to your support.

                Respectfully,

                                            Arnold I. Palacios,
                                                               Governor

                                     ______

        Mrs. King-Hinds. I have been writing letters to every
    agency requesting to spare the CNMI from any cuts to grants or
    federally funded personnel, because our economy is dependent on
    these funds and positions for survival.
        We may all be from the territories and share similar
    challenges, but our economic challenges are very different and
    unique to each of us.
        Our governor just refinanced a loan to cover the remainder
    of this year's fiscal budget. That budget doesn't fully fund
    operations. The police department on the island of Rota does
    not have money for gas because the budget doesn't fund
    operations for gas. And so the cops can't patrol there. Legacy
    businesses like the Hyatt have shut down. Duty-free shoppers
    has just announced that it too will be closing shop.
        Every day, when I leave here at 5:30 and the Marianas day
    begins, I go home at night I field phone calls from more legacy
    businesses who are talking about shutting their doors because
    we don't have enough tourists to keep the door open. Our
    industry is primarily driven by tourists.
        The Commonwealth Ports Authority is begging for relief.
    Because of the current rate of tourist arrivals, it cannot
    sustain operations. We have Department of Defense activities
    that rely on the ports being fully operational for the ongoing
    training and construction activities critical to our national
    security. And this is why sometimes having these conversations
    are very frustrating, because too often, you know,
    conversations about the CNMI and the territories happen about
    us instead of with us from individuals who have never
    experienced life there. And too often discussions about
    national security treat our people as a liability, rather than
    an asset.
        We, as Americans, cannot be expected to stand strong if the
    CNMI is economically starved into collapse, which is what is
    happening now. People are going hungry. And when people are
    going hungry, they are going to do stupid things.
        This hearing is about prosperity in the Pacific and
    acknowledgment that prosperity does not exist there. And all I
    have heard since coming to Congress are proposals for more
    restrictions because of geopolitical tensions with China,
    restrictions to tourism that will only make things worse. I
    agree with everything that everybody has said on this panel. We
    are on the same team, and we agree that we must all do our part
    to address these threats.
        Mr. Hurd. Mrs. King-Hinds, Mr. Moylan's time has expired.
        Mrs. King-Hinds. OK.
        Mr. Hurd. But we will come back to you in just a bit. The
    Chair now recognizes the gentleman from Puerto Rico, Mr.
    Hernandez for five minutes.
        Mr. Hernandez.
        Mr. Hernandez. Thank you, Mr. Chairman.
        Ms. Paskal, in your testimony you highlighted concerns that
    the PRC could influence the residents of Guam, American Samoa,
    and the CNMI to push for independence. A common line of attack
    that foreign adversaries use against U.S. territories and
    commonwealths is that any form of territorial status is
    undemocratic. Do you believe that Congress can enter into
    democratic relationships with its territories in the Pacific
    through, for example, a covenant like the Mariana Islands?
        Ms. Paskal. The beauty of the covenant is that it was
    widely debated within CNMI, and it was voted on by the people
    of CNMI. So that is a consensual relationship entered into with
    knowledge and dedication. And the people of CNMI are some of
    the most dedicated Americans I have ever met.
        Mr. Hernandez. So the answer would be yes.
        Ms. Paskal. Yes.
        Mr. Hernandez. And do you think it is legitimate for
    territories like American Samoa to decide on their own that it
    is a fair trade-off, for example, not to vote for the President
    of the United States, but to have their own system of land
    management and be able to protect that?
        Ms. Paskal. Yes. In the end of my written testimony I sort
    of describe how different everybody is. Of course, I didn't
    include Puerto Rico because it wasn't part of the remit, but
    they are all incredibly different. And American Samoa entered
    into the relationship with the U.S. as an equal negotiator,
    state-to-state relationship, and made their decision the way
    they did.
        Mr. Hernandez. Thank you, Ms. Paskal. And I completely
    agree, and I really hope that this Committee in the future
    takes all that into account. Self-determination is a two-way
    street, and the people of the territories and commonwealths
    have a right to decide their own future, and that should
    include any option that the people in the territories and
    commonwealths want to pursue in accordance to their history,
    their interests, and their democratic values. So I appreciate
    your answers.
        Mr. Bencosme, we know that the U.S. has Freely Associated
    States, it has territories, it has commonwealths. And
    commonwealths are not just plain territories. From a national
    security perspective, are the territories and commonwealths
    better protected from foreign influence than the Freely
    Associated States?
        Mr. Bencosme. So my area of expertise is mainly on the
    Freely Associated States, but I should say that, you know,
    because of the compacts that were just recently renewed, we
    have been able to provide assistance which helps bolster
    resilience against foreign influence from adversaries like
    China and North Korea.
        Mr. Hernandez. And given the current political climate,
    would you say that the commonwealths and territories financing
    is more secure than the Freely Associated States under USAID?
        Mr. Bencosme. So USAID used to operate in the Freely
    Associated States, and we did not operate in, you know,
    commonwealths or any territories.
        Mr. Hernandez. Correct. But given the current political
    climate, do you think that financing and assistance to the
    Freely Associated States is under threat, given what is
    happening at USAID?
        Mr. Bencosme. I do. And in fact, for 2 weeks people at
    Interior did not know if the COFA funds were at risk because of
    the attacks on foreign assistance.
        Mr. Hernandez. Right. Thank you.
        With that I yield back the remainder, oh, I see. Let me
    see. One second.
        One last question I do have is it has been decades since
    the Organic Act and the covenant have been revised. Would it be
    positive for the relationships and the democratic nature of
    these relationships for Congress to engage with the territories
    and commonwealths to periodically revise and enhance these
    arrangements, Ms. Paskal?
        Ms. Paskal. That is a decision for the people of those
    locations. That is definitely beyond my remit. I am Canadian. I
    have no say in understandings between Americans and their
    government.
        Mr. Hernandez. Of course. But if they wanted to, would that
    be a legitimate exercise of democratic self-government?
        Ms. Paskal. Any discussion like that is legitimate. I would
    highly recommend at the same time that there be not operations,
    but there be an awareness of how outside actors will launch
    influence operations to try to affect those outcomes, and that
    can be countered very easily through transparency. So if we
    have a better idea of who is funding what on all sides, then it
    will lead to, I think, more transparent discussions on this
    topic.
        Mr. Hernandez. Thank you.
        And I yield back.
        Mr. Hurd. Thank you. The gentleman's time has expired. The
    Chair now recognizes the gentlewoman from the Commonwealth of
    the Northern Mariana Islands, Mrs. King-Hinds.
        Mrs. King-Hinds for 5 minutes.
        Mrs. King-Hinds. I apologize for going over, Mr. Chairman.
        So as I was saying, this hearing is about prosperity in the
    Pacific and acknowledgment that prosperity doesn't exist here.
    And all I have heard since coming to Congress are proposals for
    restrictions because of geopolitical tensions with China,
    restrictions that I believe will only make things worse.
        And as I have said, we are all on the same team, and we
    must all do our part. You know, since I have been here I have
    been hearing a lot about birth tourism. And let's be clear, we
    all agree that birth tourism is a concern. But it is also very
    misleading to suggest that the CNMI has been lax on the issue.
    We are the only jurisdiction through the covenant who has taken
    real action, urging Congress to amend birthright citizenship
    for tourists coming into the CNMI. But Congress has never
    acted.
        Under President Trump we partnered with the White House to
    enhance Chinese tourist screening, creating EVS-TAP, a program
    delayed for 4 years under the Biden administration before
    finally being implemented. And today I am working to strengthen
    oversight of foreign investments. Yet despite all of this, I
    haven't heard from a single national security official, not
    even the Department of Defense over the last 10 years, whom I
    have been directly engaging with has confirmed that tourism
    from China itself is a threat. If it is good for California,
    why is it not good for the commonwealth so that we can put food
    on the table?
        The only answer that I have been getting is that the
    biggest risk to national security is a collapsed CNMI economy,
    and that is why I am here fighting to restore tourism from all
    markets. They can be from Mars, for all I care. That is why I
    am urging Secretary Rubio to mobilize embassies in Japan, South
    Korea, Australia, and the Philippines to secure real support
    for other markets. That is why I am pushing for deregulation,
    expanded labor access, and economic relief, not restriction, as
    some of the written testimonies have suggested, but actual
    support that doesn't cost Federal taxpayers anything.
        We can't compete with the mainland for investment or
    tourism. We don't have oil, we don't have labor, and we face
    severe geographic and economic constraints. We don't want the
    status quo, but one-size-fits-all Federal policies leave us
    with no options. It is like putting baby in a corner, you know
    what I mean? And that is kind of the position that I am in
    right now as the delegate.
        And so, you know, what is the proposal? Basically, I
    haven't really heard a proposal. I have heard proposals for
    restrictions. But what are proposals basically for supporting
    economic opportunities in the CNMI? And so this question, then,
    is to Ms. Paskal.
        In your testimony you proposed requiring visas for
    tourists, including Japan and South Korea, which are two of our
    other primary markets.
        Ms. Paskal. I am sorry, no, I don't. I think that people
    coming into any part of the United States should have the same
    entry points. If you are coming in, if you are Chinese coming
    into California, you need a visa. And as you have said, Chinese
    tourism in California is just fine. Why would it affect Chinese
    tourism to CNMI?
        And just on this point of why PRC tourism is a threat, you
    just ask Palau. I mean, as you said, economic collapse is your
    biggest threat. And the PRC deliberately used tourism to try to
    economically collapse Palau in order to gain strategic
    advantage, in this case getting them to de-recognize Taiwan.
        Mrs. King-Hinds. Thank you for pointing that out, and thank
    you for using Palau as an illustration of these influences,
    right? But what creates these opportunities for influence? Is
    it not economic collapse? Is it not economic vulnerability?
        Ms. Paskal. Yes, which is why you can do things. I mean,
    there are a bunch of recommendations. I did make
    recommendations. For example, look at cabotage, look at a fast
    ferry between Guam and Rota.
        Mrs. King-Hinds. A ferry between Guam and Rota?
        Ms. Paskal. Yes, yes. I mean, there are all sorts of little
    tweaks that you can do that can provide sustainable sorts of
    development that are beyond the tourism sector that help the
    people of CNMI in multiple different ways.
        Mrs. King-Hinds. So has there been an economic analysis
    that anybody has looked at or reviewed or suggested to show
    that if you completely take out the tourism industry, that that
    hole can be filled in order to be able to support basic
    government services?
        Ms. Paskal. So the idea isn't to take out the tourism
    sector. The idea is to isolate the sector of tourism that is
    incredibly unreliable, that comes and goes, that uses itself
    for economic leverage for political and strategic advantage.
    The United States could decide tomorrow that no Chinese tourist
    can come into the U.S. And if CNMI has built up its tourism
    around Chinese tourism, it is going to be incredibly
    vulnerable.
        Cabotage would greatly increase the chances of increases in
    Japanese tourism, for example.
        So, you know, for those who don't know this issue, in the
    U.S. you can't have a foreign carrier flying between two points
    in the U.S. So you can't have a Japanese airline that flies to
    Saipan and then to Guam. If a Japanese carrier could do that,
    that would greatly lower costs for the people of CNMI and Guam
    to travel in the region and take away some of that choke hold
    that United has, which affects all sorts of other economic
    growth factors, and it would increase Japanese tourism.
        Mrs. King-Hinds. And all this based on an opinion, but not
    based on an actual economic analysis that assesses what the
    real economic underlying challenges are, like remote geography.
        Ms. Paskal. It----
        Mrs. King-Hinds. And cost of transportation.
        Ms. Paskal. Yes, so CNMI isn't actually that remote if you
    can unlock the transportation in the region. If you can get out
    of that United Airlines choke hold that that has on the region,
    you are actually not very far away. And you have access. Guam,
    for example, has all sorts of access all over the region.
        And you can build up other sectors like health. You know,
    people from the FAS need better health care, and there could be
    health centers and education centers in CNMI. The college in
    Northern Marianas could be really built up to be a comfortable
    place for the people from FAS to come and study and learn more
    about their cousins across the region.
        Mr. Hurd. Mrs. King-Hinds----
        Mrs. King-Hinds. I yield my time.
        Mr. Hurd [continuing]. Your time has expired.
        Mrs. King-Hinds. Thanks.
        Mr. Hurd. Thank you very much. The Chair now recognizes the
    gentleman from Utah, Dr. Kennedy.
        Dr. Kennedy for 5 minutes.
        Dr. Kennedy. Good morning, Mr. Chair, and thank you to you
    and the Ranking Member for organizing this Committee and
    putting this oversight to allow us, as Congress, to have
    greater insight into threats facing the U.S. territories and
    the Freely Associated States.
        I am really appreciative of the witnesses for bringing
    yourselves all the way here to this place, as well. We are
    grateful to have your testimony.
        I am committed to working with Congress and the Trump
    administration to maintain military and economic security in
    the Indo-Pacific, and had a question for Mr. Cheng.
        In 2023 a PRC-backed hacking group called Volt Typhoon
    hacked telecommunications systems in Guam. These hacks attacked
    critical infrastructure in the island, including those used by
    the U.S. military bases. So in our present day is the PRC still
    actively attempting to launch cyber attacks against the U.S.?
    And if so, in what ways?
        Mr. Cheng. Sir, in the wake of Volt Typhoon, various
    cybersecurity groups in the U.S. Government have identified at
    least two new Chinese-sourced attacks in just simply the
    typhoon series Salt Typhoon, which involved Chinese penetration
    of various U.S. telecoms, including Verizon and AT&T, to obtain
    remarkably granular data on various users. It is believed that
    this has included the cell phones of Vice President Vance and
    then President-elect Trump.
        We have also seen an attack labeled Flax Typhoon, Chinese
    cyber attacks on Taiwanese organizations. This basically is a
    form of living off the land where basically, rather than
    introducing malware, they are using already existing tools,
    security systems, et cetera built into programs. Those are just
    simply two examples simply from a particular family of Chinese
    hackers.
        More broadly speaking, there is no evidence that I am aware
    of with regards to a reduction in Chinese cyber economic
    espionage, Chinese hacking of various organizations around the
    world, not just the United States, but our allies, military,
    economic, et cetera. There is every reason to believe that the
    Chinese, if anything, have redoubled their efforts as the
    Chinese pursue what they term intelligencization of their
    military and economy, which is basically promoting the ability
    of machines to talk to machines going beyond the previous
    people talking to people and organizations talking to
    organizations.
        Dr. Kennedy. Thank you for that very disturbing report. I
    am sorry to hear that. So how do the attacks, outside of what
    you have said about President Trump and Vice President Vance,
    how are these attacks affecting our citizens that live in the
    territories or the citizens that live in the continental United
    States?
        Mr. Cheng. So with regards to the citizens in the
    territories, it basically means that military personnel, but
    also civilians, politicians, police officers, potentially have
    their personal data being accessed. That in turn, of course,
    opens them up to potential recruitment as human intelligence
    sources pressure.
        Because of the comprehensive approach that I mentioned
    earlier to Chairman Hurd, what that also means is that, for
    example, in theory, Chinese companies could use this to
    pressure their way into access. If Chinese criminal
    organizations were to access this kind of information, they too
    would potentially be able to exploit it.
        With regards to on the mainland, my understanding is that
    one of the things that may have been exposed through Salt
    Typhoon is access to wire taps, not just legal wire taps in the
    sense of criminal, but potentially intelligence-oriented
    wiretaps authorized under FISA. That would obviously expose
    intelligence operations, potentially sources and methods.
        Dr. Kennedy. Thank you for that answer, as well.
        So we know China is constantly undermining the United
    States by mistreating U.S. territories, allies, and stealing
    American intellectual property. That is why I introduced the
    United States Research Protection Act. This legislation removes
    ambiguity in what qualifies as a malign foreign talent program,
    and ensures there are no loopholes in its language that could
    inadvertently allow adversarial nations like China to exploit
    American research and technology for their own benefit.
        By closing these critical loopholes, the United States
    Research Protection Act ensures that our technological
    advancements remain secure and safeguarded from foreign
    exploitation. It also reaffirms a commitment to protecting
    American taxpayers by ensuring that their investments in
    research and development are not used to subsidize the
    capabilities of our strategic competitors such as the Chinese
    Communist Party.
        And Mr. Chair, I will thank again these witnesses for
    coming and testifying with us, and with that I yield back.
    Thank you.
        Mr. Hurd. The gentleman yields. Thank you very much, Dr.
    Kennedy. I want to also thank the witnesses for their valuable
    testimony and my fellow members for their questions.
        The members of the Committee may have some additional
    questions for the witnesses, and we will ask that you respond
    to those in writing. Under Committee Rule 3, members of the
    Committee must submit questions to the Committee Clerk by 5
    p.m. on Monday, March 10, 2025. The hearing record will be held
    open for 10 business days for these responses.
        If there is no further business, without objection, the
    Committee stands adjourned.

        [Whereupon, at 11:39 a.m., the Subcommittee was adjourned.]

                [ADDITIONAL MATERIALS SUBMITTED FOR THE RECORD]

    Submissions for the Record by Rep. King-Hinds

                  Commonwealth of the Northern Mariana Islands

                            Office of the Governor

                                                      March 4, 2025

    Hon. Kimberlyn King-Hinds
    House Natural Resources Committee
    1324 Longworth House Office Building
    Washington, DC 20515

        Dear Congresswoman King-Hinds,

        Thank you for your March 3, 2025 letter requesting the expenditure
    plan for the requested repurposing of the $414 million in un used CARES
    Act Pandemic Unemployment Assistance (PUA) and Federal Pandemic
    Unemployment Compensation (FPUC) funds.
        In response to your inquiry, I have attached a breakdown of
    critical priorities that these funds will address:

         Economic Recovery--$231 million

         Strengthen Public Services--$120 million

         Public Health Priorities--$55 million

         Community Enhancement--$8 million

        This plan includes funding for economic recovery through tourism
    and airline support initiatives, as well as other initiatives that
    would promote private sector growth. I have included restoration of
    revenue losses for the central government and autonomous agencies to
    respond to the impact of a post-pandemic recovery.
        As you noted, this effort may be improbable and I understand this
    may be a challenging request to the U.S. Congress, however the passage
    of such legislation will provide urgent economic assistance to the
    Commonwealth at a time when economic recovery is essential to our
    livelihood. Your support and efforts to advance this funding
    flexibility through the legislative process is important and
    appreciated.

                Sincerely,

                                            Arnold I. Palacios,
                                                               Governor

    Economic Recovery $231 million
    Tourism and Airline Support
        The Marianas tourism sector welcomes visitors from around the
    region and the world. Not only has it brought a resurgence of the
    important Japan market, but has expanded to welcome visitors from
    Australia, New Zealand, Singapore, and the Philippines, among others.
    This creates greater stability against external forces and ensures the
    continued viability of the economy in the long term. The Marianas
    Visitors Authority (MVA) is the primary agency responsible for the
    Marianas tourism product, funding proposed will enable MVA to engage in
    promoting the CNMI as a tourist destination. Funding allocated to the
    Marianas Visitors Authority (MVA) is to provide incentives to stimulate
    economic recovery through the revitalization of the tourism industry,
    restoration of travelers' confidence in traveling to the CNMI, and
    increased overall destination exposure. The MVA will be able to conduct
    promotional and marketing activities for target tourist markets,
    including locally sponsored events and improved attractions. The
    development of tourism products for Rota and Tinian as well as major
    tourist attraction centers are expected.
        This funding will also enable MVA to initiate new air service
    investor discussions, alongside the Commonwealth Economic Development
    Authority (CEDA) and work collaboratively to provide the necessary
    information, investor material, and incentives to see the successful
    acquisition of new routes. The total number of tourists visiting the
    Marianas is directly correlated with the number of seats flying to its
    airports. This includes start-up incentives, promotion, and investor
    missions.
    Commonwealth Ports Authority Support
        The Commonwealth Ports Authority (CPA) plays a critical role in the
    CNMI's economy, facilitating the importation of goods and exports.
    Airport operations were disrupted in 2018 due to damages of major
    infrastructure following the destruction of Super Typhoon Yutu. Damages
    include the control tower, the domestic terminal and the jetways were
    all detached and twisted by the force of a Category 5 storm. Yutu's
    destruction was catastrophic prompting the cancellations of flights
    from our main source of tourism markets (Korea, Hong Kong and China).
    Infrastructure repairs are near completion with airports in operation.
    However, the COVID-19 pandemic has significantly impacted CPA's revenue
    streams, exacerbating existing financial challenges. This funding will
    provide essential support to CPA, enabling the authority to maintain
    operations, invest in infrastructure upgrades, provide airline
    incentives program and promote economic growth.
    Commonwealth Ports Authority Operational Support
        The CPA requires operational support to ensure the continued safety
    and efficiency of port operations. This funding will be utilized to
    cover program and operational expenses, including personnel costs,
    maintenance, and equipment upgrades. By providing this support, we can
    ensure the CPA remains operational, supporting the CNMI's economic
    recovery and growth.
    Commonwealth Economic Development Authority (CEDA)
        With the environment of significant economic uncertainty in the
    Marianas, business investment, development, growth, and retention are
    goals that require concerted effort to achieve. Funding provided to
    CEDA will go toward developing programs that assist entrepreneurs'
    access to capital to ensure the success of their businesses. Affordable
    and low-cost financing helps to promote greater levels of small and
    medium-sized businesses in the Marianas as well as support business
    retention.

        D Support Business Retention Initiatives

        The CNMI's business community has been severely impacted by the
    COVID-19 pandemic, with many enterprises facing significant challenges
    to remain operational. This funding will support business retention
    initiatives, providing critical assistance to struggling businesses and
    helping to preserve jobs.

        D Utility Assistance for Businesses

        Many businesses in the CNMI are struggling to pay utility bills,
    exacerbating their financial challenges. This funding will provide
    utility assistance to eligible businesses, helping to alleviate
    financial pressures and support business continuity.

        D SBDC-Payroll Protection Program

        The Small Business Development Center (SBDC) plays a vital role in
    supporting the CNMI's small business community. This funding will
    support the SBDC's Payroll Protection Program, providing critical
    assistance to small businesses to help them retain employees and
    navigate the economic challenges posed by the pandemic.

    Strengthen Public Services ($120 million)

        D Restore Revenue Loss to Autonomous Agencies and Central
                Government

        The COVID-19 pandemic has resulted in significant revenue losses
    for autonomous agencies and the central government. This funding will
    help restore these revenue losses, ensuring that essential public
    services can be maintained.

        D Restore Lost Wages from 2020 to Current for Government Workers

        Due to the government's revenue loss from its tourism economy,
    implementation of a reduction in work hours was necessary to mitigate
    the revenue shortfall while maintaining government basic operations of
    public services. The government implemented furloughs and those who
    remained experienced 20% wage reductions. This funding will help
    restore lost wages, recognizing the critical role government workers
    play in delivery of essential public services.

        D Extension and Maintenance of PUA Program

        The Pandemic Unemployment Assistance (PUA) program has provided
    critical support to individuals affected by the pandemic. This funding
    will support the extension and maintenance of the PUA program, ensuring
    that vulnerable members of the community continue to receive essential
    support.
    Public Health Priorities ($55 million)
        Funding for utilities assistance to the Commonwealth Health
    Corporation, the lone hospital in the Marianas. Increasing costs of
    fuel and rising utility rates place a significant cost burden on the
    hospital to maintain current operations as it serves the population of
    the Marianas. Funding will also be used to maximize the Medicaid
    program local match requirements, enabling the Commonwealth to realize
    full allocation of Medicaid funds awarded to the CNMI. Lastly, the
    Group Health and Life Insurance Program provides health insurance to
    over 7,000 covered lives. Funding will ensure the continuation of this
    program into fiscal year 2026.
    Community Enhancement Program ($8 million)
        Universal Garbage Collection: Key to this effort is the reduction
    in littering and the curtailment of the environmental harm caused by
    improper disposal of solid waste by expanding the proper means for
    disposing of waste at the source. Through expanding access to garbage
    collection services and the availability of public waste collection at
    the beaches and parks, community areas are attractive to tourists and
    residents alike.
        Streamline Permitting Process: Government permitting processes are
    disjointed, complex, and time-consuming. This disincentivizes
    investment and business development at the cost of government revenues
    and economic growth. Funding will go toward creating an efficient and
    streamlined system for obtaining government permits, including the
    centralized location and online platform for permit application and
    issuance.
        Enforcement of Blighted Properties: provide incentives for removal
    of structures considered ``public nuisance''.

    EXPENDITURE BREAKDOWN:
    Stimulate Economic Recovery--231.0
    MVA Tourism Recovery Promotional Activities--85.0
         Promotional and Marketing activities to target tourist
                markets

         Development and target investment into Tourism Products in
                Tinian and Rota

         Development of Priority Tourism Centers

    Commonwealth Ports Authority Support
         Promote and Incentivize New Air Service, Maintain current
                flight Routes to the Marianas--26.0

         Commonwealth Ports Authority Operational support--15.0
    Commonwealth Economic Development Authority
         Support Business Retention Initiatives/ Utility assistance
                for Businesses--25.0

         SBDC--Payroll Protection Program--80.0

    Strengthen Public Services--120.0
         Restore revenue loss to autonomous agencies and central
                government

         Restore lost wages from 2020 to current for government
                workers

         Extension and Maintenance of PUA Program

    Community Enhancement Program--8.0
         Enforcement and incentive program for blighted properties

         Streamline and establish unified online permitting portal
                for businesses

         Require Customer Service Training for Customer-facing
                Staff

         Establishment of a System of Universal Garbage Collection

    Address public health priorities--55.0
         Utility assistance to the Commonwealth Health Corporation

         Maximize Medicaid Local Match

         Group Health Life Insurance Program

    TOTAL--414.0
     Prepared Statement of Governor Arnold I. Palacios of the Commonwealth
                        of the Northern Mariana Islands

        Chairman Hurd, Ranking Member Leger Fernandez, I am Governor Arnold
    I. Palacios, and I proudly represent my constituents in Commonwealth of
    the Northern Mariana Islands. I appreciate the opportunity to provide
    written testimony concerning the oversight hearing titled ``Examining
    the Office of Insular Affairs' Role in Fostering Prosperity in the
    Pacific Territories and Addressing External Threats to Peace and
    Security.'' I commend your timely leadership in calling for this
    hearing.
        The Commonwealth of the Northern Mariana Islands is a biproduct of
    negotiations that led to a self-governing relationship in political
    union with United States established through our Covenant. I am
    committed to working with Congress, and with the Trump Administration's
    Office of Insular Affairs (OIA), to realize the commitments to
    achieving a progressively higher standard of living as specified in the
    Covenant of the CNMI with the United States, and to simultaneously
    address threats to peace and security.
        The OIA can help foster prosperity for the CNMI through working to
    conclude Covenant Section 902 negotiations. Despite good intentions and
    progress in 2024, 902 negotiations remain unfinished and long overdue.
    My team is ready to reach a satisfactory conclusion with
    representatives from the Trump Administration, that will allow for
    annual funding arrangements that will stimulate economic development
    and meet pressing needs and recognize inflationary adjustments. I
    remain hopeful that 902 negotiations can resume and soon conclude with
    the necessary results as called for in the Covenant.
        The United States' Department of Defense (DOD) is committed to
    significant investments in the CNMI. Tinian Island will be home to the
    resurrection of three North Field runways, a new Navy port facility,
    and the establishment of a Marine training base. As Governor, I remain
    steadfast in support of the Pacific Deterrence Initiative (PDI) and
    these important national security investments in DOD facilities on
    Tinian. But these investments must be met with balanced investment in
    our communities outside of the DOD installations so the CNMI prospers,
    and we can accommodate very significant increases in personnel and
    resulting demands on our infrastructure.
        Unfortunately, the economy of the CNMI has been drastically
    impacted by the drawdown of tourism from visitors from the People
    Republic of China (PRC). Before the pandemic hit five years ago, some 7
    direct flights from PRC arrived in Saipan every week. Since then, we
    have lost upwards of 70% of our tourism, which has put incredible
    strain on our local economy. The Subcommittee needs to know that there
    are forces in play advocating against DOD-related investments and a
    turnback to PRC based tourism and investments. There are strong outside
    interests that are actively driving anti-US sentiments through funding
    of non-governmental organizations and other means to sow the seeds of
    distrust against the United States government, calling into question
    the commitment to economic development, environmental stewardship, and
    the protection of our local identity. In addition to these anti-us
    forces in play, there are pressures stemming from gang related black
    market activities that include illicit drugs and human trafficking
    operations that pray on the fragile economic circumstances.
        And so, it is vitally important that the Committee on Natural
    Resources support the Trump Administration moving to resume and
    conclude the 902 process as well as working to dedicate covenant fund
    levels to the CNMI, and to end the practice of dividing up the Covenant
    Fund to support other territories. I support all of our island
    territories getting what we deserve, but we must honor commitments and
    no longer ``rob Peter to pay Paul.''
        Currently, my government is operating under financial support that
    is based off levels put into place over three decades ago. It is
    imperative that we resume the Section 902 process as soon as possible
    so that we can reach an agreement and provide financial assistance
    under Section 701 of the Covenant that meets current needs and
    considers inflationary costs of providing basic services and
    investments that will grow our economy.
        As discussed, the Department of Defense (DOD) is making very
    significant investments in the CNMI, and on Tinian Island in
    particular, to meet the demands of the Pacific Deterrence Initiative
    and the Indo-Pacific Command to take on a critical set of defense
    priorities intended to support
        U.S. strategic goals in the region. The Government of the CNMI
    currently lacks the fiscal, workforce, and technical capacities to
    accommodate the influx of significant Pentagon-related investments.
        As I work closely with DOD and the Office of Local Development and
    Community Cooperation, as Governor, I must also deliver what is owed
    the CNMI regarding commitments made under the Covenant. I need your
    support to ensure that the CNMI can progress on each side of the
    military fence as the DOD ramps up investments, and the CNMI once again
    takes on a crucial role in the defense of the U.S. as we face a growing
    threat from the Chinese Communist Party.
        The Covenant has tools that we must utilize; unfortunately, these
    have underutilized over the years. The Covenant calls for a
    progressively higher standard of living, but in reality, per capita
    income has decreased by more than 30% relative to that of the U.S.
    mainland. If we can conclude the 902 negotiations, and identify an
    appropriate level of funding, I can do my part to help address
    shortfalls in socioeconomic development.
        In addition to the 902 process, and relative funding commitments
    that are made under Sections 701 and 702 of the Covenant, I
    respectfully ask the Subcommittee to support a request being put
    forward for the Governmental Accountability Office (GAO) analysis and
    audit of cover-over payments that are authorized under Section 703(b)
    of the Covenant. This important provision has never been effectively
    utilized.
        According to Section 703(b) of the Covenant, proceeds from customs
    duties, and federal income taxes, and from all taxes collected under
    the internal revenue laws of the United States on articles produced in
    the CNMI or transported to the U.S., or consumed in the CNMI, and the
    proceeds of any other taxes or fees levied by Congress on the
    inhabitants of the CNMI (less self-employment and FICA taxes), shall be
    paid into the Treasury of the CNMI to be expended to the benefit of the
    people of the CNMI as our government may prescribe.
        I respectfully ask for your leadership in requesting through a
    letter to the GAO an audit of the cover over program, what has or has
    not been collected and covered over, and what the CNMI may be entitled
    to under the Covenant. Ideally, the Government of the CNMI could
    receive an amount owed under Section 703 (b) that I could leverage and
    create an infrastructure fund that will vastly improve the
    socioeconomic well-being of the CNMI, provide for a much better outside
    the fence environment for my constituents as well as for our service
    members, and reinvigorate our tourism sector that has been decimated by
    the draw down of aviation slots from the PRC. The Covenant and its
    oversight clearly fall under this committee's jurisdiction, and so a
    request for this analysis is relevant and therefore appropriate under
    GAO guidelines.
        Finally, there is an opportunity to reverse the draw down of PRC
    based tourism, but to do so through flights from allied nations in the
    Indo-Pacific region. Congressman Moylan (R-GU) has led this effort,
    which would provide for an end to cabotage restrictions in between Guam
    and the CNMI. This would allow for low-cost carriers to better serve
    our islands from Japan, Taiwan, South Korea and India, and allow our
    tourism-based economy to flourish by welcoming citizens from allied
    countries and to provide our service members more efficient services
    amongst our Guam and the CNMI.
        Thank you for your consideration today and I hope to work with the
    Subcommittee and the full committee's leadership to foster prosperity
    and security in the CNMI and the region.

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