United States Government Publishing Office publisher pbl distributor dst United States Government Accountability Office author aut Government Organization text government publication eng GAOREPORTS Legislative Agency Publications gao legislative 2010-08-12 U.S. Government Printing Office 2008-06-10 monographic deposited born digital 26 p. GA 1.13:GAO-08-859T https://www.govinfo.gov/app/details/GAOREPORTS-GAO-08-859T P0b002ee180385a81 f:d08859t DGPO 2010-08-12 2011-03-23 GAOREPORTS-GAO-08-859T machine generated eng fdlp REPORT GAOREPORTS-GAO-08-859T GAO-08-859T Cost analysis Economic analysis Economic development Economic growth Economic policies Federal aid programs Federal aid to foreign countries Financial disclosure Financial management Foreign aid programs Foreign economic assistance Foreign financial assistance Foreign governments Foreign policies International agreements International economic relations International relations Trust funds Funds management Budget activities Cost awareness Cost estimates Compact of Free Association with Micronesia Testimony A82312 From 1987 through 2003, the Federated States of Micronesia (FSM) received more than $1.5 billion in economic assistance under the original Compact of Free Association with the United States. In 2003, the U.S. government approved an amended compact with the FSM that provides an additional $2.3 billion from 2004 through 2023. The Department of the Interior's Office of Insular Affairs (OIA) is responsible for administering and monitoring this assistance. The amended compact identifies the additional 20 years of grant assistance as intended to assist the FSM in its efforts to promote the economic advancement and budgetary self-reliance of its people. The assistance is provided in the form of annually decreasing grants that prioritize health and education, paired with annually increasing contributions to a trust fund intended as a source of revenue for the country after the grants end in 2023. The amended compact also contains several new funding and accountability provisions intended to strengthen reporting and bilateral interaction. Among these provisions is a requirement for the establishment of a joint economic management committee and a trust fund committee to, respectively, among other duties, review the FSM's progress toward compact objectives and assess the trust fund's effectiveness in contributing to the country's economic advancement and long-term budgetary self-reliance. In 2003, we testified that these provisions could improve accountability over the assistance provided but that successful implementation of these provisions would require appropriate resources and sustained commitment from both the United States and the FSM. Drawing on several more recent reports as well as updated information, this report will discuss the FSM's economic prospects, implementation of the amended compact to meet its long-term goals, and potential trust fund earnings. https://www.govinfo.gov/content/pkg/GAOREPORTS-GAO-08-859T/html/GAOREPORTS-GAO-08-859T.htm https://www.govinfo.gov/content/pkg/GAOREPORTS-GAO-08-859T/pdf/GAOREPORTS-GAO-08-859T.pdf GAO-08-859T https://www.govinfo.gov/app/details/GAOREPORTS-GAO-08-859T Testimony GAO-08-859T; Compact of Free Association: Micronesia Faces Challenges to Achieving Compact Goals; Cost analysis Economic analysis Economic development Economic growth Economic policies Federal aid programs Federal aid to foreign countries Financial disclosure Financial management Foreign aid programs Foreign economic assistance Foreign financial assistance Foreign governments Foreign policies International agreements International economic relations International relations Trust funds Funds management Budget activities Cost awareness Cost estimates Compact of Free Association with Micronesia Public Law 99-239 Public Law 108-188