Koror- Australian Foreign Minister Julie Bishop will arrive in Palau on Sunday for the first leg of her North Pacific visit, according to the Australian Embassy in Pohnpei.
From Palau, Bishop and International Development Minister Concetta Fierravanti-Wells, opposition foreign affairs spokeswoman Penny Wong and Labor Senator Claire Moore will travel to Federated States of Micronesia (FSM) and Republic of the Marshall Islands from June 3 to 7.
This is the first visit of Bishop in Palau. The group is expected to call support for Pacer Plus free trade deal which covers Australia, New Zealand, and eight island countries.
Palau, FSM, and RMI have not signed the trade deal because of certain terms set by the Compacts of Free Association with the United States.
Based on the Most Favored Nation Clause in the Compacts, freely associated states are mandated to provide to the U.S. the same concessions they may give Australia and New Zealand under Pacer Plus.
One of the salient aspects of PACER Plus is the elimination of import tariffs. This will mean significant revenue loss for Palau, as the United States is its major trading partner.
Since import tariffs provide huge revenue for the government, Palau is not likely to sign the treaty.
According to World Integrated Solution, Palau's import industry generated $154 million in 2016.
The agreement, better known as PACER Plus, proposes tariff cuts among signatory nations and is rhetorically touted to help small Pacific Island through increased import-export trade and investments.
Bishop and her delegation on their North Pacific tour will hold talks with Palau President Tommy Remengesau, FSM President Peter Christian and RMI President Dr. Hilde Heine.
In Palau, the bipartisan group will also hold discussions with Palau officials and lawmakers. The group will also visit the Belau National Museum and the Palau International Coral Reef Aquarium.
In Pohnpei, the group is scheduled to visit Nan Madol, a World Heritage site. The group will meet the Australian volunteers, staff of the Australian Embassy in Pohnpei and inspect Australian patrol boats.
In Ebeye, the group will hold discussions with Minister-in-Assistance Hon David Paul and inspect the Ebeye Water Sewer and Sanitation Project In Kwajalein, the group will be briefed on the functions of US Army Garrison.
The last stop is Majuro when they will also hold discussions with Foreign Minister John Silk and visit ‘Women United Together Marshall Islands’ (WUTMI).
While the North Pacific tour is Bishop’s first visit, this is the second visit of International Development Minister Fierravanti-Wells in Palau. She represented Australia in the recent Forum Economic Ministers Meeting in April.
In January Minister Fierravanti-Wells accused China of financing "useless buildings" and "roads to nowhere" in the Pacific.
The Pacific gets the lion’s share of Australia’s overseas aid budget, which is seen as an attempt to counter China’s growing influence in the region.
Mainland China and Taiwan are seeking closer ties in Palau. Although Palau is steadfast in retaining its policy of ties with Taiwan, visitors from China dominate its tourism market.
Chinese tourists have captured over 50 percent of visitors’ arrivals in Palau since 2015. Several Chinese businessmen have also invested in Palau from hotels, restaurants and tour companies.