Koror—President Surangel Whipps Jr.’s reelection to a second consecutive term represents both a significant personal victory and a potential political crossroads. His decisive win over former President Tommy E. Remengesau Jr., with 57 percent of the vote—one of the widest margins in Palau’s presidential election history—cements his political standing.
However, losing key allies in the Olbiil Era Kelulau (Palau National Congress) foreshadows a more confrontational legislative term beginning January 2025, potentially complicating his ambitious agenda for the next four years.
Whipps’ reelection was underpinned by his deft management of Palau’s economic challenges, especially the increased cost of living. Despite the initial backlash against the introduction of the Palau Goods and Services Tax in 2023, Palau’s version of the value-added tax, Whipps successfully turned public sentiment by emphasizing its long-term benefits. The tax reform aimed to close loopholes, boost government revenue and stabilize essential services. Its positive effects became evident as inflation eased significantly just before the election.
Key policies that bolstered Whipps' appeal included raising government salaries by $3,120 over two years, increasing the minimum wage and offering direct financial support to families and retirees. The goods and services tax also introduced full income tax refunds for individuals earning up to $15,000, benefiting 70 percent of the workforce.
Adding to his momentum, just weeks before the election, the United States pledged $20 million to strengthen Palau’s pension fund and committed to supporting the construction of a new national hospital.
These measures, combined with stabilization in inflation, helped Whipps present himself as a leader capable of navigating economic turbulence while delivering tangible benefits to the populace.
Whipps’ first term saw robust support from Speaker Sabino Anastacio, who effectively rallied the House of Delegates - the other half of the Palau National Congress - to back key initiatives like tax reform.
However, Anastacio’s heavy-handed leadership style alienated voters, leading to his electoral defeat and losses for several key allies. The incoming Congress is expected to be more fragmented and independent, with a Senate that may prove less receptive to the president’s agenda.
Whipps plans to expand blockchain-based programs, including the digital residency program, Palau Stablecoin, and a new initiative involving blockchain-backed savings bonds, some of which will require the Olbiil Era Kelulau’s approval.
He is also advocating for marine spatial planning to increase commercial fishing opportunities, aiming to offset financial losses reportedly linked to the Palau National Marine Sanctuary.
Additionally, Whipps is pushing for a controversial loan from Saudi Arabia, which includes provisions for diplomatic immunity for Saudi Development Fund employees, confidentiality of loan documents, and exemption from Palau’s Open Government Act.
However, advancing these initiatives will require legislative support, which is an increasingly challenging task given the evolving dynamics in the Olbiil Era Kelulau.
Whipps’ pro-American stance, exemplified by his welcoming attitude toward U.S. military presence, aligns with his broader foreign policy of reinforcing alliances with the U.S., Japan, Taiwan and Australia. However, this approach faces domestic pushback: a lawsuit challenges a proposed Peleliu State referendum to amend its constitution to allow military activities on the island. Moreover, several high school students have submitted documentation to the UN alleging human rights violations linked to U.S. militarization in Palau.
These tensions underline the need for careful navigation of Palau’s growing strategic role in U.S. defense policy, especially as plans for increased militarization, including potential missile installations, take shape.
In the past, discussions about the U.S. military presence in Palau were largely confined to the national level in the context of the Compact of Free Association. However, with military activities now being directly felt at the community level, this represents uncharted territory that has yet to be fully tested.
Despite potential headwinds, Whipps remains committed to transforming Palau’s economy and solidifying its role as a key U.S. ally. His "presence is deterrence" policy underscores his belief in the strategic value of welcoming U.S. military activities, while his domestic policies aim to address economic vulnerabilities through innovation and reform.
How he manages a more independent and potentially adversarial Congress, balances domestic concerns about militarization and advances his ambitious economic plans will define his legacy.
For now, Whipps’ reelection marks both a personal triumph and the start of a more challenging political chapter.
The recently concluded election also marks a groundbreaking moment in Palauan politics, particularly at the national leadership level. For the first time, a record number of women have been elected to the Olbiil Era Kelulau.
Six out of 31 seats will now be held by women, with four elected to the House of Delegates and two to the Senate. Among this group, five are first-time lawmakers, making this a monumental step forward in Palau’s political landscape.
While this development represents a significant milestone, it remains to be seen what issues will define this new Congress as these women take their seats and begin shaping their legislative agendas.
Full disclosure: One of the newly elected women is the author’s spouse. Kambes Kesolei is a journalist based in Koror. He is one of the founders of Pacific Note and writes for Tia Belau. Send feedback to okkesolei@gmail.com
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