FSM President Panuelo offers FSM as a transshipment hub for China's goods

Quid pro quo? Officials say president's offer has nothing to do with $16M grant from China

image FSM Foreign Affairs Kandhi A. Elieisar receives Chinese Ambassador Huang Zheng during a May 26, 2021 handover ceremony for China’s $16-million grant. Photo courtesy of FSM Information Service

Reaffirming its "great friendship" with Beijing, the Federated States of Micronesia has offered to be a regional transshipment hub for China's commerce, which would entail wider accessibility of the nation's waters.

FSM President David Panuelo said his country is strategically located to accommodate the air and maritime logistics as a transit hub for goods in transit between China and the South Pacific, and China and South America.

"Recalling my statement at our bilateral engagement in Beijing, I again reaffirm our offer for the Federated States of Micronesia to become an economic and commercial hub for the 21st Century Maritime Silk Road," Panuelo said in his congratulatory message to "our very dear Chinese friends" on the centennial anniversary of the Communist Party of China.

Panuelo renewed the offer two days after the FSM received China's $16 million development grant which officials said was part of the economic and technical cooperation agreements sealed between FSM and Beijing in December 2019.

The FSM government, however, quickly sought to dispel public suspicions of a quid pro quo.

"Contrary to pernicious rumors across the FSM, the economic and technical assistance from China comes with no political conditions or strings attached," the Office of the President stated in a press release.

"This recent assistance, like historical assistance to the FSM through the FSM-China Great Friendship, is through the form of a grant— not a loan—and is based on China’s aid principles of equality, mutual benefits, openness, and sustainability," the government press release said.

In his congratulatory message to Chinese President Xi Jinping, Panuelo reaffirmed his nation’s commitment to China's Belt & Road Initiative and offered his support "to help ensure that the 21st Century Maritime Silk Road adds value and increases the prosperity of citizens across the Blue Pacific Continent."

The Maritime Silk Road is the sea route part of the Belt and Road Initiative, which is China's strategic program to expand its influence in the region, a campaign that the United States seeks to stamp out.

The U.S. military's Indo-Pacific strategy involves operational buildup in the Pacific region to thwart China's People's Liberation Army. At the same time, the U.S. Coast Guard has beefed up its patrol against illegal fishing in the Pacific region.

While further sealing FSM's alliance with China, Panuelo at the same time affirmed its "enduring partnership" with the United States. "We hope to see more cooperation, and less competition, between two of our closest allies," the president said.
But Panuelo won't hide his love for China.

"From your successful containment of the Covid-19 pandemic to the eradication of extreme poverty, the Chinese people are blessed to see real development and real change within their own lifetimes. That is a testament to the Communist Party of China’s intentions to work together toward a prosperous community with a shared future for humankind," the president said.

Panuelo applauded "the hard work and vision of H.E. Xi Jinping, T.H. Li Keqiang, and the people of China, for their accomplishments and their continued commitment to global prosperity."

The president said China's generous aid -- "and in the form of grants, not loans. to FSM"-- was a testament to a "great friendship" between the two nations.

"From major infrastructure projects that benefit the average citizens’ life on a daily basis to technical capacity-building efforts to improve our ability to sustain ourselves, our nation is stronger and more resilient because of our friendship with China and its people," Panuelo said.

In an apparent attempt to mitigate diplomatic tension, Panuelo said both China and the U.S. are important to the region's efforts to address climate change.

"Of particular importance to the Federated States of Micronesia and our people is the recent establishment of a Climate Change Working Group between our great friends in the People’s Republic of China and our enduring partners in the United States of America," Panuelo said.

"As an existential threat that affects every country on the planet, it is our view that it is both essential and vitally important that our great friends and enduring partners cooperate together," he added.



  • wow ! it seems the US is little by little losing its grip on this region all because of the inactive of the US in the region caused by the divisive between the two governing Parties that was created by Trump and Putin.. interesting!
  • FSM has been bought and screwed. I wonder who drafted the President's speech. I suspect China's involvement or somebody been bought by China. The US needs to be more aggressive in preventing China to use FSM as a transshipment point. It will start as a commercial use but eventually will be used for military purposes which is in violation of the Compact. Come on US, be more aggressive before it is too late. We all know the intention of China. Don't be fool by them. They are very dangerous. They don't even want to reveal the origin of the Covid virus. I totally agreed to the Scientists that the virus started in the lab used by China for military purposes. US please send in the military to take over the national government. A lot of our boys sacrificed their lives for democracy and we do not want their sacrifices to go in vain.
  • Just look at the picture, the Secretary of Foreign Affairs shaking the hands of the Chinese Ambassador smiling. This is very farting. The $16 million is nothing comparing to the million of dollars and assistance the FSM received from the US. We need to go and find out the contents of the Secretary's home, probably including sofas and TV sets.
  • We should learn a lesson from what is happening in the South China sea and Hong Kong. China is getting and building islands in the South China Sea by force despite the ruling issued by the International Court. They don't give a shit. They were successful in putting down the democratic movement in Hong Kong by jailing and killing the protesters. Now, they want to take over Taiwan and the group of islands owned by Japan and continued to expand their influences in the South Pacific. Gradually, they are moving North, now already taken over Kiribati and the FSM is the next. I admire the new President of Palau for standing up to China, he is the only who got balls comparing to our sissy and cowardly FSM President. We need to get rid of him.
  • Sorry, I am just piss by the recent action by the FSM President. It is time that we start looking into his personal life because it can influence his actions in the office. Where is his real wife from Kitti? The President is committing sin by taking another woman as his wife when the real wife is still alive. Why aren't we talking about this? Where are the priests and wanporons? How come they are not talking? Are we afraid of the Panwelo's family? We are a punch of cowards.
  • We are doomedimageimage
  • The thing is, China and the USA are fighting over this pacific region, and when president Panuelo made the press, I wonder what was his message to both countries?. one being a friend and the other being a enduring partner?.. any expert FSM politic here can explain will be a great service to us all forumers.
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