Tag Archive for: Palau

Pro-Palau v Pro-Palau: the Pacific state’s election was essentially domestic

Actually, there were two presidential elections with geostrategic implications on 5 November. While the US elected Donald Trump again, the Western Pacific island state of Palau handed a second successive term to President Surangel Whipps Jr. 

The geostrategically interested will mostly notice that Whipps was the most pro-US candidate. The other candidate, former president Tommy E Remengesau, was also pro-US, just less so. So, actually, not a lot was immediately at stake geostrategically. 

Palau, independent but closely associated with the United States, is 1700km from the South China Sea. US military presence there is therefore growing, and China is trying hard to gain influence over the country. A tilt away from the United States that Beijing might eventually engineer would have strong security implications. 

But the concerns of outsiders were not the concerns of Palauans as they voted. For them, the choice of president was based on local issues—as shown by what the candidates campaigned on. And both candidates are better understood as having been, first and foremost, pro-Palau. 

With nearly all locally cast votes counted, Whipps leads Remengesau, who is also his brother-in-law, with 58.1 percent of the vote. Absentee ballots won’ t be counted until 12 November, but Whipps cannot now lose. In a statement on broadcaster Palau Wave Productions, Remengesau congratulated him on victory. 

As with most elections anywhere, the outcome in Palau was driven by issues affecting Palau, such as taxation, inflation, environmental conservation, crime and drug use. Another was emigration, since locals worry that too many of them are leaving their country of 18,000 people. 

Palauans were aware of their country’s international importance and of foreign views of the election. Chinese influence is not hidden, but it was not a campaign issue.  

Over the years, Whipps has often discussed the pressure China has put on Palau to cease recognising Taiwan. (Palau is one of only 12 countries that do so.) But he did not make the issue part of his campaign.

In conversations with Palauans during the campaign, I usually heard them say that the biggest issue was the high cost of living. Remengesau told voters it was caused by the 10 percent goods and services tax that Whipps introduced last year.  

Whipps pointed to international oil-price rises that followed Russia’s attack on Ukraine. He tried to explain the structure and effects of the tax. 

Whipps has proposed increasing the minimum wage to stem emigration. He wants to reduce the national marine sanctuary from 80 percent of its exclusive economic zone to 50 percent. That would address high fish costs, he says. 

Transnational crime and drug trafficking have been an especially prominent domestic issue, following two drug-related deaths in the past year, one of them a murder. 

Many of these issues have a foreign component: rising prices from Russia, foreign fishing in Palau’s waters, transnational drug trafficking, and emigration to affluent countries. However, that is not how Palauans look at these issues. They see prices they can’t afford, decreasing fish stocks, people leaving their homes and family members addicted to drugs.  

This domestic perspective is evident in Whipps’s longtime campaign slogan: ‘a kot a rechad er Belau,’ meaning ‘Palauans First.’  

This contrasts with most international media coverage of the election, which focused on its possible international consequences, such as the US losing one of its footholds in the Western Pacific. 

Still, the US and China do come up as political issues in Palau. Whipps is sometimes asked about increasing US military presence. His frequent response has been, ‘Presence is deterrence’—meaning that US forces being in Palau does not increase the likelihood of an attack by China but, rather, decreases it. 

In Palau, China is associated with domestic problems. Increasing tourism from China may again threaten Palau’s pristine environment. Malign actors from China have been intermingled with tourists, worsening Palau’s drug crisis and engaging in other criminal pursuits. Chinese investors have bought 50- or 99-year leases on much of Palau’s prime real estate, locking out commercial development. 

‘Presence is deterrence’ is equally relevant domestically. The US is helping with fighting crime and influence operations emanating from China. It has increased its diplomatic, national security, cybersecurity and law enforcement presence in Palau, with some success against those domestic threats. 

That’s very good for the US’s standing among Palauans. In the future, as in their presidential election, they’ll be thinking of Palau. 

Hardly an inducement: tourism from China gets up Palau’s nose

China might want to think again about its use of tourism as a means of influencing Palau. The people of the little Western Pacific country believe they’d be better off without swarms of tourists from China on their islands, causing environmental damage and spending their money mostly with Chinese businesses.

Other ill-effects include upward pressure on prices and the locking up of land in China-linked real estate investments, Palauan officials and people involved in tourism said in interviews.

In a leaked letter this year, the president of the country of 18,000 people, Surangel Whipps Jr, told an unidentified US senator that China had offered to ‘fill every hotel room’ and build as many more as Palau wanted.

To Palauans, that sounds more like a threat than a promise. A senior official sums up the general assessment of tourism from China: ‘The negative impacts [are] more than the value of the tourism itself.’

China has already put Palau through a cycle of what it thought was economic inducement and punishment. Last decade, it ramped up tourism numbers to the country but then knocked them down again by revoking Palau’s status as an approved destination, punishing it for continued diplomatic recognition of Taiwan. Arrivals from China peaked at 90,000 in 2015 and slumped to 28,000 in 2019, before the Covid-19 pandemic crushed tourism globally.

Now tourism from China is rising again: 8000 visitors from the country arrived in the five months to May.

There is a sense in Palau that it is just the beginning of resurgence. Businesses and investors connected with China have begun refurbishing Chinese restaurants and hotels in anticipation of a new surge in visitors. In what looked like a deliberate reminder of China’s economic importance ahead of Palauan general elections on 5 November, direct flights from Hong Kong resumed just five weeks ago.

When Americans, Australians and people from most other countries travel to Palau, they stay in Palauan-owned hotels, eat at Palauan restaurants, hire Palauan tour guides and contribute to the Palauan economy.

When tourists from China come, ‘they have these charter flights coming in, where a Chinese company owns a hotel in Palau, owns a tour company in Palau, owns the airplane that’s bringing them into Palau, so all this money that is being made from these tours is not trickling down to the local economy,’ says a former Palauan tour guide who, like other people interviewed for this report, asked not to be named.

One of the interviewees adds, ‘Chinese tour companies bought out entire hotels,’ leading managers to cancel reservations for other tourists. That ‘destroyed the market overnight’ for tourism from elsewhere.

This person also says that when tourists began arriving last decade, Chinese companies began acquiring long leases on prime real estate. (Foreigners can’t buy land outright.)

The senior Palauan official says, ‘One of their methods is they’ll lease property for 99 years and they don’t do anything to it, so they’re basically stalling development for Palau. That’s one of their tactics’ to gain economic and political influence. The result is diminished opportunity for locals to build businesses on suitable land.

Palauans have seen tourism drive inflation and expect that a renewed surge in arrivals from China will do the same again. ‘This kind of mass tourism will tend to push up the price of mass produce and local resources…,’ says the senior official. The price of giant coconut crabs, for example, was US$7 per pound before last decade’s tourism surge, the official says. Now it is US$60 per pound.

While tourists from any country will always include some who care little for protecting the natural environment, Palauans have found that the problem is unusually serious with groups from China.

The former tour guide recalls damage that tourists from China caused to one beautiful attraction, Jellyfish Lake. Some stole protected jellyfish from the lake to eat in their hotel rooms, using drawers as cutting boards. Hotels were forced to replace furniture and remove utensils that could be used for cooking.

Palauans often hear of tourists from China stealing animals from native habitats and bribing guides to look the other way. One interviewee describes instances of people from China taking giant clams for consumption directly from a reef. Another says tourists paid fishermen to bring them turtles, clams, shark fins and even dugongs, all of which are protected.

Then there’s infrastructure and business disruption. During the initial surge ‘they [came] in such big numbers, it overwhelms our sewer systems,’ the former tour guide said. ‘It overwhelms our stores. It overwhelms our tour services.’

Palau’s government has been trying hard to diversify tourism sources. Two weeks ago, Palau signed a deal with Japan for direct flights from Tokyo in 2025. Three days later, Australian airline Qantas agreed to take over direct flights from Brisbane from Air Nauru, aiming to increase frequency.

Palau’s people will welcome that.

Beijing has presumably imagined they would instead welcome another wave of tourism from China. But the behaviour of many of its tourists, the disruption caused by their arrival surges, and the cornering of their spending by operators and hotels connected to China—all these have only helped to galvanise Palauans against Beijing.

China is likely to step up influence operations in Palau

As Palau approaches its November presidential election, expect China to intensify its influence operations in the strategically crucial Pacific island state. Much is at stake: the election may determine Palau’s future relationship with Taiwan and its stance towards the People’s Republic of China.

The prospect of intensified Chinese influence operations increases the risk of a candidate preferred by Beijing becoming president in a country that’s just 2,400 kilometres from the South China Sea, is a key ally of the United States and supports it by hosting a major air base, a naval base and a newly installed radar with extremely long range.

Palau has already been the target of Chinese information operations, and there are several indicators that those efforts are now being directed at the election. China is likely to implement refined tactics that it previously used in the recent Philippine and Taiwan presidential elections. Urgent action to guard against interference is crucial to protect Palau’s democratic process and sovereignty as a whole.

The two major candidates confirmed to be in the race are current president Surangel Whipps Jr, who is pro-US but less popular with the public overall, and former president Thomas Remengesau Jr, who has several ties to China and is favoured to win.

A recent report by the US State Department’s Global Engagement Center outlines Beijing’s five main tactics to manipulate the information space. One tactic—propaganda and censorship—is of primary relevance in Palau.

Propaganda and censorship have been used by China to directly manipulate its messaging worldwide. For example, China has made several attempts to gain a foothold in Palau’s domestic media ecosystem.

As detailed in an OCCRP article, ‘Failed Palau media deal reveals inner workings of China’s Pacific influence effort’, a local news outlet has been linked to CCP-associated individuals and narratives several times in the past. The outlet, Tia Belau, is one of two widely circulated domestic newspapers in Palau. Its owner, founder and recently declared presidential candidate, Moses Uludong, is a prominent figure in Palauan media and has been documented on multiple occasions advocating for closer relations with China.

In 2018, Uludong joined the Palau Media Group—a venture led by Tian ‘Hunter’ Hang, a key player in China’s strategy to exert soft-power influence in Palau. While the Palau Media Group did not succeed upon launch, Tia Belau has since been used to publish pro-China content and is known as a China-sympathetic media source. Beijing’s blatant investment in local media outlets, such as Tia Belau, minimises the potential exposure of unfavourable stories and pushes very specific dialogues that support Chinese interests.

China uses a variety of censorship tactics that could disproportionately affect a small, relatively isolated population such as Palau. They include information disturbance (flooding the information space with false narratives to create doubt and uncertainty), discourse competition (shaping cognition by manipulating emotions and implanting biases), public opinion blackout (using bots to flood social-media spaces with a specific narrative to suppress opposing views), and blocking of information (technical blockades and physical destruction of narratives unfavourable to China) to censor the information space, several of which have been increasingly seen in Palau leading up to the election.

Tracking and identifying specific instances of China-influenced messaging is challenging, as it is with all forms of misinformation. Nonetheless, it’s clear that China has significantly increased its focus on Palau in the months before the election, leveraging economic pressures to promote China-favoured narratives. Combined with the evidence collected from Chinese involvement in other recent elections, there’s little doubt that China is using social media and news outlets to reshape ‘China’s story’ within Palau, aiming to influence the political outcome of the election.

Given Palau’s small population, geographic location and susceptibility to corruption, combating Chinese election interference will be challenging. Tactics similar to those implemented in Taiwan, such as amplifying local conflicts, using local proxies, media outlets and social-media accounts, exploiting domestic actors with ideologically aligned views, and relying on artificial intelligence to promote desired CCP messages and outcomes, should be expected. Direct media interference and disinformation campaigns, as seen in the Philippines, are also highly probable.

Countermeasures inspired by those implemented in Taiwan could help Palau build resistance to China’s propaganda. Targeted training for Palauan journalists and media professionals on countering disinformation could help bolster resilience and incentivise responsible journalism. Palau’s government could prioritise debunking disinformation with counternarratives, prosecuting individuals involved in large-scale disinformation campaigns, or implementing legislation similar to Australia’s News Media Bargaining Code or Taiwan’s Anti-Infiltration Act. Finally, Palau could encourage civil-society initiatives that track and counter disinformation, as well as media literacy programs in schools that teach students how to resist false narratives.

China’s information operations in Palau highlight the need for the nation to adopt effective countermeasures as it approaches its presidential election this autumn. By learning from the experience of Taiwan and the Philippines, Palau can enhance its resilience and protect its information environment.