Three Pacific Nations Are 'Freely Associated' With the United States

Three sovereign Pacific nations — the Federated States of Micronesia, the Republic of the Marshall Islands, and the Republic of Palau — sit in the United Nations under their own flags but use the United States dollar as legal tender, send their soldiers to enlist in the U.S. military, and let any citizen move to Hawaii or Arkansas to work without applying for a visa. The arrangement is called the Compact of Free Association, and it does not have a clean parallel anywhere else.

The history runs through World War II. After the U.S. captured the Japanese-mandated islands of Micronesia in 1944, the United Nations created the Trust Territory of the Pacific Islands in 1947 and handed administration to the United States — first under the Navy, then the Department of the Interior. In 1978, the islands were offered a menu of futures: U.S. territorial status, commonwealth status (which Saipan and the rest of the Northern Marianas chose), full independence, or a new category — "free association." The Marshallese, Micronesians, and Palauans picked the last.

The deals took years to finalize. The FSM and RMI compacts were signed in 1982, ratified by their citizens in plebiscites, approved by U.S. Congress in 1985, and entered force in 1986. Palau's was signed in 1986 but not ratified domestically until 1993; it took effect in 1994. In exchange for the migration and dollarization rights, the United States got exclusive defense access — including the right to demand land for bases, subject to negotiation — and the power to exclude any other country's military from compact waters.

The original financial provisions ran out in 2023. After a year of stopgap funding, Congress folded a renewed twenty-year package into the Consolidated Appropriations Act, which President Biden signed on 8 March 2024. The compacts are now scheduled to run through 2043.