Federated States of Micronesia

Political Status

The Federated States of Micronesia (FSM) emerged from the Trust Territory of the Pacific Islands (TTPI) which the United States administered on behalf of the United Nations from 1947 until 1978.  The FSM adopted its own constitution and became an independent country in 1979; it entered into a Compact of Free Association with the United States in 1986 and became a member of the United Nations in 1991. The first financial package of the Compact covered 15 years, from 1986 to 2001. Under provisions of the Compact, the Compact was extended for two years while the United States and the FSM completed negotiations for a new financial package in 2003, covering 2003-2023. A Trust Fund was also created to contribute to the long-term budgetary self-reliance of the FSM when the financial grant provisions of the Compact expire in 2023. Under the Compact, the United States provides financial assistance, defends the FSM's territorial integrity, and provides uninhibited travel for FSM citizens to the U.S.  In return, the FSM provides the United States with unlimited and exclusive access to its land and waterways for strategic purposes.  The close ties between the United States and the FSM that go back to the end of World War II are also reflected in the fact that hundreds of FSM citizens serve in all branches of the U.S. Armed Forces and further their education in the United States. The FSM also uses the U.S. dollar as its currency.


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