Overview

The Federated States of Micronesia (FSM) — made up of the four states of Yap, Chuuk, Pohnpei and Kosrae — has a population of approximately 113,815 people and shares maritime borders with the Republic of the Marshall Islands, Palau, Guam and Papua New Guinea. The capital, Palikir, is located on the island of Pohnpei.

Political overview

FSM is an independent country in a Compact of Free Association with the United States. FSM has an American-style constitution that came into effect in 1979 and provides for a government composed of an executive branch, a legislative branch and a judicial branch.

The National Congress is unicameral and consists of 14 members. Four senators, each known as "senators-at-large" (one from each state) serve four-year terms. The remaining 10 members represent single member districts based on population, and serve two-year terms. Both the President and the Vice-President are elected by the Congress from among its four-year members and serve a four-year term. The senator-at-large seats vacated by the President and Vice-President are filled by a representative from their state. An appointed cabinet supports the President and Vice President. Each of the four states has its own constitution, an elected governor and a lieutenant governor.

The President of FSM, H.E. Mr Wesley W. Simina, is both Head of State and Head of Government. President Simina took office in May 2023.

Compact of Free Association with the United States

FSM's Compact of Free Association with the United States was first agreed in 1986 and came into effect in 1994. The compact terms are indefinite, while the economic elements have a 20-year term, with reviews throughout the course of the term. In exchange for exclusive military operating rights, the United States provides FSM with economic assistance (including sector grants and trust fund contributions), access to federal services and programs (for instance postal and meteorological services), permission for citizens to enter, work/study and reside in US states and territories and assumes responsibility for FSM's defence and security.

The current Compact agreement between FSM and the United States was signed into law in March 2024 and is valued at USD3.3 billion for FY2024-FY2043.  This phase of Compact assistance includes greater support for the environment, climate change adaptation, health care, education, and infrastructure. 

The US Department of the Interior is responsible for oversight and coordination of funding under the Compact of Free Association.

Bilateral relations

Australia established diplomatic relations with FSM in July 1987 and the Australian Embassy in Pohnpei was opened in November 1989. Australia enjoys a close and friendly relationship with FSM.

The Federated States of Micronesia Embassy in Canberra opened in November 2024.

Development assistance

Australia proudly partners with the Government of FSM to support education, the environment and oceans, and women's social and economic empowerment in FSM. Australia also supports the enhancement of regional connectivity, linking the North and Central Pacific to each other and Australia.

More information on development assistance to the Federated States of Micronesia.

Australia Awards

Australia Awards are an important part of the Australian Government's overseas aid program. Australia Awards Pacific scholarships provide opportunities for students in FSM to study at selected education institutions in the Pacific region.

Volunteers

The Australian Volunteers program promotes economic growth and poverty reduction in the Indo-Pacific region by assisting host organisations to deliver effective and sustainable development outcomes. The Australian Volunteers program provides opportunities for skilled Australians to contribute to the Australian Government's development cooperation program.

Direct Aid Program (DAP)

The Direct Aid Program (DAP) is a small grants program funded from Australia's aid budget. It has the flexibility to work with local communities in developing countries on projects that reduce poverty and achieve sustainable development consistent with Australia's national interest.

Visit the Australian Embassy in FSM website for further information on the DAP.

Economic overview

FSM's economy is dominated by government services and external grants, with relatively limited private sector activity. FSM's small, remote and dispersed population, narrow range of natural resources, and vulnerability to external shocks present challenges to growth. The fisheries sector is regarded as having the greatest development potential. With an EEZ of 2.7 million square kilometres, FSM has access to major equatorial tuna migratory paths and the fishing industry has been boosted by the introduction of the Vessel Day Scheme under the Parties to the Nauru Agreement. Fishery licensing fees account for nearly half of domestic budget revenue.

The tourism industry is another area of potential for FSM, particularly diving and eco‑tourism. Some 21,000 tourists visit the islands each year. Tourism development is, however, constrained by limited airline links, limited infrastructure, including roads, power and water, and by the country's geographical isolation. 

Trade and investment

Australia’s goods and services trade with FSM in 2023 totalled $15 million. This was largely comprised of prepared and preserved meat, education-related travel and other services.

High level visits

• August 2024: Prime Minister Albanese met with H.E. Wesley W. Simina, President of the Federated States of Micronesia, in the margins of the 53rd Pacific Islands Forum Leaders Meeting in Tonga.
• January 2024: Assistant Minister to the Prime Minister Patrick Gorman met FSM President Wesley W. Simina on 22 January at the inauguration of the RMI President in Majuro.
• August 2023: FSM Vice President Aren Palik visited Australia in 2023 to take ownership of FSM's second Guardian-class Patrol Boat, FSS Bethwel Henry. During his visit, he met with Deputy Prime Minister Richard Marles and Foreign Minister Penny Wong.
• December 2022: A bipartisan delegation led by Foreign Minister Wong visited Pohnpei in 2022. The delegation met President Simina (then Speaker) and Vice President Aren Palik as well as then President David Panuelo and - then Secretary of Foreign Affairs Kandhi Elieisar. They celebrated 35 years of diplomatic relations and visited Australian-funded education programs.