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languages: Palauan, English
President: Johnson Toribiong
Republic of Palau
religions: Christianity, Modekngei
Palau does not produce enough
food to support itself, mainly because the cost
of doing so is higher than the cost of importing
needed items. The main crops are coconuts,
bananas, root crops such as taro (similar to the
potato), vegetables, and tropical fruits.
Poultry, pigs, and dairy cows are the main
livestock. Crops and livestock generated only
about 2 percent of GDP in 1998. Since Palau
cannot incorporate any economies of scale in
agricultural production, the likelihood of
significant increases in the sector are slim.
Fisheries generated about 3 percent of GDP in
1998, but output from the fisheries sector
appears to be in a steady decline-in 1992, the
value of fish landed was almost 4 times greater,
and the fishing fleet has halved to 150 vessels
Much of the catch from Palau's waters is taken
by Chinese and Japanese vessels, and Palau
receives income from licence fees of around
$200,000 a year. It is felt that there is
considerable illegal fishing. In addition, local
boats meet with Chinese and Japanese vessels at
sea and sell their catches to them, leading to
under-recording of the Palau catch.
More than 200 volcanic and coral islands, many of them surrounded by a single barrier reef, make up the northern Pacific nation of Palau.
Its tropical waters are home to an abundance of marine life, making Palau a paradise for divers.
The scenery ranges from white sandy beaches to dense jungle. Palau tries to protect its wildlife from hunters and poachers. It favours sustainable tourism.
It relies on financial aid from the US, provided under a Compact of Free Association which gives the US responsibility for Palau's defence and the right to maintain military bases there. Direct aid is set to wind up in 2009.
Tourism is low key, though growing in economic importance. Many visitors come from Taiwan, with which Palau has diplomatic ties. Taiwanese aid boosts the economy. The government is Palau's largest employer.
Monoliths and other relics are reminders of an ancient culture that thrived on the islands, but Palau's recent history has been dominated by outside influences - from Spain, Britain, Germany, Japan and the US. Palau saw some of the region's fiercest fighting in World War II.
Though embracing some Western trappings, many Palauans identify with their traditional culture and its codes and rites.
Politics in Palau sometimes has been lively; the nation's first president was assassinated in 1985.
Mr Toribiong was elected in the presidential poll of November 2008, beating outgoing Vice-President Elias Camsek Chin. The previous president, Tommy Remengesau, had served his maximum two consecutive terms and could not run again.
A US-educated lawyer, Mr Toribiong served as ambassador to Taiwan before standing for president.
Like his predecessor, President Toribiong has said Palau must end its dependence on US aid and diversify its economy beyond tourism. He was inaugurated on 15 January 2009.