U.S. signs agreement to continue Micronesia assistance under strategic pact

FILE PHOTO: FILE PHOTO: The State Department Building is pictured in Washington

WASHINGTON (Reuters) - The United States said it signed agreements with Micronesia on Tuesday concluding negotiations to extend economic assistance to the island state under a strategic pact key to U.S. efforts to push back against China in the Pacific.

The State Department said additional negotiations were underway with Micronesia (FSM) to continue federal programs and services currently provided under a Federal Programs and Services Agreement.

Three agreements related to Micronesia's Compact of Free Association (COFA) with the United States were signed by the charge d'affaires of the U.S. Embassy in Pohnpei and Micronesian negotiator Leo Falcam Jr.

This marked "the successful conclusion of negotiations with FSM regarding the extension of Compact- related economic assistance" and was "a major milestone" in relations, the State Department said in a statement.

Washington first reached COFA accords with three Pacific island states - FSM, Palau and the Marshall Islands - in the 1980s under which it retains responsibility for their defense and provides economic assistance while gaining exclusive access to huge strategic swathes of the Pacific in return.

Under memorandums of understanding reached on renewing the pacts, the U.S. will commit a total of $7.1 billion over 20 years to the three nations, subject to U.S. Congressional approval.

The U.S. statement called the relationship with FSM "special and historic" and said continuation of COFA-related assistance at "significant" levels reflected this and would support development and help tackle challenges such as climate change.

Renewing the COFAs has become a key part of U.S. efforts to push back against China's bid to expand its influence in the Pacific. Chinese diplomats have been courting the region and China's construction and mining companies have expanded their business in many Pacific island nations.

On Monday the U.S. signed a renewed COFA with Palau and chief COFA negotiator Joseph Yun told Reuters on Saturday he hoped to finalize a deal with the Marshall Islands in the coming weeks.

The Marshall Islands' COFA is due to expire this year.

(Reporting by David Brunnstrom; Editing by Don Durfee and Stephen Coates)