Government of the Federated States of Micronesia

President Mori expressed "serious concern" over JEMCO draft resolutions

Palikir, Pohnpei (FSM Information Services): September 6, 2011 - In a August 31 letter to Mr. Nikolao I. Pula, chairman of the 5-member Joint Economic Management Committee (JEMCO), President Manny Mori expressed "serious concern" over two draft JEMCO resolutions under consideration by the U.S. side of the committee.

JEMCO draft resolution 2011-2 proposes an incremental $700,000 annual reduction in compact funding expenditure for the College of Micronesia-FSM beginning in FY2013 until the college's funding is peaked at $1million per year throughout the remainder of the compact economic provisioning years. By 2023, a net amount of approximately $25 million will have been subtracted away due to this proposed change. This resolution also rejects a total of $8.4 million expenditure on infrastructure improvement at the college for the next four years.

JEMCO draft resolution 2011-3 demands reductions in scholarship expenditures in all of FSM by $1.8 million, eliminating a total of $18 million in scholarship grants over the remaining compact funding years.

In total, both proposals demand a net reduction of approximately $52 million by the time compact funding ceases altogether, on top of already built in decrements jointly agreed upon at the start of the amended compact.

The President writes, "what is staggering is not only the amount of these cuts, but the arbitrary and capricious way in which they are being proposed, with very minimal descriptive rationales, with almost no hard data to support them, no alternate expenditure plans and, most importantly, with absolutely no discussion with FSM leaders".

The President alluded to a one page prior communication from JEMCO explaining the rationale for the proposed cuts to have been based primarily on two positions understood to reflect the sentiments of the US JEMCO members:

1. "Funding for post-secondary education is beyond the intent of the Compact."

2. "Compact support is needed and would be better spent elsewhere."

According to the President, these two positions contradict the "policy of our nation over the duration of the Compact to date and are not reflected in the language of the FPA (Fiscal Procedure Agreement)".

The President pointed out that FPA Article II on "economic assistance implementation" stipulates that the education sector grant "shall support and improve the educational system of the Federated States of Micronesia, including, without limitation, the systems for primary, secondary, and post-secondary education", along with the human and material resources that comprise such systems.

The position number one clearly clashes with the explicit language of FPA Article II.

The proposed resolutions are deemed major policy changes that will impose very substantive impacts on implementations of certain goals and overall results in education sector. The FSM has not been afforded the opportunity to consult with the US regarding these proposed changes. Instead, the fate of these proposed changes, along with the fate of the programs and services they stand to change, are set to be determined by JEMCO whose voting split disfavors the FSM.

The way the proposals have been put forth seems to have ignored the bilateral nature of the FSM-US relations and fallen short of assuring the FSM people "real participation" in deciding over a matter that will shape their future.

In concluding his letter, President Mori requested that the matter be given a more in-depth review and transparent consultative process that allows for stakeholder involvement in search of mutually satisfactory lasting solutions.

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FSM Office of the President
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