Private Sector Assessment for Palau: Policies for Sustainable Growth Revisited

Institutional Document | February 2017

While the private sector in Palau still faces significant challenges, commendable advancements that have been made.

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Palau’s economy expanded strongly, with real gross domestic product (GDP) rising 5.3% in 2014 and 8.2% in 2015. Per capita GDP also increased; at the end of fiscal year 2015 it was in excess of $16,000—the highest among Asian Development Bank (ADB) developing members in the Pacific. This strong performance, however, masks urgent issues threatening the sustainability of Palau’s economy.

This private sector assessment is based on in-depth consultation with the government and private sector. It recommends
further reform, most notably in the areas of tourism policies and business law, as well as in the agriculture and finance sectors. It suggests that Palau’s state-owned enterprises are inefficient and need to operate on commercial principles. Measures to promote equal access to economic opportunities for women and fiber optic connectivity with other countries are also provided.


  • Tables, Figures, and Boxes
  • About the Pacific Private Sector Development Initiative
  • Foreword
  • Abbreviations
  • Executive Summary and Recommendations
  • Overview
  • Structure and Performance of Palau’s Economy
  • The 2007 Private Sector Assessment: Recommendations and Outcomes
  • Issues Facing Palau’s Private Sector
  • Tourism
  • Land
  • Access to Finance
  • Agriculture
  • Commercial Legal Framework
  • Economic Empowerment of Women
  • Tax Policy
  • State-Owned Enterprises
  • How Does the Current Business Environment Disadvantage Palauans?
  • Conclusion
  • References

Additional Details

  • ADB administration and governance
  • Private sector development
  • Palau
  • RPT178664-2
  • 978-92-9257-755-1 (Print)
  • 978-92-9257-756-8 (e-ISBN)

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