Government of the Federated States of Micronesia

International Commercial Shipping Agreement in Micronesia

PALIKIR, Pohnpei (FSM Information Service): April 30, 1998 – an Agreement
on Regional Cooperation for Commercial Shipping in Micronesia
is being transmitted to Congress for ratification, according
to a communication from FSM Vice President Leo Falcam on April 20.

a draft resolution for ratification of the “Agreement
on Regional Cooperation in Matters Affecting International Commercial
Shipping in Micronesia” (the MSC Agreement) by the FSM Congress
accompanied the agreement.

The MSC Agreement provides for cooperation among the FSM,
the Republic of Palau and the Republic of the Marshall Islands
in commercial shipping. Under the agreement, carriers which provides
the greatest benefits to the region will be allowed Entry Assurance.

The agreement would allow most advantageous competition scheme
while avoiding monopoly and excessive competition. The regional
coordination and cooperation offers advantages for negotiation
of services. For example, Yap’s location on the route to Palau
and Kosrae’s proximity to Ebye requires coordination with the
RMI and Palau, Falcam stated.

This administration wholeheartedly support the Agreement and
urged Congress to ratify it, Falcam concluded.

Commercial Shipping is the link between the FSM, RMI and Palau
with exporting nations who conduct commercial activities in this
region.

Without their own adequate shipping companies, foreign commercial
shipping companies are providing this vital link via the Entry
Assurance agreement negotiated annually between the representatives
of the regional governments and the Commercial Shipping Companies.

The initial MCS Agreement was established in 1974 during the
Trust Territory Administration and was in existence until it
was renegotiated on Guam on November 21, 1997.