Recovery is underway with improving fiscal balance, declining debt, and well-contained inflation, though FY2024 real GDP remained below pre-pandemic levels and the debt level is still high. The 2023 Compact Review Agreement (CRA-23) and a successful tax reform have provided Palau with additional fiscal space to navigate long-term challenges, including adverse demographic shifts and climate vulnerability.
International Monetary Fund. Asia and Pacific Dept (Thu,) studied this question.