Palau has already made significant progress in reaching the targets of the Millennium Development Goals (MDGs). Health, education and other public utilities are well developed and freely provided by the government.
The country earns most of its revenue from fishing and tourism. In spite of a comparatively high standard of living compared to some other Pacific islands, wealth is unevenly spread. The preservation of increasingly endangered fragile ecosystems is a concern. Priority sectors for 10th European Development Fund (EDF) assistance are water and energy.
The Country Strategy Paper for Palau (2008-13) and a multi-annual indicative programme outline the fundng areas for the €2.9 million 10th EDF budget: water and energy – notably the identification of new and renewable sources.
Greater use of renewable sources is both improving the security of energy supplies and reducing the costs of importing fuel. Household renewable energy systems are being installed in outer island and rural areas in particular thanks to EU support.