The Republic of Palau Compact of Free Association (COFA) Trust Fund closed the third quarter of 2026 ending September 30th at $447,334,633, absorbing a modest quarterly dip as broad market rate pressures challenged fixed income and small caps. This is according to a quarterly report from Raymond James, Palau’s money manager in United States.
The trust fund is a part of the COFA agreement between Palau and US that went into effect in 1994 at which time the initial amount of $66 million was paid but was required to be invested in US and cannot be withdrawn unless US approved.
The trust fund was supposed to yield an annual interest of 12% and to reach $500,000,000 after 15 years enabling Palau to fund its government annual budget as ab independent nation. But It is now 32 years later, such amount has not reached and we are more independent. Some of the reasons include fluctuations in stock market and also that Palau had withdrawn some amounts annually to support its budget and programs since then.