Palauans decry hardships due to rising cost of living
Palauans told it like it is at a rare Senate hearing on rising costs and economic pressures. From grandparents spending 75% of their income on utilities to small business owners battling high taxes and bank rates, daily life is getting harder.
By: Faith Chen
KOROR, Palau – “The struggle is real,” declared Jennifer Sugiyama, a public advocate, as she described the hardships many Palauans are facing amid rising living costs. Her statement set the tone for a rare and candid public hearing held by the Twelfth Olbiil er a Kelulau on September 10, 2025, where citizens, private sector representatives, and community organizations openly discussed the state of the economy and the national budget.
For over three hours, attendees shared personal experiences illustrating the increasing financial pressures on households. Sugiyama recounted a grandmother who spends nearly 75% of her income on electricity and water while supporting four grandchildren on just $100. A former state legislator added, “We all feel the hard life here, while the government continues to tax people,” reflecting widespread frustration over diminishing buying power and rising prices.
The private sector highlighted economic challenges for small businesses, emphasizing the need for policies and programs that support Palauan entrepreneurs. “By nurturing local businesses, we can build a stronger economy that benefits all Palauans,” a spokesperson said. Issues such as high interest rates at the National Development Bank, reportedly higher than commercial banks, were cited as barriers to growth and job creation.
Community organizations also voiced pressing needs. Cindy Salvador, representing Parent Empowered and the Omekesang groups for special needs, appealed for support and acknowledgement of the special needs citizens.
Citizens challenged lawmakers to take concrete action. “Talk is cheap,” one participant said. “What scenario do you envision years from today? If we come back four years from now, what would have changed?” Asked another. Many attendees also raised concerns about the Palau Goods and Services Tax (PGST), suggesting that the burden falls disproportionately on the people and that some revenue could be used to offset high utility costs. The Ministry of Finance recently reported that PGST collections are projected to exceed $10 million by fiscal year-end.
Senators expressed commitment to transparency and public input, acknowledging that the hearing provided a crucial platform for citizens’ voices. Many attendees expressed gratitude for the opportunity, noting that open public discussions on the national budget have not been held in years.
For Palauans, the hearing was a rare moment to speak openly about daily struggles and advocate for policies that create a more inclusive and sustainable economy.