PLW · snapshot 2026-08-09
Palau
LowOverall risk score
32.0
Percentile of scored universe
24th
Data coverage
71%
vs Australia (16.1)
+15.9
Category breakdown
Political Stability & Governance
Low6 indicators · 100% coverage
Economic Resilience
Very High6 indicators · 85% coverage
Financial & Currency Risk
Insufficient dataInsufficient data
Business Environment
Insufficient dataInsufficient data
Security & Crime
Low3 indicators · 80% coverage
Climate & Social Compliance
Medium2 indicators · 65% coverage
Technology & Digital
High4 indicators · 100% coverage
Cultural Distance
Insufficient dataInsufficient data · not in overall score
Key risks and considerations
Palau rates Low for market entry — an overall risk score of 32.0, less risky than 76% of rated economies and 16 points riskier than Australia.
The main risk drivers are no double-tax agreement with Australia, no investment-treaty protection with Australia, a boom-bust growth record (±6.5 pp over the decade) and external imbalance (current account -48.0% of GDP, 3-yr average).
Relative strengths: organised crime pervasiveness and political stability & absence of violence/terrorism both sit in the least-risky quarter of rated economies, and currency stability rates Low, the least-risky rating band.
Possible mitigations
- Withholding tax. No double-tax agreement with Australia: model withholding tax on dividends, interest, and royalties into the business case — it can decide the entity-vs-export question.
Generated automatically from this snapshot’s indicator data — a starting point for analysis, not advice.
Indicators
| Indicator | Value | Risk score | Rating | Australia | Data source year | Source |
|---|---|---|---|---|---|---|
| Political Stability & Governance | ||||||
| Voice & accountability (WGI) | 75.0 | 15.9 | Low | |||
| Government effectiveness (WGI) | 51.5 | 49.8 | Medium | |||
| Regulatory quality (WGI) | 62.5 | 28.5 | Medium | |||
| Rule of law (WGI) | 77.1 | 13.3 | Low | |||
| Control of corruption (WGI) | 58.1 | 31.9 | Medium | |||
| Political stability & absence of violence/terrorism (WGI PV) | 87.1 | 7.2 | Low | |||
| Economic Resilience | ||||||
| GDP growth (3-yr average, %) | 6.5% (3-yr avg) | 65.0 | High | |||
| Growth volatility (10-yr std dev, pp) | ±6.5 pp | 85.8 | Very High | |||
| Government net debt (% of GDP) | 62.3 | 45.0 | Medium | |||
| Inflation (CPI %, vs income-group target) | -0.4 | 35.0 | Medium | |||
| Current account (3-yr average, % of GDP) | -48.0% (3-yr avg) | 85.0 | Very High | |||
| FX reserves (months of import cover) | — | — | Insufficient data | |||
| GDP per capita (PPP, current intl $) | $23,052 | 47.0 | Medium | |||
| Financial & Currency Risk | ||||||
| Capital-account openness (Chinn-Ito KAOPEN) | — | — | Insufficient data | |||
| Currency stability (regime-aware classification) | No independent currency (USD/EUR/AUD in use) | 10.0 | Low | |||
| Sovereign credit risk (OECD country risk classification) | — | — | Insufficient data | |||
| FATF listing (grey / black list status) | Not listed | 0.0 | Low | |||
| Double-tax agreement with Australia | None in force | 100.0 | Very High | |||
| Business Environment | ||||||
| FDI regulatory restrictiveness (OECD FDIRRI) | — | — | Insufficient data | |||
| Logistics performance (World Bank LPI) | — | — | Insufficient data | |||
| Business readiness (World Bank B-READY pillar average) | — | — | Insufficient data | |||
| Investment protection with Australia in force (BIT or FTA investment chapter) | None in force | 100.0 | Very High | |||
| Security & Crime | ||||||
| Armed-conflict intensity (battle deaths per 100k, 5-yr) | 0.0 | 29.7 | Medium | |||
| Intentional homicide rate (per 100k) | 11.2 | — | Insufficient data | |||
| Organised crime pervasiveness (GI-TOC criminality score) | 2.8 | 7.0 | Low | |||
| DFAT Smartraveller advisory level | Level 1 — Exercise normal safety precautions | 10.0 | Low | |||
| Climate & Social Compliance | ||||||
| Physical climate vulnerability (ND-GAIN vulnerability) | 0.482 | 63.9 | High | |||
| Disaster risk (INFORM Risk Index) | 2.2 | 14.9 | Low | |||
| Modern-slavery prevalence (per 1,000) | — | — | Insufficient data | |||
| Modern-slavery vulnerability score | — | — | Insufficient data | |||
| Technology & Digital | ||||||
| E-government development (UN EGDI) | 0.5 | 70.7 | High | |||
| Internet users (% of population) | 83.9 | 46.0 | Medium | |||
| Cybercrime origination (World Cybercrime Index) | 0.0 | 10.0 | Low | |||
| Secure internet servers (per million people) | 1469.3 | 44.4 | Medium | |||
Per-indicator ratings are quartile bands of the 0–100 risk score. The Australia column shows the same indicator’s raw value for the Australian baseline in this snapshot.
Cultural distance
GLOBE 2004 societal practices · rated on distance from Australia · not in the overall score
Context — not scored
Unemployment
—
Displayed, never scored: ambiguous for an entrant and unreliable where informal employment dominates.
Trade agreement
No Australian FTA in force
Market access is decision-relevant but a benefit, not a risk — kept out of the rating.
Regional advisories
No higher regional advisory levels
DFAT Smartraveller sub-national advice where it exceeds the overall level.
Compare with
A score means little on its own. These economies scored closest to Palau in this snapshot, which is the fastest way to see whether the rating is telling you something specific or something regional.