Palau's president says a 250 million US dollars direct aid package from the United States will go towards health, education, government operations and other areas.
The deal was recently signed in Hawaii and covers the period from 2010 to 2024.
Johnson Toribiong says there is no link between the deal and his country's hosting of six Uighurs released from Guantanamo Bay.
He says the package will help fund vital areas.
"The 250 million US dollars are to be used to subsidise the governmental operations in Palau, plus the federal grants and programmes which previously we were receiving from the US in the fields of health, education, infrastructure etc."
Johnson Toribiong says 20 million US dollars is to be used to fund the US postal services in Palau, Marshall Islands and the Federated States of Micronesia.