Palau · Results · Macro Scenarios

Vulnerability and opportunity

Archetype: Small and exposed. Small states with narrow economies and few buffers. One of 25 nations with a similar pattern of results.

Exposed over 10 years: higher vulnerability, lower opportunity than the median nation.

Vulnerability · 10 years41.9rank 25 of 197 · 3 years: 41.3

Worst case−33.7%Global financial crisis · tail −31.7%

Opportunity · 10 years−14.6rank 184 of 197 · 3 years: −13.6

Best case+3100-day pandemic defence · gainer in 0 of 10

Shock absorbed12%by its own buffers, across downside scenarios

Policy dividend+1.15expected index points from best practice

Breadth14 of 14scenarios in which a domain falls a band

Weakest linkAdvanced Materials & Manufacturingweakest point in 2 scenarios

Main drivers of vulnerability over 10 years: Global financial crisis, Energy supply shock, Chokepoint closure. Highest exposure indicators: adult obesity rate; public debt relative to gdp; urban share of population; services as a share of gdp.

Downside scenarios: load test

Change in Palau’s capability index under each scenario at Standard Severe and current plans, largest fall first.

Global financial crisis S03−0.96

Pandemic S14−0.92

Sovereign funding crisis S04−0.82

Energy supply shock S09−0.82

Chokepoint closure S05−0.76

AI diffusion shock S13−0.70

Infrastructure collapse S12−0.64

Geoeconomic confrontation S01−0.60

Disaster in the core S10−0.52

Single-supplier cut-off S02−0.40

Legitimacy crisis S07−0.31

Food and water shock S11−0.30

Hybrid campaign S06−0.24

Mass displacement S08−0.17

Scenario	Exposure	Change	No response	Best practice	Rank shift	Bands lost	Weakest point
Global financial crisis S03	High 0.79	−0.96	−1.06	−0.49	▼ 1	20	Economic Output & Productivity 0 · Inception
Pandemic S14	High 0.78	−0.92	−1.05	−0.47	▼ 2	20	Biotechnology & Health Technologies 0 · Inception
Sovereign funding crisis S04	High 0.68	−0.82	−0.95	−0.42	0	18	Financial Stability & Crisis Management 0.6 · Inception
Energy supply shock S09	High 0.77	−0.82	−0.90	−0.41	▲ 3	17	Energy Technologies 0 · Inception
Chokepoint closure S05	High 0.84	−0.76	−0.84	−0.40	▼ 1	13	Resource Infrastructure 0 · Inception
AI diffusion shock S13	High 0.69	−0.70	−0.80	−0.36	▼ 1	17	Semiconductors & Advanced Computing 0 · Inception
Infrastructure collapse S12	Medium 0.58	−0.64	−0.70	−0.32	▲ 3	12	Connectivity, Cyber & Trust Technologies 0 · Inception
Geoeconomic confrontation S01	Medium 0.56	−0.60	−0.68	−0.30	▲ 1	10	Advanced Materials & Manufacturing 0 · Inception
Disaster in the core S10	High 0.61	−0.52	−0.64	−0.29	▲ 4	17	Energy Infrastructure 1.2 · Inception
Single-supplier cut-off S02	Medium 0.56	−0.40	−0.44	−0.20	▲ 2	7	Advanced Materials & Manufacturing 0 · Inception
Legitimacy crisis S07	Medium 0.45	−0.31	−0.40	−0.18	▲ 9	6	Force Generation & Mobilisation 0 · Inception
Food and water shock S11	Low 0.28	−0.30	−0.35	−0.16	▲ 10	7	Resource Infrastructure 0 · Inception
Hybrid campaign S06	Low 0.28	−0.24	−0.27	−0.12	▼ 1	3	Sensing, Timing & Navigation 0 · Inception
Mass displacement S08	Low 0.25	−0.17	−0.21	−0.09	▲ 7	3	Fiscal Capacity & Public Finance 4 · Nascent

Where each scenario lands

Change in each of the nine capability domains, in points. Darker is a larger fall.

Scenario	CT	SI	NS	HC	II	GI	FS	PI	TI
Global financial crisis	−0.11	−0.50	−0.29	−1.04	−1.04	−1.31	−1.75	−1.39	−1.18
Pandemic	−0.11	−0.54	−0.29	−1.36	−1.19	−1.27	−1.19	−1.16	−1.16
Sovereign funding crisis	−0.04	−0.66	−0.25	−0.98	−0.88	−1.22	−1.47	−0.88	−1.01
Energy supply shock	−0.04	−1.01	−0.29	−0.52	−0.52	−1.17	−1.38	−1.25	−1.19
Chokepoint closure	−0.04	−1.19	−0.48	·	−0.65	−1.39	−0.56	−1.10	−1.43
AI diffusion shock	−0.11	−0.44	−0.26	−1.20	−0.90	−1.24	−1.05	−0.58	−0.52
Infrastructure collapse	−0.11	−1.03	−0.26	−0.39	−0.39	−0.98	−0.92	−0.90	−0.79
Geoeconomic confrontation	−0.11	−0.37	−0.22	·	−0.87	−0.84	−0.87	−0.85	−1.28
Disaster in the core	−0.04	−1.04	−0.22	−0.82	−0.37	−0.92	−0.49	−0.37	−0.37
Single-supplier cut-off	−0.11	−0.24	−0.22	−0.42	·	−0.86	·	−0.87	−0.87
Legitimacy crisis	−0.08	·	−0.31	−0.26	−0.60	−0.84	−0.69	·	·
Food and water shock	−0.03	−0.33	−0.10	−0.43	−0.41	−0.44	−0.20	−0.35	−0.40
Hybrid campaign	−0.06	−0.45	−0.32	·	−0.50	−0.47	·	−0.19	−0.19
Mass displacement	·	−0.18	−0.09	−0.36	−0.30	−0.41	−0.17	−0.02	·

Columns: CT Critical Technology · SI Strategic Infrastructure · NS National Security · HC Human Capital · II Information & Influence · GI Governance & Integrity · FS Financial Strength · PI Production & Innovation · TI Trade & Investment.

Upside scenarios: capture test

Net position in each upside scenario: what Palau is ready to capture, less what it stands to lose.

100-day pandemic defence S24+3.3

Sovereign debt reset S19+2.7

Emerging-market breakout S20−0.6

Middle East settlement S21−2.5

Energy abundance S16−8.5

Digital state leapfrog S23−8.8

Yield revolution S22−14.4

Great-power détente S18−26.1

Biomedical breakthroughs S17−33.4

Superintelligence takeoff S15−42.5

Scenario	Position	Net	Capture	Loss	Readiness	Rank	Binding capability
100-day pandemic defence S24 ↗	Mixed	+3.3	7.1	3.8	10	116	Biotechnology & Health Technologies 0 · Inception
Sovereign debt reset S19 ↗	Mixed	+2.7	6.7	3.9	21	105	Financial Regulation & Integrity 3.3 · Nascent
Emerging-market breakout S20 ↗	Mixed	−0.6	7.8	8.4	15	157	Investment Attraction & Projection 2 · Inception
Middle East settlement S21 ↗	Mixed	−2.5	7.5	10.1	18	151	Energy Infrastructure 2.6 · Inception
Energy abundance S16 ↗	Mixed	−8.5	7.2	15.7	8	151	Energy Technologies 0.4 · Inception
Digital state leapfrog S23 ↗	Mixed	−8.8	5.2	14.1	10	141	Connectivity, Cyber & Trust Technologies 0.4 · Inception
Yield revolution S22 ↗	Loser	−14.4	2.8	17.1	8	165	Biotechnology & Health Technologies 0 · Inception
Great-power détente S18 ↗	Loser	−26.1	5.1	31.2	11	193	Export Capability & Sophistication 1.7 · Inception
Biomedical breakthroughs S17 ↗	Loser	−33.4	7.8	41.2	12	194	Biotechnology & Health Technologies 0 · Inception
Superintelligence takeoff S15 ↗	Loser	−42.5	3.8	46.4	7	189	Semiconductors & Advanced Computing 0 · Inception