Bilateral political relations between Germany and Palau are amicable and characterised by shared values. Diplomatic contacts are maintained through the German Embassy in Manila. Germany has an honorary consul in Palau.
Bilateral relations date back to the period of German colonial administration between 1899 and 1914. However, there are hardly any traces of this time, apart from some architectural vestiges of phosphate plants on Angaur Island, the name of a waterway (German Channel) and other names. In October 2005, Palau National Museum opened a small German department.
The “Krämer volumes” from the German South Seas Expedition (1907–1910) undertaken by the German Navy physician, anthropologist and ethnographer Augustin Krämer (1864–1941) remain relevant. The records contained in the five volumes are still recognised today by Palau’s courts as the only authentic source in tribal disputes or conflicts over property. In the absence of official national or other written records, Augustin Krämer’s records constitute the codified memory of Palau’s culture and identity, which are under threat from the modern way of life. The Federal Foreign Office funded the translation of the records from German into English.
Germany primarily supports economic, social and cultural development in Palau through its substantial contributions to the EU’s European Development Fund (EDF) (since 2021: the Neighbourhood, Development and International Cooperation Instrument (NDICI)). Palau also plays a role in Germany’s close cooperation on climate change with the countries in the South Pacific, particularly within the framework of regional programmes run by the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH and the International Climate Initiative (ICI) of the Federal Ministry for the Environment, Nature Conservation and Nuclear Safety.
Palau is a member of the Group of Friends on Climate and Security in the United Nations founded by Germany and Nauru in 2018.
Bilateral trade relations are limited. According to Federal Statistical Office figures for 2020, Germany imported goods worth €20,000 from Palau and exported goods worth approximately €106,000.