The first national development plan (1985–89) was the initial stage of the government's 15-year program designed to achieve national self-sufficiency. Funds accruing under the Compact of Free Association were required for implementing the plan, and rephasing of the plan was necessary. A multi-million dollar US-implemented capital improvement plan was scheduled for completion in 2001. It included new airports, docks, water and sewage systems, paved roads, and hospitals. Under the terms of the Compact, the United States provided $1.3 billion from 1986– 2001 in grant aid.
A Second National Development Plan covering the years 1992–96 sought to diversify Micronesia's economy; mainly to wean it from dependence on Compact funds. Little was accomplished. In late 1999, representatives of the United States and Micronesia began negotiations aimed at renewing some provisions of the Compact of Free Association.