territorial residents. Notwithstanding these efforts, most of the territories have made little progress toward becoming economically self- reliant and remain highly dependent on federal assistance, Most of the territories face constraints--such as geographic many indigenous isolation from U.S. and- world markets, limited natural and Manpower resources, small land areas, limited infrastructure to support development and attract investment, and large public sectors-which make economic self-reliance an unlikely prospect for the 23 to 25.) foreseeable future. (See pp. FEDERAL CONSTRAINTS RELATE TO INCONSISTENT TREATMENT IN FORMULATING AND EXTENDING POLICIES, LAWS, AND PROGRAMS GAO found that there is no federal policy which details how the territories should be treated in formulating and extending laws and programs. Territory officials identified instances when federal policies, laws, and programs have constrained economic and social development because they were inconsistently applied, insensitive to unique territorial circumstances and needs, tions. or inappropriate Examples cited for included local condi- the Caribbean Basin Initiative provisions affecting the rum industry and the tuna industry in the Virgin Islands and American Samoa, respectively; Department of the Treasury rulings preventing the use of tax exempt bonds; legislation to eliminate important tax benefits to Puerto Rico; and shipping, tax, immigration, and environmental laws which constrain development initiatives. Congress and the executive branch have acknowl- edged many meant to territories of and the remedy problems have many identified initiated of the several by the actions problems. For example, a laws commission was established for the Northern Mariana Islands in 1980 and the Department of Interior began a review of fed~ eral laws affecting the territories in 1981. Congress has enacted legislation, such as Title V of Public Law 95-134, which authorized federal agencies to consolidate grants to the iv I0CG200